Digital disruption Part 4 – Blended IT – No time to waste – Just Get It Done

Solving Management’s Disruption Dilemma— the Blended IT Strategy

Part 4 – Blended IT – No time to waste – Just Get It Done

In this final article, sponsored by Hewlett Packard Enterprise; The Economist Intelligence Unit & JGID proposes an alternative to an overnight, all-or-nothing approach: blended IT. This is a dual-speed approach that supports a period of coexistence between the old and the new systems—giving Management the time and resources to manage the dilemma of disruptive change.

Blended IT is not an argument for standing still, or for a permanent state of coexistence between two separate systems.

At the current pace of change, even the most cutting-edge digital systems become legacy technologies in a matter of months. Cultures may attempt to defy change. No temporary architecture should stop the pressure to accelerate the fast track of the digitally transformed systems. Using appropriate technology such as JGID via Cloud computing is the most cost effective and efficient technology that benefits Owners and Managers of service based companies. It enables successful businesses to act swiftly in response to customer demands and administration compliance.

A firm that adopts the dual approach of blended IT are protected from the weaknesses and  complacency with its legacy technologies. Such old systems will only become an increasing drag on organisational agility and innovation. And as most Managers know, they are exceedingly high cost to maintain. The blended IT approach simply allows order, planning, and time to be part of a measured and constantly developing approach to customer and regulatory demands.

“Established companies must embrace new technology and simultaneously manage for the present and the future,” says Robert Siegel, co-instructor Stanford Graduate School of Business. “That means creating pockets of innovation and putting incentives in place to encourage the people involved in new initiatives and those focused on legacy activities to work together to transition from the old to the new.”

Eventually, many Owners and Managers will want to move their IT architectures to a unified, highly agile digital platform. For many that will mean migration to a cloud or hybrid cloud environment such as JGID. Blended IT is not a substitute for this digital end-game—it is just a measured, risk-managed, and practical route to getting there.

 

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Digital disruption Part 3 – Blended IT – The steady track—transforming systems that support operations

Solving Management’s Disruption Dilemma— the Blended IT Strategy

Part 3 – Blended IT – The steady track—transforming systems that support operations

There are a number of reasons internal-facing applications “the back office” can and should take a less rushed, more risk-managed approach to changing systems:

  • First, there isn’t the same urgency as with customer-facing applications. Internal demands and user do not require the interface experience one finds at Facebook.
  • Second, these systems are often integrated tightly into disparate operations of the firm from sales, through WHS compliance to accounts.

To be most efficient any new system needs to be capable of continuous updates to stay abreast of competitors and consumer demands. Refresh cycles using Cloud computing are near immediate. Real data changing and uploading available to all who need access, at their point and time of need. No delays, no requirement to adhere to ‘office hours’ and no require

In this article, sponsored by Hewlett Packard Enterprise; The Economist Intelligence Unit & JGID proposes an alternative to an overnight, all-or-nothing approach: blended IT. This is a dual-speed approach that supports a period of coexistence between the old and the new systems—giving Management the time and resources to manage the dilemma of disruptive change.

Many of these internal systems are housed on legacy technologies – proprietary and sometimes purpose-built systems that now need to communicate directly with the latest hand held field devices. While often maligned by digital proponents, many of these systems are doing their current jobs very well, are understood by their users, and are relatively immune from hacking and cyber-attacks. A Cloud based system allows Management to continue using large parts of the existing IT infrastructure yet handle the administrative functions at a state of the art level that keeps the business at the forefront of the market.

This “coexistence” will allow a period of cultural transition—training, repurposing of employees, recruiting—that is required to transform people.

One target for a blended IT approach are the monolithic enterprise resource planning (ERP) systems, which exist in all businesses under a variety of descriptions. “The traditional concept of end-to-end services like ERP (i.e. Excel spread-sheet planning & scheduling systems), reduces agility and the ability to compete,” says Alan Boehme, chief technology officer and chief innovation officer at The Coca-Cola Company. As a result, he is leading an effort to break up—but not scrap—his company’s legacy systems. “Smart companies are not talking about replacing their entire systems. They’re modernising specific portions of them through SaaS (Software as a Service),” such as JGID (Just Get It Done).

In other words, these systems do not remain static, but instead, change is measured, sequential, and managed for risk. The steady track allows for a sequence of orderly transformations—Quoting, scheduling, compliance, job management and invoicing—in order of impact and ease of implementation. Finally, a practical result is that the IT department can pace itself and not be overwhelmed in the course of an over-accelerated transition.

