The Trouble with Enterprise Software

Cynthia Rettig has hit the nail on the head in her article “The Trouble with Enterprise Software” (http://sloanreview.mit.edu/smr/issue/2007/fall/01/)! This is based on my personal experience with multiple SAP implementations. Whenever an organisation commits to the levels of investment required to implement corporate politics will come into play. Executive stakeholders in the project will spin the ERP implementation into a success even when it the monolithic system stifles an organisation's ability to change. And that's the crux of the problem. It's not that ERP systems don't create efficiencies, it's the efficiencies are based on a point in time. ERP systems often cement an organisation into a particular way of doing business. As the business environment changes, the cost of changing business processes within the ERP systems outweighs the potential benefits of market opportunities on a case by case basis. This is particularly true for speculative new products and new market opportunities where the revenue growth is uncertain. The high cost of changing these systems often makes the business case for new opportunities inviable. As a result, line of business managers may be forced to use smaller systems to launch new opportunities thus adding to the complexity of enterprise IT environments. Enterprise SOA will not be realised because the solutions developed by most vendors are too heavyweight and cumbersome. The best examples of SOA in action are web mashups. Organisations striving to achieve agility by implementing heavyweight middle tier stacks are barking up the wrong tree. Why is it that one doesn’t picture an ocean liner, or a 747, or anything that is large and complex when we envisage “agility”. We always picture lean, lightweight, hyper… Companies should look to small, lightweight, simple services to deliver agile business processes. Leave the legacy processes to the ERP systems but build future nimbleness on lightweight web centric architectures.

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ERPs Stifle Business Change

Cynthia Rettig has hit the nail on the head in her article “The Trouble with Enterprise Software” (http://sloanreview.mit.edu/smr/issue/2007/fall/01/)! This is based on my personal experience with multiple SAP implementations. Whenever an organisation commits to the levels of investment required to implement corporate politics will come into play. Executive stakeholders in the project will spin the ERP implementation into a success even when it the monolithic system stifles an organisation's ability to change. And that's the crux of the problem. It's not that ERP systems don't create efficiencies, it's the efficiencies are based on a point in time. ERP systems often cement an organisation into a particular way of doing business. As the business environment changes, the cost of changing business processes within the ERP systems outweighs the potential benefits of market opportunities on a case by case basis. This is particularly true for speculative new products and new market opportunities where the revenue growth is uncertain. The high cost of changing these systems often makes the business case for new opportunities inviable. As a result, line of business managers may be forced to use smaller systems to launch new opportunities thus adding to the complexity of enterprise IT environments.

Enterprise SOA will not be realised because the solutions developed by most vendors are too heavyweight and cumbersome. The best examples of SOA in action are web mashups. Organisations striving to achieve agility by implementing heavyweight middle tier stacks are barking up the wrong tree.

Why is it that one doesn’t picture an ocean liner, or a 747, or anything that is large and complex when we envisage “agility”. We always picture lean, lightweight, hyper… Companies should look to small, lightweight, simple services to deliver agile business processes. Leave the legacy processes to the ERP systems but build future nimbleness on lightweight web centric architectures. in action are web mashups.

Spreading corporate FUD

20 August, Herald Sun

Facebook time-wasters could cost $5 billion a year

http://www.news.com.au/story/0,23599,22273758-2,00.html

This is a typical negative and cynical corporate perspective of a new social phenomenon from the unbiased perspective by SurfControl Chairman, Richard Cullen. As if there is no vested interested preaching FUD (fear, uncertainty and doubt) to sell more licenses. The article actually ends with a more objective and realistic view from Tammy Tucker of Haystac.
Rather than fear social networking, corporates need to understand why so many people are joining these networks and using them to express themselves and to connect with other like-minded people. Platforms, like facebook, provide people with a new way to communicate to narrow segments of a very wide audience. This is personally empowering. Banning facebook is a similar reaction that many organisations had 10 years ago - banning the Internet and world wide web. Today, no company can survive without Internet/Web connectivity.
If your employees are not engaged, not motivated, not productive, or if you haven't tapped into their real potential and inspired them to contribute to your organisation; don't blame facebook or myspace or other social networking platforms. Blame your board and executive leadership for not creating and inspiring vision and blame your middle managers for being job holding, initiative blocking, f--k wits.
People want to do something worthwhile. Employers need to make the time people spend at work worth being there.

Enterprise Transparency and Collaboration in a 2.0 World

Organisations that view the world through traditional conservative lenses are squandering their most valuable asset.

This recent article (http://blog.wired.com/27bstroke6/2007/07/nearly-ten-perc.html) highlights the growing concern about outbound e-mail communication and now Web 2.0 collaborations like wikis, blogs, discussion boards, etc. Organisations should shed the archaic, draconian controlling mindset and “open up” to social collaboration. At the board and executive levels companies tout the virtues of transparency and collaboration but the shackles of political opaqueness and protecting self-interests still dominate corporate culture.

