We know that software has been a primary driver of huge gains in business efficiency with technology enabling business intelligence and transformation.
For example, ERP implementations of business systems software have been a cornerstone of many business transformation programs. Another example could be .Net framework in building another generation of applications and web services enabling real-time data capture and sharing thus enhancing business intelligence.
So no doubt technology has been a tremendous enabler and accelerator making it “easier” to accomplish business initiatives.
But should we be careful of what it enables to happen? ... And be careful of the destination it accelerates us too! Could it be there are ways that software makes it too easy to encounter risk and danger for the business?
What are the dangers of easy? Here are some actual business project situations:
Process, tools, or people – which are most important? Is it just a good academic discussion? But I warn; down inside of it is lurking the reason that business initiatives turn into wrecks.
It’s always been my beef with business project management education and certification that there isn’t enough focus on what is truly the most important component of successful program management. You would be challenged to find it in their lexicon of project management terms.
Is process important, absolutely. Obviously it promotes quality assurance and delivery consistency so to enable realizing value from business initiatives. Are tools important – of course; these software’s can enhance the efficiency of managing activities and resources for project management.
But are either of these why a project typically becomes troubled and in the ditch? No.
So why does a business initiative become troubled and mired? ...and how do you get it out of the ditch and back on the road to sure success? Typically, after peeling the onion, this is what’s needed.
I like hats, specifically caps. I collect ‘em and wear’em. Can’t help myself, got it honestly from my Grandfather. I have shelves in my closet with rows of them. Lots of different colors, themes, events and destinations on them from many locations; representing resorts, cities, states, countries and middle-of-nowhere-cool-hangouts.
I have caps that I wear for specific activities; like I’ve got one that I wear when I get in the boat and go fishing, another one for working in my workshop, and one I really like when I play golf, and on and on it goes. Same guy, but many different hats - for whatever role/activity, I’m enjoying at the time.
And so it is as well in the dimension of success for business initiatives. What is a single important ingredient to increasing value with business successes? That many times is under-valued?
Its been my professional lot in life for many recent years, and currently, to work with customer programs that were titled as “Business Transformation”. It’s quite an impressive and interesting title. As with most business enterprise software or consulting companies, this term has been well exploited in their sales and marketing materials. It’s been used to infer that completing a particular business initiative successfully will transform the business – meaning radically altering the state of the business to a new place of efficiency and profitability.
However, with decades of observation of these “under my belt” so to speak, it’s interesting to think about how well they have lived up to their description. In fact, for some, they may say such labeled initiatives indeed were transformative but not in a positive manner, and actually could be labeled as a black swan event. Here using the black swan as a metaphor, describing an event as one that is unexpected with major adverse impact, as coined by Nassim Nicholas Taleb.
Failed business transformation programs could fit that; starting out with great expectations of promise and benefits yet ending with huge losses and disappointment. How possibly could this happen and how to prevent?
From experience, I would say it is the simple yet profound “3 R’s” of business transformation realization that facilitate reaping the benefits of breaking through to a new dimension of business success.
Everyone loves a good fantasy story. Some of the best revenue gains at the theater box office were on movies in this genre. The populace desires to believe things will turn out the way we want them to and all live happily ever after. In our popular consciousness are stories as Beauty and the Beast, and Cinderella - who went from poverty to riches.
In the landscape of business projects, with the significance of a business’s goals and capital on the line, one would think that decisions to execute business projects are based on deliberate business case evaluation with reality of facts and the necessary involvement of those that will lead, support and deliver the determined value - since a business case is always done to evaluate the business initiative before approving the expenditure.
So then why is it, recent surveys have shown that nearly 50 % of significant business projects such as ERP fail to achieve even half of the planned business benefits? Why does this happen? What are the keys to realizing the business case so to gain a richer return on business projects?