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Digital disruption Part 2 – The fast track – transforming systems that face the customer

Solving Management’s Disruption Dilemma— the Blended IT Strategy

Part 2 – The fast track – transforming systems that face the customer

In this article, sponsored by Hewlett Packard Enterprise; The Economist Intelligence Unit & JGID proposes an alternative to an overnight, all-or-nothing approach: blended IT. This is a dual-speed approach that supports a period of coexistence between the old and the new systems—giving Management the time and resources to manage the dilemma of disruptive change.

Applications that create the customer experience should be high on any Management’s priority list for digital transformation.

Over two-thirds of business customers’ leisure time online is spent on a few major sites – Facebook, Yahoo, Google, that have built their businesses on a great customer experience. Furthermore, digital natives dominate the consumer online commerce experience.

What do these companies do really well?

  • They present the customer with a compelling user experience – attractive, informative, and designed to drive the customer to a transaction or service.
  • The customer finds the same quality presentation of information on any device they choose to use.
  • The required data is drawn from multiple parts of the organisation, pricing from finance, products from a catalogue, availability from inventory—and presented as a seamless transaction.
  • The experience is highly personalised, from the order history to the recommended offers.
  • Customers recognise content that is specific to their industry or environment – software written for and within an industry makes a compelling proposition over ambiguous and generic Apps.

For Management, these expectations can be captured as a series of technology requirements:

  • Digital agilitya capacity to respond rapidly to consumer preferences and market movements
  • Device deliverynetworks that can serve all major device formats and operating systems
  • Cross-department integrationan ability to draw data from multiple points within an organisation
  • Data managementrepositories and analytics capable of handling lots of data points
  • Cultural transformationrapid retraining and transition of IT personnel
  • Scalabilityan ability to cost-effectively ramp up operations.

These requirements are compelling drivers for transformation to digital platforms that can support multiple devices, integrate disparate data, and provide the computing power for advanced analytics, such as JGID.

The proposition of the blended IT model is therefore to fast-track customer orientated functions such as sales, quoting, compliance, scheduling and invoicing. This multi faceted approach will quickly raise standards where they are most needed; in the eyes of the customer.

Secondly, this allows the organisation to take a more measured, risk-managed approach in the implementation of critical new internal systems and software.

 

 

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Solving Management’s Disruption Dilemma Part 1- the Blended IT Strategy

Solving Management’s Disruption Dilemma— the Blended IT Strategy

Introduction

The Professional Executive, who is on the front line of digital disruption, faces a dilemma.

Competitors may be taking market share through;

  • lower costs,
  • faster time-to-market, and
  • superior customer experience.

Such disruption creates an urgent pressure for change within any organisation.

In many firms, customers, competitors, CEOs and boards are looking to the Management for rapid digital transformation and looking for it immediately.

But the Managers are also charged with providing the stable platform that supports ongoing operations. These are the operational systems that process the quotes, book the sales, schedule the staff and equipment, and ensure regulatory compliance. Failure or down-time of these back-office processes, which often rely on old systems, can be disastrous for the firm (and for the continued employment of the Manager).

The dilemma is increased by pressures of risk and time. Accelerated transition to a new software can be high risk—data that does not integrate, systems that go down, and more human error in an uncertain environment. Added to this is the risk factor of an overstretched sales and estimating department trying to make everything happen at once.

Finally, transformation isn’t just about software or machines—it is about the people. You and your team.  For example, a Crane hire company may have personnel who are steeped in a culture of risk management, process, and strict regulatory adherence. These people are extremely valuable assets that cannot be morphed into agile, digital-savvy disruptors overnight.  These valuable staff need time and quality training to adjust, become proficient in and finally master any new system or software.

How does the thoughtful Manager or Business Owner strike the right balance between demands for transformation and stability? Between speed and risk? Between two very different cultures?

In this article, sponsored by Hewlett Packard Enterprise; The Economist Intelligence Unit & JGID proposes an alternative to an overnight, all-or-nothing approach: blended IT. This is a dual-speed approach that supports a period of coexistence between the old and the new systems—giving Management the time and resources to manage the dilemma of disruptive change.

Not all companies are faced with a clear and immediate disruption scenario. The following are some early warning signs that digital disruption might be coming your way.

