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2008 and 2009 was a challenging period for business, world-wide. The under-performing economy has meant that very often the goals and visions developed in 2007 or earlier were not fully achieved. For many organizations there has been a “double whammy”; in that investments were made in process and technology, but returns were well below expectations. In other words the Business Case was not achieved and the Return on Investment was poor. Organizations were under pressure and many felt innovation and change had to be delegated to the “back burner”, to simmer until better times.
The experts are saying that we are starting to emerge from the recession and that there is a bright light at the end of the tunnel. Now is the time to look forward and prepare our businesses for better times. We must build on the lessons that the down-turn so sharply taught us and leverage the investments that have already been made in people, processes and technology. Now that the storm clouds are passing and the waters become calmer it is time to chart a new course to a better future.
It is now time to embrace some of that innovation and change – bring it forward and turn up the heat. The operational business units must lead the charge. Marketing and Product Development must revisit the marketplace to confirm what their customers need and to understand how they are moving forward. Similarly they must gather information on what their competitors are doing – with products, services and pricing. Internally, all business units should assess the processes and technologies employed to make sure that all unnecessary costs are removed from the operation.
One consideration is to address the question of what should be produced or operated internally and what can be more effectively and efficiently contracted for or “outsourced” to third-party organizations. Organizations should understand what is “core” and therefore provides a competitive edge versus what is “support”? In the IT function this can mean realizing that it is the data and its analysis that is core, not the operating of the hardware. A subset of the “sourcing” component of a strategy is the possibility of partnering with other organizations to jointly produce or deliver non-competitive goods or services; for example manufacturing, warehousing, logistics, sales, etc.
There is a role for the “supporting” business units such as HR, Purchasing, Finance and IT during this process. These groups should be assessing their resources, infrastructure and processes to really understand the current situation and develop a baseline from which cohesive and effective changes can be implemented in people process and technology to support the approved operational strategy. As with the operational groups, this assessment should also consider the financial and performance improvements that may be available through the full or partial outsourcing of any supporting business unit or the partnering with other organizations to jointly deliver supporting services through consortia.
Next month we will focus on what to do once the operational business units have established their goals and requirements. We will explore how the IT function and other supporting business functions can determine the most appropriate people, process and technology to support the corporate strategy and how, together, they can build a solid business case to proceed.
Not all organizations have the skills or resources to conduct assessments or develop a strategy in-house; particularly while they are keeping the business operating “as usual”. Any juggler will tell you how hard it is to keep your eye on more than one object and it usually ends up in a poor performance. It is also often very beneficial to use an unbiased third party to facilitate the process and to work with the business units as they look “inwards” to develop meaningful and achievable plans with clear and justifiable business cases.
By: Stuart Millar
Partner at Negenit Corp. (Outsourcing, Project Management, IT Strategy and Telecommunication)
To Contact Stuart:
E: smillar@negenit.com or on LinkedIn
Negenit Corporation,
6021 Yonge Street, Suite 485,
Toronto, ON M2M 3W2
T: 416-421-2017
F: 416-421-5549
Website:http://www.negenit.com
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CIO Series Articles: |
Assessment ● Consulting ● Compliance
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