Web 2.0 is all about collaboration and encouraging everyone to participate and contribute in discussions and debates about everything. Obviously, there is appropriate and inappropriate content. Most users are reasonably aware of what is acceptable or unacceptable in the workplace and yes, there will always be those that intentionally and/or maliciously abuse any system. But these fringe cases can be governed by policy and process. Collaboration groups or communities are also self-governing. By giving members the ability to tag content as inappropriate the community can encourage self-regulation.

Raising fear, uncertainty and doubt levels by highlighting the risks of openness invokes the wrong mindset and is a bad approach. Suppressing the workforce’s ability to collaborate within organisations is throwing out the baby with the bathwater. Participation levels in social networks like myspace and facebook is growing astronomically. Organisations must ask themselves, “Why are so many people participating in social networks?” and “By definition, is the workplace a place designed for social collaboration?” If so, is the suppression of collaborative communication counter-productive? What are organisations that don’t “open up” actually saying about their staff and their relationships with one another? The message can only be perceived as negative:

“We don’t have trust.”
“Your opinion or thoughts are not important.”
“You’ll embarrass the company.”
“You’ll abuse the privilege.”

All bad…

Alternatively, by establishing some simple policies and guidelines for use (nothing to onerous please) organisations can unleash volumes of information and knowledge allowing everyone to engage more deeply with each other and the organisation itself. Moreover, the information generated could point the organisation towards new directions by highlighting internal inefficiencies, customer trends and market opportunities. Improved social collaboration will also stimulate organisational innovation. This can all happen without increasing costs.

The advantages of collaboration on social networking platforms are significant. Imagine if your organisation were to loosen the reigns enough to allow your “most valuable asset” to contribute more to the organisations business objectives and to evolve organisational culture to the 21st Century. Face it, it’s inevitable… people are already collaborating, blogging, networking, etc. You can’t beat it, so join it and reap the rewards!

Enterprise 2.0 (and Web 2.0) we've been doing that for years... NOT

Viewing Andrew McAfee and Tom Davenport's debate at last week's Enterprise 2.0 conference and reading some of the comments on the blog has confirmed my views about the lack of clear thinking regarding E2.0 and W2.0. With all due respect to Tom Davenport who has been in IT since 197x, you got it wrong dude!

The notion that E2.0 is nothing new (as argued in the debate) and that the technology is all just a rehash of stuff that has been around for ages is RIDICULOUS!!! Ubiquitous access to information through the Internet, wireless and mobile technologies, platform independent applications, affordability and wide spread adoption of technology, the ability to share information publically, wide spread platform and application interoperability through XML, HTTP, Web Services, etc., are all contributors that have converged to create the unique "wired" society we live in today. And businesses are part of our social construct.

I concur that technology alone won't change large bureacracies market pressures will. But the technology enables the change. Without there would be no basis for change. The millions of users that are flocking to social networking platforms cannot be ignored.

Enterprises need to understand and embrace the social networking phenomenon rather than sitting back skeptically saying this is nothing new or an unachievable utopian vision. Harnessing the information (content) that is being created today, understanding what it means and where we are going, and being able to quickly take advantage of it will provide organisations' a strategic advantage.

Organisations that fail to embrace this new paradigm, at best will miss out on opportunities and at worst, be overtaken by agile organisations capable of evolving.

2.0: the beginning of the end of corporate computing

The 2.0 phenomenon demonstrates the speed and agility of the Internet. The volume and quality of services now freely available on the Internet is staggering. Many of these services are (or should be) competitive to corporate services. Should corporations consider Gmail vs their internal mail systems. Gmail provides a better service than the corporate e-mail systems that I've had the displeasure working with. Gmail wins out because of higher availability, more storage space, easier to find mail (search), lower maintenance, better access (available on my mobile phone - not a Blackberry), ubiquitous access (any browser, any computer), and lower costs (free) ... with all of these advantages why aren't more organisations using Gmail (or other comparable free e-mail services) for their corporate communications?



This is just one example of "information infrastructure" services that are now freely available. Calendar, data storage, information management, blogging, wikis, etc are all free. Open Source software also provides free local or network based applications like content management, CRM, ERP, office automation, operating systems, etc. Just about every kind of application or service that you can think of today is either available as a free online service or open source application.



So why aren't more organisations adopting this new paradigm? I believe that corporate IT departments are feeding the FUD (fear, uncertainty and doubt) factors to protect their turf. This is done without consideration of the real owners of businesses - the shareholders. Internal IT departments (and many large technology vendors) have a lot to lose if they embrace 2.0 principles.