Here’s how we have seen it happen and 3 keys to value:
The all-terrain vehicle veers off the road into the desert and the rig-up can be seen in the near distance at the well site. Yesterday the engineer had previously prepared for this well site technical services delivery when downloading the job and well data from the ERP system into the application on the rugged laptop.
At the customer’s well site, personnel, equipment and materials are ready as the downhole technical services delivery begins on schedule. During the well trips and passes the intelligent tool stack transmits data to the engineer’s application so accurate depths, pressures, temperatures and substance presence are captured along with personnel, times and other required ticket data that are entered to document the job.
After the engineer verifies the job and service delivery information onsite, data loads through the satellite uplink from the sun-seared well site into the ERP backbone. Now back in Houston our customer is realizing the real reason for ERP.
It's risky to force yourself to carry on in shoes that don't fit. You can hurt your feet, your knees, even your back. It’s imperative to have the right shoe for your purpose that fits correctly. They should be comfortable.
I found this to be true when preparing for a marathon. I joined a training program to help me learn what it took to successfully run a marathon. They led us in successively longer training runs to condition our bodies for the rigors of running 26.2 miles without stopping. When I first started training, I found the athletic shoes I was wearing hurt my feet when running longer distances.
I realized the need for properly-sized shoes that were designed specifically for running long distances that had the right degree of support and correct function for the foot. To complete a marathon you must have the proper shoe and fit to run the distance, which absorbs the heat and shocks along the way, allowing someone to go longer and stay on track.
You don’t want to be running a marathon and find that the shoe doesn’t fit. I’ve heard ERP programs described to be like marathons. It takes a lot of effort, time, and cost to successfully complete them. You don’t want to be running this marathon and find that you have relationships or systems that don’t fit.
It’s undeniable—if it’s profitable, then some level of risk is involved. What does that mean to you, the head executive or business owner? Well, since the risks won’t just disappear on their own, you have to learn how to successfully manage them in order to cut un-expected costs and maximize value.
Now I know what you’re probably thinking: I already focus on risk management. And you’re probably right. However, one thing we’ve learned in 17-plus years of PMO consulting experience is that the majority of companies don’t adequately plan for all business and project risks they incur. More specifically, more often than not, quality management is not included in regular risk planning.
Consider this experience: as a leading member of a customers’ PMO and working with all their partners, we discovered time and again that the significant contributing partners to the program did not have a stated quality management approach integrated into their methodology and procedures. Consequently, certain risks went undetected and unmitigated, providing the unfortunate opportunity for longer deliverable life cycles, higher costs, and lost value.
The solution? In the above cases, we worked with the PMO members to apply appropriate quality management approaches. It undoubtedly saved time and cost by preventing failures and unwelcomed surprises. In light of the solutions PMO consulting can provide, let’s take a moment to look at the base quality management framework that we would implement.
One size does not fit all; from Armani to Columbia Sportswear, clothing sizes that are available is a huge variable.
Then there is the custom fit experience. When working with a customer on a project in Hong Kong, I took the opportunity to meet a recommended tailor. They treated me well and took great care to measure me accurately and provided me with a great fit, and at a reasonable price. Happy customer.
Likewise, not all businesses are the same, and also not in the same place as to their growth cycle and specific needs. There are variables to consider for the right fit so to have a Project Management Office structure in place that is highly effective in delivering projects with value and is viewed as a successful partner by the business.
Unfortunately, studies have shown that PMOs have a relatively high failure rate on their first try (by some estimates, more than 50%). These failures are to a significant degree because of two factors:
- the PMO's mission and objectives weren't meeting the needs of the organization
- and the PMO wasn't matched appropriately to the maturity of the organization.
A new ERP system can revolutionize the manner in which your organization does business from the ground up. Organizations can enjoy tremendous benefits from them due to the significant software functionality and integration.
So then, why does it happen that after an ERP implementation, there are too often areas of low satisfaction experienced? Depending on how you handle the implementation process, you are certain to face a number of risks that could find your ERP project ending in dissatisfaction in some areas.
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