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28 August, 2017
by PeterBj
2 Comments

Catch the Rising BI Star

Rising Star

 

The need for transforming data into intelligent information to boost business performance is creating angst among many business people. They need something better than what they have today. Business Intelligence tools are not new, and many tools can ultimately perform similar functions, but the technical toolset of the developer, ease of presentation, and cost of use is drastically different.

Some companies will be fortunate to have employees that understand the difference and see the benefit of being an early adopter of Microsoft Power BI. Other companies stay with what they have and therefore pay more for being less informed.

Prepare to Win

If your organization wants to take advantage of the big data revolution, you’re going to need a business intelligence platform that can make the most of it. BI software is crucial for interpreting and examining data, whether you’re putting together some single reports, or performing a full battery of data analyses.

The BI market is saturated with old products. How do you evolve from something you’ve built your company around into something new and better? Or, in a broader sense, how do you keep your company competitive? No one should need to be reminded that change is the only business constant.

Many years ago, BCG developed a product life-cycle matrix based on market share and growth. “Dogs” are the low market share and low growth products. Single market BI apps fall into this category. “Cash Cows” are high in market share but low in growth. They keep the money rolling in but their days are limited. “Rising Stars” are products that are low in market share right now but high in growth. This is where the future lies.

Lower Cost and Higher Performance

Microsoft Power BI will initially live side by side with legacy BI tools. This coexistence may continue for several years. A mix-and-match strategy provides business dynamics but should not be a sleeping pill for companies who want to minimize BI portfolio’s complexity and cost. Don’t view your old BI star as immortal; see it as the aging Cow it is.

Microsoft has narrowed all significant feature gaps. For the second year in a row, Microsoft is placed furthest in vision within the Leaders of Gartner’s 2017 BI report. Get the report here and learn more about Microsoft’s favorable standing.

Microsoft won’t waver in its commitment to Power BI – you can be sure of that. Microsoft will continue executing on its successful “five strategies,” which states five seconds to sign up, five minutes to wow the customer, and five times more value for money, i.e., 80% lower cost than other (so called) leading BI products. Bundled with Office 365 it may even be less than that…

Opportunity is Now

You’ve still got time, but you shouldn’t waste that time by ignoring the advantages Power BI offers. If you do, you’ll eventually find yourself trying to get milk from a Dog. You must either adapt to new technology or get buried by them.

Better, faster, and cheaper are vital ROI issues and measures. The sooner you join a rising star the longer time you’ll enjoy the benefits of recurring returns on your investment. Timely is no small thing. Darwin’s famous theory might as apt been called “Survival of the Timeous.”

Evidence of Power

Once the data was connected to Power BI, it took my son and me two hours to develop a comprehensive Warranty Management Dashboard, with capacity to filter and drill down each graph. As great as it is, Power BI comes with a warning. Your appetite grows as you eat. Power BI talks to our intellectual curiosity; the desire to explore and know more.

Warranty Dashboard

 

13 January, 2017
by PeterBj
Comments Off on A Forty Year Perspective on ERP and Digitization

A Forty Year Perspective on ERP and Digitization

Looking forward by looking back

With more than forty years of experience from digital transformation with ERP and 2017 quickly taking off, it felt like an invitation to reflect on what has been and what lies ahead when seeking to deliver better value to users of enterprise software.

January 1977, half a year after having left high school 1 year before exam, having past IBM’s programming ability test with distinction and as a result employed by the pioneering ERP vendor Movex and educated through numerous IBM courses, I was nearly 19 years old and full of energy to serve customers and make a difference.

Learning from Practice

When acquainting with the real world at customer sites (where I spent most time as we could not afford our own computer), I was enamored by the ease and speed the computer made me carry out tasks the typewriter and calculator made tiresome and error-prone.

In my role as a programmer, I improved my ability to make the computer do magic by understanding how the resultant functionality enabled digitilized business processes where users are not just keying in data but actually using data as information.

Customers were the biggest source of inspiration. I felt great when they were happy, such as when a production manager said: “Now when I see the result, it was definitely worth the time and money invested in explaining our wants. What impresses me is that the solution you delivered not just meet our wants, it also fulfills our needs.”