Rather than resist the obvious, these organisations should be the promoters of change and evolve their roles to adapt to the new 2.0 world. Go agile, lightweight, free and open and give up the heavy weight, proprietary, slow, costly models that are already obsolete. The 2.0 movement is showing us that good technology can be delivered quickly, cheaply, with small teams and to high quality standards. The environment has changed. Nicholas Carr is basically right. It's time for IT departments, vendors and systems integrators to evolve or face extinction.

What is the future of corporate IT?

In his recent Blog, "Mashups: The next major software development model" http://blogs.zdnet.com/Hinchcliffe/?p=106 Dion Hincliffe talks about mashups, SOA and Enterprise 2.0. I like it! Dion is onto something quite similar to what I've noticed here in Australia.


Consider this scenario about a ficticious company that has embraced Enterprise 2.0:


Scenario:

The scenario depicts the first day for Bob, a new sales person at Kinsey Distribution. Kinsey is a wholesaler and distributor of electronic and computer products. Kinsey has fully transformed to Enterprise 2.0.

Day 1

Bob reports to his first day at work and his new manager, Ed, introduces him to their HR representative, Tina. Tina sits Bob down at a cubicle in the HR department and pulls up an electronic form through their Intranet. She starts filling out Bob’s details, confirming the details as she enters them into the electronic form. She completes the first form and submits it.

A couple of seconds later a new page is presented with Bob’s login details and a temporary password. She then asks Bob to take the drivers seat and just to follow the prompts. Bob, is asked to change his password and to activate the 2 factor authentication token that Tina provided him. Tina is then able to leave Bob to continue working through the Kinsey Induction Process. “Remember your login and user password. The induction process is all on line and will probably take until 12 noon. Feel free to take breaks when you want. I’ll show you the toilets and tea rooms and my cubicle if you have any questions. You can also just call me on my extension. This computer has a soft phone; you can click on the click-to-call icon to call me.”

After the quick tour Bob returns to the workstation and logs back into the intranet using his user name and temporary password. Kinsey allocates all employees computers based on their job role. As a sales person Bob chooses a laptop and PDA from a wide selection which are both salary sacrificed. The computer is Bob’s to use as he wishes. If he had owned a computer that he wanted to use in his role as a sales person Kinsey would have only required that the computer have a minimum technical specification and appearance level. He can view current vendor prices and availability for laptops and PDAs. Each time he selects an item the price is entered into a calculator that displays the costs, monthly salary sacrifice, and tax impact.

Kinsey pays a fixed price per month per employee for mobile phone and wireless usage, again based on a person’s role. The employee is responsible for amounts over and above the fixed amount and receives a payroll adjustment. At the end of each financial year a tax report is also provided for each employee to assist with their professional deductions.

Bob makes his selection, receives an order number, tax invoice, and delivery date of 2 days. Bob chooses to pick the computer up and receive a bit of an introduction from the retailer.

Based on his role as a sales person, Bob is provided access to a suite of applications and services. As he goes through his induction, the intranet presents him with the applications he needs to use and confirms his identity by the first time he logs into each application There are also online video tutorials for each application. Bob must review and acknowledge that he has completed the tutorial prior to gaining access to the application. The tutorials are always available – just in case he needs a refresher course.

Kinsey has chosen to no longer control end user computers and uses the vendors that they purchase from for warranty and repair work. Kinsey has decided to let users control their own computers the same way they do at home. Kinsey provides a network port at work and all applications are accessed through the intranet. Certain applications require the token for two-factor authentication. Certain roles also access applications through a WAP Browser on PDAs. There are also administrative and office/desk bound roles that access the intranet with thin client terminals. Each user is responsible for their information management with performance metrics associated with accurate entry and proper use of information.

All business applications are web enabled and most applications are actually mash-ups. The Kinsey IT department has pulled their firewall back to protect the core applications and data centre. IT services are provided via web services with the onus placed on the user to use services when they need them. Kinsey publishes all services making them easy to find and simple to use. Also the induction process ensures that new employees are aware of the essential services. For example, back ups require the user to create a folder on their C: drive and store all business documents in that folder. By clicking on a back up service Kinsey IT will automatically back up that folder whenever the computer is connected to the LAN or when the user manually chooses the option.

Kinsey’s IT department has 3 main roles:

Security: information, core applications, data centre,
Development: Service enabling
Operations: Core applications, monitoring and reporting SLAs (communications, infrastructure, applications and services), managing capacity, Service Desk, vendor support

There is only one infrastructure supporting internal and external users.


Day 7

Bob is now familiar with the basics of his role and computing environment. He has received a list of current customers, prospects and suspects in his territory and understands Kinsey’s requirements and expectations for contact and sales.

Bob is ready for his follow up training with Ed. Ed meets with Bob and walks him through a mash-up that he uses as his home page. It is composed from several widgets which display real time information about the sales people that report to Ed, customers, company stock on hand and on order, order status and the status of 2 projects currently underway where Ed has been identified as a business stakeholder.