  1. Is venture capital (VC) targeting your industry? VCs love digital challenges to traditional industries. While they may not get it right all the time, a lot of VC money flowing into your industry indicates a collective bet against your business and its technology.
  2. New pressure on pricing: Many disruptors use technology to compete on price—for example, automated systems are undercutting traditional costs of quoting and compiling tenders by as much as 75%. Are your sales people reporting pressure on prices?
  3. Loss of younger customers: Surveys show that the younger demographic is more comfortable with technology, and less loyal to established brands, than boomers. An out-migration of this critical customer segment could signal disruptive alternatives.
  4. Your best administration people are defecting: Is your culture so old-school that you are losing key personnel to the upstarts that are challenging you?
  5. Legacy system bypass: Are your internal customers going outside the system to get things done? Are they practicing “bring your own app” to get the functionality they need? Your systems for responding to sales enquiries may be making you vulnerable to external disruption.
  6. A competitor acquires another company in your industry: Some firms are concluding that the best way to beat disruptors is to buy them out. The combination of a promising new tech approach with the customers and deep pocket of an established competitor can present a potent disruptive threat to the old order.

 

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Part 3 – Lean Administration – Guiding principles

Lean administrative programming is a concept that emphasizes optimizing efficiency and minimizing waste in the development of all office processes. The concept is that efficiencies can be applied and waste managed at all levels: each individual, every department, interdepartmental operations, the organization as a whole, and the relationships of the organization with customers and suppliers. JGID business management software has been specifically designed to address these core requirements.

Lean administration is based on rules that were developed by several corporations in the 1980s. The rules have an upbeat and positive tenor. For example, waste and intermediate processes should be kept to a minimum. Documentation should be concise, and should cover generalities without getting lost in details. Individual workers, as well as customers, should be consulted frequently, and their views and opinions taken seriously.

A primary goal is continuous improvement at all levels and in all phases of the operation with the specific aims of improving the customer experience and simultaneously improving the cash-flow for the service provider.

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Part 2 – Lean Production – Guiding principles

Engineer Taiichi Ohno at Toyota, is credited with developing the principles of lean production also known as JIT (Just In Time production) after World War II. His philosophy, which focused on eliminating waste and empowering workers, reduced inventory and improved productivity. Instead of maintaining resources in anticipation of what might be required for future manufacturing, as Henry Ford did with his production line, the management team at Toyota built partnerships with suppliers. In effect, under the direction of Engineer Ohno, Toyota automobiles became made-to-order. By maximizing the use of multi-skilled employees, the company was able to flatten their management structure and focus resources in a flexible manner. Because the company was able make changes quickly, they were often able to respond faster to market demands than their competitors could.

Many industries, including software development such as JGID business management software, have adopted the principles of lean production. The ten rules of lean production can be summarized:

  1. Eliminate waste
    2. Minimize inventory
    3. Maximize flow
    4. Pull production from customer demand
    5. Meet customer requirements
    6. Do it right the first time
    7. Empower workers
    8. Design for rapid changeover
    9. Partner with suppliers
    10. Create a culture of continuous improvement
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Part 1 – Lean Management – Guiding principles

Lean management seeks to eliminate any waste of time, effort or money by identifying each step in a business process and then revising or cutting out steps that do not create value. JGID business management software has been specifically designed to address these core requirements.

The 3 Guiding principles for lean management include:

  • Defining value from the standpoint of the end customer.
  • Identifying each step in a business process and eliminating those steps that do not create additional value.
  • Making the value-creating steps occur in the best sequence.

Then repeating the first three steps on a continuous basis until all waste and repetition has been eliminated.

The ten rules of lean management can be summarized:

  • Eliminating wasteful administration processes,
  • Minimizing the number of admin tasks necessary to complete a job,
  • Maximizing cash-flow,
  • Respond to customer needs with minimal delay,
  • Identify from the outset the customer requirements,
  • Do it right the first time,
  • Empower workers,
  • Design for rapid change of task due to market forces, weather conditions etc,
  • Partner with suppliers,
  • Create a culture of continuous improvement
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Why should I write a Business Plan ?

The Business Plan, Strategic Planning and their relationship.

Over the last 40 years I have repeatedly been asked what is the value or point of a written Business Plan ? My answer has remained constant. It is the primary tool that all successful businesses use to maximize the return on their investment, secure employment, protect their assets and drive the business forward.

So over the coming weeks I thought I would share a comprehensive answer by publishing, a FREE self-help guide, to constructing a Business Plan that anyone can follow.

This is the template I have successfully used for start-ups and to rescue loss making businesses in various industries, countries and cultures. I have employed this structure in negotiations with many of the leading banks and venture capital investors. It is a hand’s on guide. I invite comment and additions from my fellow professional consultants. None of us have all the answers, but some of us have got the bruises and scars that come from previous mistakes and the lessons learned.

The first instalment will explore the vital role of the Strategic Goals that should identify the reason for being in the business. Too many businesses start because the owner is good at his or her trade. The running and structure of the business takes second place and thus tend to be run along familiar industry patterns, because “that’s how other existing businesses do things”. Without clear and identifiable purposes or goals such businesses always fail. I would prefer that you are each successful and realise your dreams, so please feel free to prosper from knowledge gained by others. I invite you to download this template, share it, copy it but most of all please use it.