Due to our success the volume and size of the projects increased, forcing me to practice more management and teamwork. In doing so, I realized we could energize more power together than we could one by one, why collaborative efforts became a way for us to deliver more value for less money to customers.

There was no doubt in my mind that the life of the users was about to dramatically shift for the better; the outcome of the enterprise solutions we delivered would transform paper-pushers to knowledge workers and send productivity to new heights.

Overcoming the Obstacles

But not everyone I met shared the same enthusiasm of it all. The resistance, to the point of anger at times, that people displayed when faced with learning how to use the applications we offered was fascinating to watch but tricky to handle.

The majority of the users had been in the workforce for many years and had been doing fine without computerized applications. Often they made clear to me that things were fine the way they were, so why change?

I am positive that to many customers, I appeared as a bright but naive youth with no experience to understand that the old way of doing things would prevail and the technology I gushed about would fade away as a failed experiment in time.

There were different approaches to avoid changing. I remember a warehouse manager asking me, “Can my job be preserved until I retire next year?” His wish was fulfilled because we could not automate all his duties. A year later, the missing pieces was filled out making his job obsolete, but then he was happily retired.

Recently, I met with a process owner replying, “That is not possible!” After the “impossible” was demonstrated, she rhetorically asked, “Why is this not already implemented here?” A mind that is stretched by a new experience can never go back to its old dimensions. But why must it take so long to be aware of what is possible?

Progress is inevitable. We can, and will create the economy of the future when we remember that the function of technology is constantly empowering people to do things that were previously impossible.

Just as we had to find a way to help bridge progress in the early days of enterprise computing, we need to do the same today as we puzzle over our next move and wonder how to help our business and customers successfully through a new wave of digital transformation.

Successfully Going Forward

To cross the divide, we are going to need to see things from a fresh view, which involves not just technology but just as much customers, colleges, and culture:

  • We need to adjust our approach to speak uniquely to customers thinking and their real needs. Therefore, we will need to find ways to understand what customers want, say, and do. What we hear may challenge our business model while some requests may fly in the face of “what we have always done.”
  • There is a new generation coming to play. We must give room for them to fail, learn, and thrive to bring the world forward, while knowing that bureaucracy and Taylorism will not impress them. And they are right; Taylorism being about static optimization of work imposed by “those who know” on “those who do” is not how competitive advantage originates in the digital age.
  • Delivering value is so important that it needs being rooted in an authentic interest and focus of understanding what has merit in the customer’s eyes, not yours. The winners will have a culture where self-reflection and seeking smarter, less wasteful solutions across the business modus operandi is the ideal.

As you contemplate on transforming your organization, as you search for the right way to steer into the digital age I believe these seven provisions can help getting it right:

  • Take a genuine interest in the customer. Listen first; take the time to hear what they are saying, and why they are saying it.
  • Be prepared to change, based on what your customer is telling you. Do not give your competitors an opportunity to serve your customer better and faster than you can.
  • Be aware; sometimes the problem lies not with ERP but with the demand for quick fixes or the need to cure underlying structural problems.
  • Ready to invest, even if it means a short-term loss for long-term gain, to bring forward real benefits to your customers.
  • Honesty about your company’s capabilities, from the view of the customer will pay off. Bear in mind, they like to know what is going on, so you need to constantly feed them with new information.
  • Assure you have a clear vision of the desired outcome of your digital transformation. Be proactive.
  • The secret of winning change is to focus all of your energy not fighting the old but on realizing new and better solutions.

21 November, 2016
by PeterBj
Comments Off on Three Attitudes to Digital Transformation

Three Attitudes to Digital Transformation

pathfinder

There is solid research showing that transforming toward becoming more digital pays off with huge dividend. How this possibility is realized or lost depends on behavior; which can be categorized into three groups: 1) redefine and reposition, 2) adopt best practice, and 3) business as usual. Each one of them is believed leading to a certain result: You win, you follow, or you lose.

So far, this analysis answers two questions: 1) how companies drive or react in regards to opportunity and 2) what the result is likely to be from each type of behavior. But it does not answer the question: Why?

