Revitalizing your Business with Technology
A common scenario for most mature companies that have been in business for more than 10 years, is that they either still run a major part of their business with the original technology infrastructure from when they started the company, or they have an amalgam of technology infrastructures, partially implemented software applications, and multiple systems that need to be integrated from previous acquisitions.
Sound familiar?
Don't be too disturbed. There are very few companies out there that have a perfect business and technology integration infrastructure. That is because just when you think you have it all integrated, the business changes and you now have a new system to integrate or a new acquisition to consolidate.
It's an evolutionary cycle in which the technology and business infrastructure has to grow as you are growing your business. Imagine a company when it first starts as a newborn child, and (bear with the analogy) imagine the clothing you provide for your child as your technology and business infrastructure. You provide clothing to that child as he grows. You consistently buy new shoes, shirts, and pants in bigger sizes as the child continues to grow.
But what would happen if one day you decided it was just too expensive to continue purchasing clothes for your child, as they got older, and that you could save a lot of money if you just stopped buying clothes for your child when they were five years old? You could argue that if his feet got too big you could just cut off the tips of the shoes and let his feet expand. Or you could patch together a number of shirts to create an even bigger shirt, etc., etc.
Your child would be busting at the seams of its clothing, as would your business suffer from the lack of infrastructure. This example seems comical because we know that no parent would stop buying their children clothes, except unfortunately I have seen many companies stop investing in their infrastructure and suffer the consequences.
Below is a step-by-step process I use with clients when helping them align their technology infrastructure with their business objectives.
1. Identify process inefficiencies
You need to have a firm grasp of where the bottlenecks are in your cash flow. Don't worry about chasing after the new fad in technology or what your competitors are doing, focus on what is going to generate revenue or cut costs for your business.
Many executives make the mistake of deciding what the root causes are without doing any analysis. There is nothing wrong with having gut instinct, but make sure you get it validated with real data. Engaging a third party has the benefit of a non-biased observer that can pull the details together without the fear of internal politics.
2. Have a technology roadmap
I was once working with a business executive that stated that his company's website needed to be changed immediately. When I asked him specifically what did he feel needed to be changed, his only response was "I don't know...everything!" I like to call this approach the "Fire, fire, fire, ready, aim" strategy or also known as the "Boil the ocean" approach.
If you don't know where you are going any path can get you there. But at what cost, and what detriment to your business? You need to spend the time to clearly identify business objectives of what you want to achieve from where you are today. Without clear business objectives it is impossible to put together a technology roadmap that will be of value to the business.
3. Develop and motivate your staff
Any time you undergo major changes in your infrastructure it has a major effect on your staff. Your staff needs to see how do they fit into the equation, and how do they derive value from the change.
The approach I recommend is to insure you enable people with the appropriate training, support, and give them new tasks to tackle. You insure that it is enough of a stretch so they can grow from the experience. The mechanism is Darwinian, some will make it; others won't.
But throughout this process you need to hold people accountable, and that includes yourself! It's not good enough to delegate all of the responsibility, and expect things to happen. You need to actively monitor the process. Credit needs to roll down to the people actually doing the work, and accountability needs to roll up. Be careful if you are insulated from those getting the work done by several layers of management. If projects fail often it is not those doing the work that are at fault: They may be working with inadequate resources, unrealistic timeframes, and worst of yet most of them might not feel comfortable telling you till it is too late.
4. Be wary of those vendors looking to "help"
Some just want to help themselves to your profits! Many executives when discussing technology transformation feel they are washed out to sea with technology jargon and multiple options, and all they want is a simple solution to solve their business problems.
Many a great promise has been made on PowerPoint presentations, but only to fail miserably in actual results. Steer clear of multi-year projects with no clear deliverables. Demand real ROI, hard dollars not soft and fuzzy projections, that have to be achieved within the year.
You should question any vendor that will not give you a 30-day out clause from your contract. Being locked into a bad contract can impede your company's ability to grow and be more dynamic.
Remember you can't spend yourself out of a problem. Make the vendors earn your business, just like you have to earn your own customer's business.
5. Start small... think big
It is often tempting to take on larger projects because it has more splash and sizzle. I worked with one company that had a 10-year plan on how it was going to change its technology infrastructure. Two years into it, it was cancelled. Realistically businesses cannot afford to run this way, especially if the business plan of today will soon change tomorrow.
Approach projects in increments. Smaller investments allow you to be dynamic and responsive to the business and your customers. It is better to invest $50K into one small project, and if it succeeds invest more. Rather than spending $1 million and hoping that it works.
Bear in mind that you can’t turn a company around overnight, and it is going to take time and persistence to make it happen. Most people cannot be turned 180 degrees at one time, but most can be changed one degree at a time. If you can consistently persuade and show them 180 times, you can get people to change.
Changing a corporate culture and people requires a lot of work. Change is scary for many people. Have a thick skin and don’t let minor setbacks derail you. Often using an external party to be the change agent allows more people to feel that they are on equal footing and they will be more willing to participate.
Summary
Sound familiar?
Don't be too disturbed. There are very few companies out there that have a perfect business and technology integration infrastructure. That is because just when you think you have it all integrated, the business changes and you now have a new system to integrate or a new acquisition to consolidate.