A few points to consider:

The function of a Business Plan is not simply to borrow money from a bank. Rather it is the tool by which any successful business owner or budding entrepreneur can assess and run his business venture in a virtual sense before committing the money. The creation of the Business Plan enables you to experiment with infinite possible trading scenarios. It is the environment where the business owner can explore risk without loosing any money. The Business Plan is the tool that enables you to manage a series of critical changes to your business and establish which course of action offers the greatest reward at the lowest risk. Banks like businesses that have a structured and well researched Business Plan because it reveals how well informed the business owner is, and how credible their proposals.

The Business Plan should be compiled by the brightest minds in the business, preferably the business owners or Directors. It should not be researched and written by an outside consultancy, ( yes I have written many in my role as consultant or mentor). The critical point that cannot be stressed enough is that it is vital for the business owner to be deeply involved in all aspects of the Business Plan creation in order to make open and informed choices. It is the process of researching and constructing the B.P. that is so critical. A lot of people have a dream of a new product or service that is very often based on nothing stronger than hope or aspiration. The creation of a B.P. makes you assess the reality of the market, the reality of the product worth to prospective customers. The B.P. allows you to explore alternative routes to market, funding scenarios, staffing levels and capabilities and so much more.

So that you can access this free guide whenever you need, I will post it on LinkedIn but back it up on the blog at dev.snkeee.com.au/jgid Please visit, download, copy and comment at your leisure.

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Part 1 – The Strategic Goals for YOUR Business

Jigsaw puzzle sphere. Dynamic Explosion. Vector illustration
Jigsaw puzzle sphere. Dynamic Explosion. Vector illustration

The Strategic Plan.

Strategic goals are the fundamental, identifiable, reasons for the business existing.

The difficulty for many people is in clarifying the key or vital goals without allowing vague notions such as:

  • “I want to make a lot of money“, or
  • “I want to leave the business for future generations”, or
  • ”I want to run my own bakery” to replace clarity.

I would urge you to simplify the process to having no more than three very clear goals for your business. Successful owners that I know re-consider these goals annually and revise them as life, the economy and their industries change with time.

Let us take the three examples above.

  • “I want to make a lot of money“,

This is too vague to inform your daily decisions on investment. Far more helpful would be a goal such as;

  • “I want a return on my investment in the business 5% greater than if I invested in Australian bank XYZ over the next 12 months”.

This more narrow and specific goal can be measured, judgements about investments in plant or stock or staff can be made against this specific goal. If the proposed new member of staff cannot be forecast to generate profitable income to meet this goal then don’t take the burden on. Judge your decisions about investments in new tools or a prominent office location etc. against the goal. Decision making becomes much more simple, more streamlined and more appropriate when measured against your primary reasons for being in the business.

  • “I want to leave the business for future generations”,

The presumption in this goal is again far too vague to be helpful. I would urge that any business owner discusses succession with their children or other staff to be quite clear if that is the shared goal. A great number of staff do not want to have the responsibility of owning a business. Be very clear to establish who you intend leaving the business to. If there is no clear candidate for succession then perhaps you should consider preparing the business for eventual sale. Just putting it up for sale eventually is also far too vague a notion to become a goal. When establishing your goals consider something along the lines of;

  • “I want to sell my business to another company in the industry in 10 years, or by the time I am 55 etc.”

Such a clear focus will allow the business to position it’s investments and growth to meet these over-arching goals. The aim of any Strategic Goal, should be to simplify all day to day decision making. It allows the business owners and managers to prioritise spending and effort to a focused goal. It removes confusion and ambiguity. It speeds up the daily decision making processes.

  • ”I want to run my own bakery, repair workshop, graphic design house etc.”

These sorts of goals are often heard and stem most often from a discontent with working for ‘others’ rather than a specific desire to run a business. If you enjoy your trade more than the activity of running a business then one of the key goals that may be more appropriate would be;

  • “I want to grow the business over the next two years to a scale that will allow me to employ a general manager who can carry out all the administration functions of this business and free me up to return to the pasty bench, the lathe, the drawing board etc.”

These Strategic goals should be made familiar to all the staff within the business so that everyone, and every decision is heading in the direction the business owner has chosen. After all it is your business, run it don’t let the business run you or it will end in tears and failure.

In the next blog I will propose a Business Plan structure that I have found simple to implement and clear to use. It has proven it’s worth in over 50 businesses that I have worked with these past 40 years.

Thank you for reading this blog and please feel free to add any comments to the discussion.

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