There is a stage before behavior, known as attitude. Guided by experience from meeting with 1000s of managers ranging from CEOs to process owners and supervisors I have found three distinctive attitudes that can be labeled: Cave Dwellers, Light Chasers, and Pathfinders.

Cave Dwellers

This attitude reminds us of Plato’s 2,300-year-old allegory of the cave. In Plato’s story, we are all chained in a cave for eternity with our faces toward the wall. Behind us, stick figures are dangled in front of a candle, so shadows are the only reality we know. By chance, someone breaks loose, staggers toward the opening of the cave, sees sunlight, and realizes the limited and false view of reality inside the cave.

This person returns to the cave to say that the vision that we have spent our lives focused on is only a shadow of the real truth. Unfortunately, to those who have never seen anything else, the message sounds crazy. So naturally, they declare him insane and put him out of his misery.

Plato’s story helps describe a population of managers pleased with what they already have. No need to consider anything else. They will sit there until getting blindsided by competition. They do not realize that if competitors are getting better and they are not getting better, they are getting worse, on their way to losing. The prospect for cave dwellers is as simple, challenging, and scary as that!

Light Chasers

Light chasers are the polar extreme of Cave Dwellers. These managers remind us of children who are tricked by the “light game.” One clever kid shines a flashlight against a dark wall and dares the others to catch the light, saying, “When you catch the light, you win.” The chasers run toward the wall, but just before they get to the beam of light, a flick of the wrist by the flashlight holder starts the whole chase over. Most kids smarten up and learn that this is not a game worth playing.

Too many managers are chasing the light. The difference is that the light is now the latest and most fashionable technology. Light Chasers are digital fashionistas, living by the credo, “Buy the latest, and you will be the greatest.” But technology is not as Light Chasers would like to believe an end in itself. Therefore, they often fail with the implementation, looking to the next “big thing” before they learned to use what they just bought. By accident it happens they are successful, just like monkeys picking out the best shares.

Pathfinders

Pathfinder’s focus on serving more customers more profitable. They recognize that digitization is a driver of business advantage, so they look for solutions meeting their organization’s business goals with that as a basis. For them digital transformation as both a strategic and tactical capability.

Impossibility is not part of their vocabulary, and neither is naivety. Pathfinders asks the right questions: How can we win new customers? What digitization opportunities are best for us? They are proactively pushing forward; taking adequate digital technology to production as fast as possible.

If others – after the fact – find the pathfinder being on the winning path it is much appreciated. Such affirmations will yet not make them believe they found the ultimate solution. Above everything, they are pathfinders. It is among the pathfinders we find the winners and fast followers.

9 December, 2015
by PeterBj
Comments Off on What is Ahead for ERP in 2016?

What is Ahead for ERP in 2016?

Two Roads Diverge

The New Year is quickly approaching. As we reflect back on the past year of ERP, and before making predictions for the year ahead, we must first acknowledge the upcoming trends of 2015, which are likely to impact next year.

  • Traditional Client/Server ERP is Dead
    • At Sage’s annual conference July 2015, CEO, of 14,000 employees, Stephen Kelly announced that they are dropping the acronym “ERP” from their product names and said, “We believe ERP is a 25-year-old term, characterized by cost overrun, and in some cases even business ruin. To the finance directors of the world, ERP stands for Expense, Regret, and Pain.”
  • Faster Development and Greater Flexibility
    • Salesforce’s San Francisco Dreamforce software event is the biggest in the World. It attracted over 100,000 people hearing about the advantages of CRM and the cloud. Salesforce is yet, even more eager to sell the advantages of lightning fast development and application personalization with “clicks, no code.” These benefits have attracted many partners of which more than 2,000 offer apps on the Salesforce1 platform. Some of these are comprehensive ERP systems, such as those offered by Kenandy, Rootstock, Financial Force, Sage Live and Service Max.
  • Cloud Computing has gone from Probable to Inevitable
    • Amazon’s conference in October 2015 demonstrated that cloud computing has gone from probable to inevitable. Amazon WS, a startup 2006, now has 1 million customers located in 190 countries, having a $7B annual run-rate business, growing 81% last year, which makes them the fastest growing enterprise technology company in the world. Last year also showed that Amazon is a gifted software developer. For example, their new BI QuickSight is powerful and cheap; promised to cost only 1/10 of traditional alternatives such as those 255 BI apps that are available on their marketplace.
  • HTML5 and In-memory Computing are the New Standards
    • Microsoft Dynamics AX 7 announcement in November further emphasize the trends mentioned above. In addition they are talking about the benefits of DevOps to support “a living ERP system,” in-memory BI embedded directly in the application using the same user interface. Another key takeaway is a new touch-enabled HTML5-based user interface, supporting all type of devices with no need for Client software anymore.

