“Does Your Business Need an Enterprise Systems Strategy?”
By Jim Myers, Founder, Praxis Analytics, Incorporated.
Business leaders live in a world that straddles the known and the unknown, past and future, with today’s demands receiving the most attention. The tactical needs of today crowd out learning from the past and making strategic plans for the future. The adage “Strategy without Tactics is a Daydream, Tactics without Strategy is a Nightmare” rings true, and nowhere more so than when it comes to your business systems. Without rugged, robust systems moving your business forward, the path to success is difficult. Systems provide you with the foundation on which business intelligence activities access past information to leverage knowledge and support good decision-making. Systems also serve as the basis for business analysis, looking forward to create models and make informed decisions to support strategic goals and operational objectives. Due to the widespread misunderstanding about their importance, system decisions are often delegated until there is a problem. Tactical decisions made about systems eventually come back to haunt a business when processes supported by those systems grind to a halt. The daydream becomes a nightmare.
Before system nightmares become all too real, it is a good idea to review your business strategy in light of your systems. This both eliminates risk and ensures team members understand your plans for the future. Your business has no Systems Strategy? You are not alone. Many business leaders are not unlike the fabled Emperor in Tolstoy’s classic tale, The Three Questions, facing decisions about when, with whom and on what to focus their attention. In this story, Tolstoy’s Emperor sought answers to three questions in an effort to chart his path forward –
- What is the best time to do each thing?
- Who are the most important people to work with?
- What is the most important thing to do at all times?
Seeking to answer these questions, the Emperor put out a call throughout his empire for assistance. He offered rewards to those who could provide solutions to his three questions. In response, a bevy of experts offered responses ranging from improved time management and increased devotion, to analysis, to creating a council of the wise, and appealing to the supernatural as well as conceding the task was impossible. Being displeased, the Emperor rejected the expert’s proposals and instead sought the advice of an enlightened man who lived a solitary life on a mountain. If you are not familiar with this classic tale, I suggest you read it for it is both entertaining and insightful. In the meantime, we will skip forward to discover the answers to the three questions. In the end the Emperor, in his quest for guidance discovers that –
- The most important time is Now. The present moment is the only time over which we have dominion.
- The most important person is always the person with whom you are, who is right before you.
- The most important pursuit is making that person, the one standing at your side, happy.
What do these three answers have to do with an Enterprise Systems Strategy for your business? As a business leader, you ought to consider the Emperors three questions in the context of your business systems. In addition, like the Emperor, you need to be leery of solutions offered by experts that do not address the intent of the questions. In developing a Systems Strategy for your business, some would suggest courses of action not too far removed from those initially provided to the Emperor. They would have you start by creating an exploratory group to exhaustively evaluate options, others might suggest you go directly to the system source for advice, others say give up before you start due to the impossibility of being successful. The creation of a group to search out options is good, but only when you are sure that you know what you are searching for, so the detailed evaluation of new systems tends to fit best into a project after the development of a System Strategy. In the same vein, approaching a system seller before you have a clear System Strategy invites distraction from your requirements. System sellers often will be more than willing to sell you an application that may, or may not, meet your needs at a price you may, or may not, be willing to pay. Finally, to give up and do nothing holds many risks, including an inevitable need to make decisions in the midst of systems failure. We all know from experience that decisions made in the midst of crisis have the potential to be both short sighted and expensive.
At the strategic level, the most important act in developing a business strategy is creating definition. Defining what your business is, where it belongs and how you set your business apart in the eyes of customers is crucial. Business capability definitions allow you to create and prioritize strategic goals and operational objectives that drive business success. Core Capabilities are what define your business as both unique and valuable. A key component of your business capabilities are those systems that form the foundation on which processes, and the people that use those processes, are able to accomplish goals and attain objectives necessary for success. Without strategic clarity and definition, your systems are likely to evolve tactically over time, without a plan, often on top of the ruins of past systems. That is what tactics will get you. The key is to act before systems that ought to be assets turn into liabilities. Let’s follow Tolstoy’s lead and see where these three questions lead us in terms of an Enterprise Systems Strategy.