It's an evolutionary cycle in which the technology and business infrastructure has to grow as you are growing your business. Imagine a company when it first starts as a newborn child, and (bear with the analogy) imagine the clothing you provide for your child as your technology and business infrastructure. You provide clothing to that child as he grows. You consistently buy new shoes, shirts, and pants in bigger sizes as the child continues to grow.
But what would happen if one day you decided it was just too expensive to continue purchasing clothes for your child, as they got older, and that you could save a lot of money if you just stopped buying clothes for your child when they were five years old? You could argue that if his feet got too big you could just cut off the tips of the shoes and let his feet expand. Or you could patch together a number of shirts to create an even bigger shirt, etc., etc.
Your child would be busting at the seams of its clothing, as would your business suffer from the lack of infrastructure. This example seems comical because we know that no parent would stop buying their children clothes, except unfortunately I have seen many companies stop investing in their infrastructure and suffer the consequences.
Below is a step-by-step process I use with clients when helping them align their technology infrastructure with their business objectives.
1. Identify process inefficiencies
You need to have a firm grasp of where the bottlenecks are in your cash flow. Don't worry about chasing after the new fad in technology or what your competitors are doing, focus on what is going to generate revenue or cut costs for your business.
Many executives make the mistake of deciding what the root causes are without doing any analysis. There is nothing wrong with having gut instinct, but make sure you get it validated with real data. Engaging a third party has the benefit of a non-biased observer that can pull the details together without the fear of internal politics.
2. Have a technology roadmap
I was once working with a business executive that stated that his company's website needed to be changed immediately. When I asked him specifically what did he feel needed to be changed, his only response was "I don't know...everything!" I like to call this approach the "Fire, fire, fire, ready, aim" strategy or also known as the "Boil the ocean" approach.
If you don't know where you are going any path can get you there. But at what cost, and what detriment to your business? You need to spend the time to clearly identify business objectives of what you want to achieve from where you are today. Without clear business objectives it is impossible to put together a technology roadmap that will be of value to the business.
3. Develop and motivate your staff
Any time you undergo major changes in your infrastructure it has a major effect on your staff. Your staff needs to see how do they fit into the equation, and how do they derive value from the change.
The approach I recommend is to insure you enable people with the appropriate training, support, and give them new tasks to tackle. You insure that it is enough of a stretch so they can grow from the experience. The mechanism is Darwinian, some will make it; others won't.
But throughout this process you need to hold people accountable, and that includes yourself! It's not good enough to delegate all of the responsibility, and expect things to happen. You need to actively monitor the process. Credit needs to roll down to the people actually doing the work, and accountability needs to roll up. Be careful if you are insulated from those getting the work done by several layers of management. If projects fail often it is not those doing the work that are at fault: They may be working with inadequate resources, unrealistic timeframes, and worst of yet most of them might not feel comfortable telling you till it is too late.
4. Be wary of those vendors looking to "help"
Some just want to help themselves to your profits! Many executives when discussing technology transformation feel they are washed out to sea with technology jargon and multiple options, and all they want is a simple solution to solve their business problems.
Many a great promise has been made on PowerPoint presentations, but only to fail miserably in actual results. Steer clear of multi-year projects with no clear deliverables. Demand real ROI, hard dollars not soft and fuzzy projections, that have to be achieved within the year.
You should question any vendor that will not give you a 30-day out clause from your contract. Being locked into a bad contract can impede your company's ability to grow and be more dynamic.
Remember you can't spend yourself out of a problem. Make the vendors earn your business, just like you have to earn your own customer's business.
5. Start small... think big
It is often tempting to take on larger projects because it has more splash and sizzle. I worked with one company that had a 10-year plan on how it was going to change its technology infrastructure. Two years into it, it was cancelled. Realistically businesses cannot afford to run this way, especially if the business plan of today will soon change tomorrow.
Approach projects in increments. Smaller investments allow you to be dynamic and responsive to the business and your customers. It is better to invest $50K into one small project, and if it succeeds invest more. Rather than spending $1 million and hoping that it works.
Bear in mind that you can’t turn a company around overnight, and it is going to take time and persistence to make it happen. Most people cannot be turned 180 degrees at one time, but most can be changed one degree at a time. If you can consistently persuade and show them 180 times, you can get people to change.
Changing a corporate culture and people requires a lot of work. Change is scary for many people. Have a thick skin and don’t let minor setbacks derail you. Often using an external party to be the change agent allows more people to feel that they are on equal footing and they will be more willing to participate.
Summary
- If you want to revitalize your company you have to know what your issues are.
- Stay focused with a roadmap that can get you from where you are now to where you want to be.
- Take care of your people or there will be no one to take care of you.
- Make sure you are getting value for what you pay for.
- It’s a marathon not a race. Driving corporate change is difficult but the benefit to the company is significant.
- Have a thick skin and don’t let minor setbacks derail you.
- The process can be complex. Utilize a third party that has experience in this area to help effect the change.
posted by Soren Burkhart at 6:54 PM
0 Comments:
Post a Comment
<< Home