Editor's Note: Welcome to SmartAdvice, a weekly column by The Advisory Council (TAC), an advisory service firm. The feature answers two questions of core interest to you, ranging from career advice to enterprise strategies to how to deal with vendors. Submit questions directly to [email protected]
Question A: How might workflow software improve our business processes?
Our advice: One of the main functions of IT is to improve business processes and make companies more productive (read more revenue with fewer resources). For many years, that meant converting paper shuffling to digital processing. Now that so many business processes have been computerized, the payback from data-processing improvement is declining. However, people sometimes forget that human-based business processes can use improvement as well. Workflows aren't just limited to logistics and factory assembly lines. Even something as basic as a new-hire process lends itself to the new breed of workflow-analysis tools that enable companies to capture and improve the human workflows, in addition to the data and logistics.
Computer capabilities have increased exponentially so that the processing power required for workflow analysis tools is now within reach of even mid-size companies. As program and project management has become increasingly important to the success of businesses, companies are revisiting workflow-analysis tools, but they're looking for far more sophisticated analysis than ever before. Companies want to quantify the human/machine interface and track the complex human workflows outside the traditional manufacturing and logistics arena. After all, data that's never touched or seen by a human isn't very useful or profitable.
Look at the new business-intelligence and workflow-analysis tools to see if they can improve your human/computer interfaces. Be aware that they're still complex and expensive. When shopping for workflow software you need to determine how standardized your processes really are. If they're not standardized, how much are you willing to change them to conform to the software's standards? Look for software that's targeted specifically to your industry or processes. It can be well worth the additional upfront cost in terms of development time-savings. Commercial software often has incorporated best practices from many companies, something most companies can't match with software that's developed in-house. Remember, however, that industry best practices aren't always your best practices.
-- Beth Cohen and Sue-Rae Rosenfeld
Question B: The IT industry is maturing and consolidating. If an IT supplier is acquired, what should a CIO do?
Our advice: IT industry mergers and acquisitions almost always create near-term issues for customer CIOs, even if the acquisition is beneficial in the long term. The reason is that IT is a people-centric business, and when ownership changes, turnover invariably occurs at the supplier. Additionally, the recent trend is to buy market share, which means more products will be "sunset" and support levels will be reduced.
IT Industry Consolidation Framework
The first step is to assess the source of value provided by the vendor, and hence the value delivery that's at risk. If the source of value is products, risk-mitigation strategies are far different than if the source of value is the knowledge and expertise of the vendor's employees.
The second step is to candidly assess the nature of the vendor relationship. Don't confuse the size of a relationship with its criticality. If you can easily obtain the same products or services from a secondary source, it's likely that the vendor relationship is noncritical.
With the source of value and nature of the relationship understood, you're in a position to select the most appropriate strategy for your situation.
The first step is to position the potential impact of the IT vendor transaction and quell rumors. Let's use an experience adapting to Oracle's recent acquisition of PeopleSoft and J.D. Edwards as an example. The company in question is large, and has numerous J.D. Edwards and SAP implementations globally. The IT-management team used the framework discussed above, and agreed that there was very little "product risk" because the J.D. Edwards implementations are mature. Next, the team determined that the company's relationship with J.D. Edwards was noncritical because they rarely used J.D. Edwards' professional services or support service. Accordingly, IT management could communicate convincingly that the business would continue to harvest the benefits of its J.D. Edwards implementations for at least five more years. This communication aligned business constituency discussions.
-- Walt DuLaney
Beth Cohen, TAC Thought Leader, has more than 20 years of experience building strong IT-delivery organizations from user and vendor perspectives. Having worked as a technologist for BBN, the company that literally invented the Internet, she not only knows where technology is today but where it's heading in the future.
Sue-Rae Rosenfeld, TAC Expert, has more than 20 years experience as an IT project manager and business analyst, primarily in the financial industry. She has special expertise in data analysis, data modeling, and converting systems into new platforms, including mainframe to Internet and intranet server environments. In addition, she trains IT professionals in project management fundamentals and PMP exam prep. She is an active member and volunteer for the PMI New York City chapter.
Walt DuLaney, TAC Thought Leader, is an authority on the planning, design, and management of strategic business and technology initiatives. He consults extensively on strategy-alignment, project-management, and performance-measurement methods to assure that strategic initiatives are delivered successfully and operating results are verifiably improved. He is also the CEO of Adaptive RFID, an RFID software services company.