Ed takes Bob through the “Kinsey” widget factory where services are made available for Bob to create his own mash-ups. Ed explains that it is important for Bob to understand how to create a mash-up because he’ll need to help his customers go through the same process. There are mash-up templates for general use but customers tend to want to see the information that is important to them, when they want to see it. Helping customers with mash-ups is one way to better understand what information is important to customers (and better understand the customer) and also to show them information that they may not know is available. Customer use of the Kinsey extranet also reduces Bob’s customer support requirements because they can see the same information he can (that’s relevant to them) without him. He can focus his time on helping them build their business around Kinsey’s products and services. Bob’s customers can also let their customers access the information available from Kinsey through their own web sites as mash-ups. End user customers can track their own orders, receive SMS, e-mail and fax messages that are all branded with the retail customer’s brand but the information is being provided by Kinsey.

Ed explains to Bob, “We have been able to increase our market share significantly by extending to our customers and their customers, the framework that provides transparency of information, straight through processing, and reuse of services that Kinsey has developed. Every time one of Kinsey’s competitors drops the ball because of poor information flow Kinsey seems to find a new customer. The more one of our customers sells, the more they appreciate the services that we can provide them. Once we develop a service anyone inside or outside the company can use it. This philosophy allows us to get immediate feedback, ratings, and host vibrant discussions, about products, services, consumer experiences, etc. By letting our constituents .., people… express themselves and by listening, we are in touch with what is happening in the market right now. This allows us to respond to market forces in an agile manner.” This has been made possible whilst reducing IT spend because Kinsey now focuses on IT activities that add value to the business. They get maximum value from the Internet and web by acting as a Service Provider on the Web.

Bob loves the way Kinsey thinks. He uses his computer to do research and for his post graduate work and personal entertainment. He has his music collection and iPod connected to the computer as well as access to Kinsey applications. He is also being treated like the accountable, responsible, professional he is and not some computer Luddite that will somehow destroy or corrupt the corporate network.

Kinsey’s corporate network is a rich endpoint on the Internet. Kinsey creates services that improve its ability to communicate with its customers and add value to their transactions and relationships with their customers.

Bob creates his own mash-up, viewing customer appointments, open orders, customer order history and territory penetration. He creates another mash-up to build his territory sales strategy and gives Ed access simply by using Ed’s e-mail address. Ed schedules a weekly meeting with Bob for his first three months and lets him know that after that, they’ll meet one-on-one monthly and at the team meetings. Ed also tells Bob that he’ll join him for a day of customer visits unannounced sometime soon.

Bob is now ready to go out on his own. He has, at his fingertips, access to all the corporate information and knowledge he needs to be effective in his role.

Some questions to consider:

1. Do you think this is a plausible future scenario?

o If yes, when will this scenario be possible?

o If no, why won’t isn’t it plausible?

2. What are the obstacles of adoption?

3. What aspect of the scenario appeals to you and why?

4. What aspect does not and why?

5. What would happen in your industry if a competitor introduced these types of capabilities today?

6. What impact would applying this scenario have to your organisation?

7. What impact would applying this scenario have on your IT department?





What are your thoughts?



My responded to the Hincliffe Blog is included below.



Another nail in the coffin of corporate IT


This article highlights another reason why corporate IT is on its way out. The ongoing excessive and wasteful corporate spend on IT will decrease when business executives begin to understand the power the of Web 2.0 and the limitations of traditional corporate computing models. As corporate IT organisations try to figure out how mashups work, information is being disseminated and consumed at extraordinary speed on the Internet. Yet, many (if not most) large corporations cannot share information even internally (let alone software components) because of poor architecture, poor planning, bureaucracy, etc - but mostly lack vision. When small organisations, with little to no budget, can publish high quality information quickly and dynamically on the Internet; and large organisations trying to do the same thing, take months and spend millions of dollars - something is fundamentally wrong.



Many professionals are more productive on their home computers connected to the Internet than on their company machines "locked down" by outdated SOE standards. Large organisations need to improve the value of their IT spend by pulling back the firewalls to protect only core applications and unleashing their users to the same open environment that we deal with outside of work. Corporations should develop strategies that harness and expose corporate content and capabilities as widgets for use in mashups through their web sites for consumers, partners, suppliers, etc. Surely, this would allow them to add value to their relationships. Rather than waiting for vendors to deliver some COTS mash-up tool that is "Enterprise Ready" why not just begin to use what's already available to gain some real experience. Also, focus on exposing existing information locked in legacy systems. In order to remain relevant, reduce costs, increase productivity, etc. pull back the firewalls, remove the "lock down" of PCs, expose content and services and set your knowledge workers free.