The technology landscape has changed drastically in just a few years. Flash, Microsoft GUI and Java on the client are quickly disappearing. A prominent University recently reported that they replace Java with Scala as its preferred programming language. Workday, the most successful ERP newcomer during this century is following the same route. Workday, providing HR and Finance apps in the Cloud as a service, also help unveil two other trends: ERP is no longer “one size fits all” or a single product suite. As Charles Phillips, CEO of Infor, said at their 2015 conference, “Having the whole stack doesn’t matter anymore.”

As ERP is bumpier than ever, it has been interesting to follow how the world’s two largest ERP vendors Oracle (ca 12% market share) and SAP (ca 24% market share) diverged in strategy five years ago. Oracle bought the hardware manufacturer SUN while SAP announced availability of a brand new in-memory database, HANA. In what follows, we will take a closer look at the aftermath of these fateful decisions.

Oracle Refocuses on Software and Cloud

Oracle’s Fusion application project started shortly after Oracle’s USD 18 billion-acquisition spree of PeopleSoft, JD Edwards, and Siebel Systems in 2005. As the undertaking of rewriting its ERP system in Java was beginning to be completed, Oracle, in 2010, decided to buy the limping hardware supplier SUN. The mantra became “Hardware and Software, Engineered to Work Together”. Pushing Fusion applications was not prioritized. Three years after the launch of Fusion, the analyst Forrester called the number of Fusion customers, a “drop in the ocean” compared to Oracle´s overall applications installed base.

When other ERP vendors concentrated on preparing for digitalization and cloud, Oracle tried to sell a “12-cylinder gas-guzzler” to put in your office. It did not work out very well. Now, the question is rather: Who wants to buy Oracle’s hardware division? The famous book title: ‘What’s the difference between God and Larry Ellison? God doesn’t think he is Larry Ellison’ needs to be completed…

Oracle should also realize that the traditional RDBMS market is shrinking. Amazon’s attractive migration offerings to open source databases is one reason prices will go down. Another reason is that SAP’s new application offering does not support Oracle’s database (which is now what 80% of SAP’s customers have). If applications is not Oracle’s key to the future, what is? It is, therefore, good news for Oracle’s shareholders that its recent messages resonates well with the needs of the marketplace.

SAP Aims to Run Simple

SAP is well known for having the most complicated ERP system ever made. 45,000 tables, 400 million lines of code, and more than 400,000 screens. The numbers are astonishing. SAP ERP Suite is the incarnation of ERP complexity. SAP’s leadership finally realized more does not equal better and that a need for action was necessary before the business was stifled due to its own weight.

  • February 3, 2015, SAP announced a new generation of ERP named S/4 HANA. It is an entirely new product built on the most up-to-date design principles. SAP’s CEO Bill McDermott described it is a game-changer, the most important announcement for SAP during the last 23 years (i.e., since the launch of R/3). Some of the keywords is easier to learn and use, speed and simplification wherever possible. The key enablers are the in-memory database HANA and new user interface, Fiori.

SAP is at the top of its game with 67,000 employees and an envious P&L statement. Yet, it is ready to take a remarkable gamble. The hardest thing to do as a market leader is introducing a product and concept that directly challenges the paradigm that led to your success. In particular, SAP faces three challenges:

  1. There is no guarantee the idea of simplified ERP will appeal to existing customers or new prospects that are used to managing complex and inflexible application suites, where these characteristics are part of justifying the CIOs compensation.
  2. Even if the concept of radical ERP simplification succeeds, there is no assurance that buyers will choose to buy (or rent) next generation ERP applications from SAP.
  3. Massive ERP rewrite projects has left traces that horrifies. MAN X, DOCA, MOOSE, DEM, SF, and Project Green are a few examples. Why is SAP taking the risk? SAP’s co-founder and chairman Hasso Plattner answer is: “If we did not rewrite their 400 million lines of code, we will die… sooner or later.”

