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Memo to the Enterprise: No More IT for IT's Sake (And a Mind-Reading Trick)

by Dave Hannon

February 2, 2012

By Dave Hannon


At a former job a LONG time ago, my manager carried a pager. A work pager. For work matters only. At the time, I didn't think much of it, because in those prehistoric days before the prevalence of cell phones, a lot of people had pagers. But in retrospect I realize most of those people -- including my boss, who was an editor, not a doctor or volunteer fireman to my knowledge -- really didn't need them. I honestly don't think I ever saw him use it. But they had them because they were the latest technology and to not have one made you look, well, out of the loop.

It was an example of "IT for IT's sake" in the enterprise. And it's pretty rare today.

Today, companies are much more strategic about implementing technology with a specific business issue in mind. IT component A addresses business issue B. And the enterprise software industry is not only supporting that trend, in some ways it seems to be driving that trend. The most important business priorities today are so closely intertwined with IT strategy, we're almost left to wonder which dog is wagging which tail.

Case in point: A report from the Boston Consulting Group this week outlined which organizational capabilities matter most to business. And while the list ofthose capabilities is long, the report found:

The correlations showed that all 20 types of organizational capabilities have an impact on overall performance&md ash;though clearly some have much more influence than others. “There’s a definite bias toward behavioral factors—in particular, leadership, employee engagement, and cross-functional collaboration,” said research leader Fabrice Roghé, a Duesseldorf-based partner at BCG. “But the best performance comes when those traits are backed by structural capabilities, such as a strong organization design and rigorous business processes and controls.

Okay, here's the part where I do my mind-reading trick. When you hear "employee engagement" you're thinking of IT's role, right? Maybe even SAP ERP HCM specifically. When you read "cross-functional collaboration" you thought about ERP's role, maybe PLM, Microsoft SharePoint, SAP NetWeaver Portal.

And I'm sure that you got downright giddy when you read about the importance of "strong organization design and rigorous business processes and controls." Those pretty much can't happen without some major IT support (this is might be where the tail starts wagging the dog).

So while this BCG report in particular focuses purely on business imperatives and doesn't even get into IT's role, there are clear and direct ties between the two in today's enterprise. Many of the business' top priorities simply can't happen without the right technology in place.

Lastly, I'll provide you some examples of companies I can think of that are using IT to support the capabilities that the BCG report has outlined.

Employee engagement:
Celestica said it is planning to use advanced analytics to improve employee engagement.

Nu Skin plans to implement SAP ERP HCM Employee Self-Service to offer employees easier access to and more control over their own information.

Cross-functional collaboration:
ACH Foods says it can get products from idea to market much faster because of the collaboration that its new SAP PLM system drives.

Allison Transmission has a similar story to tell about PLM.

Lockheed Martin uses SAP technology to collaborate closely with suppliers

And when it comes to IT's role in "rigorous business processes and controls" you'll want to read:

DuPont's Journey to Industry Standard Supply Chain Processes here.

And Dan Lipman, Senior Vice President of Operations Support and Core Process Innovation, Westinghouse Electric says in this article, “Global standard processes are the foundation for the future success of Westinghouse, and the Cornerstone project was a key to making that possible."

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