Question #1: When should a business develop it’s Enterprise Systems Strategy?
Answer: The most important time is now because it is the only domain over which we have control
Act now. The past is gone and the future has yet to arrive – you are in the present. Act now before your systems drag your business down, becoming a liability. Systems are primarily the means used to control activities. A system in this context is a set of related assumptions, rules and devices that control and focus (analyze, measure, monitor, evaluate, resource, manage, support) activities towards particular objectives. Within your business, most of these activities are the processes that people use to accomplish work. Processes and systems work together to ensure that business objectives are met (effectiveness), and that waste is minimized (efficiency). Wasted time is perhaps the most detrimental of all wastes because time is finite; once time is gone there is no recouping its loss or clawing it back. That is why it is detrimental to wait until systems fail before acting. Systems that no longer support effective resource deployment and efficient processes do not get better by themselves. Like the Emperor, you now know when to act: there is no time like the present to develop your Enterprise Systems Strategy.
Question #2: Who are most the important people in developing an Enterprise Systems Strategy?
Answer: The most important people are those around you that you rely upon for success
This is a team effort. A business is most reliant upon three groups of people: team members, suppliers and customers. Developing an Enterprise Systems Strategy takes into account all three groups and avoids missteps in addressing obstacles that compromise performance. First, the team members that surround you and work daily with your systems and processes are intimately aware of the systems issues you face. As the people most involved with executing those activities linked to your success, your team holds valuable insights about current obstacles and benefits gained in addressing systems problems. Second, if your systems do not enable clear and precise communication with suppliers, the chances of their disappointing you increase. Ask your suppliers how communication (quote requests, specifications, purchase orders, confirmations, etc.) can be improved. Suppliers provide important ingredients to your success; they deserve a seat at the table to help you improve your systems. Finally, ask customers how you are doing and take their responses seriously. This important facet of systems planning is often overlooked. Team member insights, supplier communication and customer feedback about system improvements directly translate into those requirements that affect systems upgrades and replacement. Like the Emperor, you now know who those important people are around you, and who to work with in developing your Enterprise Systems Strategy.
Question #3: What is the most important thing about an Enterprise System Strategy?
Answer: The most important pursuit is seeking satisfaction for those around you
Seek satisfaction. Believe it or not, satisfaction has a seat at the table of Systems Strategy planning. Why? Satisfied team members do good work and devote themselves to serving your customers. Satisfied suppliers work hard for you, seeking to go beyond the minimum to ensure your relationship is solid and business is growing. Satisfied customers return, again and again, to buy your goods and services and therefore fuel business growth and the attainment of your goals and objectives. Satisfaction is directly related to the reduction of anxiety. You pay dearly for anxiety as an unseen cost of doing business with systems that do not support your needs. Taking your Enterprise Systems Strategy seriously and devoting time to identify systems faults clearly signal to those around you (team members, suppliers, customers) that you have their best interests at heart and are devoted to their success. Not everyone can be completely satisfied all the time; few people expect that. What they do expect is that the recurring sources of anxiety (in this case poorly performing aspects of your systems) are acknowledged. Addressing systems problems before the systems become a major impediment to everyone’s success, keeps relationships positive and productive. Receiving timely input about your needs and assessing your systems goals, objectives, and requirements allows leaders to be confident in the steps taken to minimize systems risk. That confidence comes from being aware of your systems and understanding their current state and options for the future. From confidence comes the satisfaction that you, like the Emperor, know the most important thing to do, and can make the best decisions in developing your Enterprise Systems Strategy.
Every business needs an Enterprise Systems Strategy to support their overall plans for value creation in the future. A good first step is clearly defining what your system needs are in the future – as stated above, there is no time like the present to define those needs. The second step is to decide how best to achieve those systems requirements that support business success – that is the result of dedicated and intentional analysis in the context of your strategic goals and objectives. Only after gaining clarity in terms of your requirements should you move to make any decision about the suitability of your systems and the need to update or replace them in the future. Now, like the Emperor, you have discovered the answers to the three important questions and can prepare for the future by developing your own Enterprise Systems Strategy.
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