Digital Transformation: Systems Aren’t a Panacea
Systems integrators remain adept at marketing new technology solutions (e.g., ERP, CRM, etc.) as a panacea. Promising that the latest and greatest automation will bring a sea change in terms of productivity gains and reduced cost. Sadly, these large-scale initiatives remain highly disruptive and, for an enterprise’s workforce, anxiety-ridden. This is true before, during and after go-live. Worse yet, it’s common for such initiatives to come in over budget and below expectations, assuming expectations (i.e., a ROI / business case) were even set to begin with.
Sure, change is hard, and large-scale transformation efforts often cause things to get worse before they get better. However, top-performing organizations reduce the depth and duration of that pain using three key best practices:
1. Gearing towards the layman – Most of us aren’t technologists. And we don’t want to be. The ins and outs of a system have little to nothing to do with our day jobs. Yet systems-related change management efforts often start and stop with teaching people what new screes will look like and which buttons they need to push. In addition to being uninspiring, that quick switch to the tactical does little to help line managers and their direct reports (i.e., those actually responsible for using new systems) understand the implications on their jobs. In contrast, top-performing organizations have learned that they must start with the “why” and “what” rather than simply jumping to the “how.” Providing the bigger picture encourages and equips people to actually make the change.
2. Identifying and solving for unintended, negative consequences – A new systems implementation is bound to have ripple effects that affect adjacent processes and tasks. Said differently, because systems often change people’s roles, the work product they provide to others and the work product they receive from others, systems impact isn’t limited to just the work on the system. These unintended effects must be accounted for to prevent broader workflow from going haywire. Effective business process engineering requires that change managers ID, account for and mitigate those boundary areas leading up to and prior to go-live.
3. Tackling the organizational design and human capital issues necessary to generate ROI – A system in and of itself does not create ROI in the form of reduced costs or improved productivity (e.g., by shifting work from higher cost to lower cost labor and / or freeing time to take on new, more productive work). Capturing ROI requires careful review of how work is moving between roles and functions, the net increase / decrease in time across those roles and, as a result, where FTE counts need to go up vs. down to fit an organization's new workflow and burden.
There are situations where the decline phase happens on a more amplified and rapid basis, resulting in total elimination of a market space – i.e., a terminal point.
Pulling up a level, a new system is only one part of the modernization process. And, in fact, should serve as an enabler rather than the source of transformation. Connecting all the pieces together and asking the right questions in the right sequence is the key. Assuming a transformation objective is set, truly meaningful transformation efforts should follow a more streamlined, more sequential path, addressing 5 key considerations:
• Is your organizational structure equipped to meet your end-goals (e.g., high levels of responsiveness to customer service requests)? Are functional responsibilities clustered in a way that allows for ease of work and efficiency? Are all of the necessary roles filled and do staff possess the skills required to perform their job effectively? Today? In the future?
• Does everyone have a clear picture of their role? And that of others? Are there areas of overlap or redundancy that need to be corrected by assigning clear ownership?
• How should overarching structure and roles, including through technology, be tied together to achieve workflow?
• What tools, including systems, does the organization need to facilitate the above?
• Is there a mechanism by which staff are held accountable or incentivized to perform within the current environment? What additional governance layers / resets (e.g., revamped KPI structure) are needed to drive performance at the enterprise, department and role levels?
Implementing a new system can transform your business, but that transformation is not assured. Do you have the right starting point? And, if you find yourself in the midst of a large-scale systems integration effort, is your organization equipped to absorb that upcoming change?
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