More of the Same

My prediction for 2016 is that we will see more ERP vendors joining the movement for simplification as a way to radically improve agility and decrease cost. Not always because they want to, but because they have no choice if they want to stay relevant.

  • For a software system to help its customers take advantage of radical change, it must be radically changed itself.

A significant challenge of ERP renewal is that a simple program rewrite or conversion will not do the trick. You could mechanically transform the code into a new arrangement or language – but then it would still be structured the same and perform the same functions in the same way as before. The result of screen scraping gives the same results. Radical rethinking of ERP does more often than not require redesigning it from scratch, using modern technology and sound application engineering principles.

How much the ERP landscape will have changed in three years will be interesting to see? Nevertheless, one thing is for sure; the changes coming will benefit the users of ERP!

19 May, 2015
by PeterBj
1 Comment

Known and Unknowns in the Quest for Predictable ERP Projects

“There are known knowns. There are things we know that we know. There are known unknowns. That is to say, there are things that we now know we don’t know. But there are also unknown unknowns. There are things we do not know we don’t know.” When Donald Rumsfeld, US Secretary of State for Defense in 2002, said this, he was almost universally lampooned as many people initially thought the statement was nonsense.

However, careful examination of the statement reveals that it does make sense. Moreover, the concept of Known/Unknowns existed long before Mr. Rumsfeld gave it a new audience. It has since long been used as a model for risk assessment, and as the illustration below shows, it fits perfect to classify four types of ERP projects.

Meeting the customer requirements well within the timeframe and budget is always the goal of professional implementers. In this endeavors, projects can take four archetype categories. In two dimensions, they tell us about the amount of clarity that the customer has of what s/he wants. 

On the Y-axis, we have capability requirements, what the application should be able to accomplish. On the X-axis we have ease of use issues, with which ease the application can be understood and used. Requirement Specifications is not enough because for each capability requirement are a variety of possible solutions, each solution involves making design decisions that affect usability.

This four-category classification helps us prepare for any new project and everything that goes with it (commitment, staffing, project management, change order procedures, and more). You may prefer an agile methodology; working iteratively and incrementally. That is fine. In most customer cases, however, you will never get the green light to start a project without a budget and schedule – which forces you to examine the scope of the project. To say something clever about time and money you need to know what the project is supposed to deliver.

Two Archetypes of ERP Application Projects
At each end of the spectrum, there are two different types of ERP application projects. One is vanilla (in information technology, vanilla is an adjective meaning plain or basic), the other is a pioneering project.

  • The perfect example of a vanilla project is to adopt a cloud application as-is; go live without any modifications, additions, integration and installation activities.
  • A pioneering project means developing an application that hitherto does not exists. That does not mean everything needs to be developed from scratch. You will for sure reuse many existing components. Nevertheless, to do something new means, as a starting point, that there are many unknowns that needs to be made knowns.

Why would an ordinary company involve in a pioneering application project? Of course, they should try to avoid it. If you can find an off-the-shelf application adequate for the job, that is the best solution. Notice the emphasis on the word ‘adequate’. Adopting an inadequate application can cost more and take longer time than developing a new one (using modern tools). Doing nothing may not be an option as we are in the midst of a transformation where everything goes digital on mobile devices.

I have seen firsthand how frustrating and painful application development can be. However, I have also experienced how development happens fast and simple toward delivering powerful applications driving significant business value.

The secret to successfully implementing new ERP applications (regardless of if it concerns a commodity, new application development or something in between) is to eliminate all unknowns. Simply, do not let them in before the project is completed. How realistic is that?

In the real world, you must allow exceptions to prove the rule, but that is what it is: exceptions. Most important to eliminate the unknowns is to specify the deliverables thoroughly and then have the users endorsing the new solution. The quality of this work depends on the ability to imagine the new solution – which in turn very much depends on the quality of the interactions and skills of the people involved and their ability to describe the new solution.

When the project have got the green light and is on the run, you still have to live with some unknowns – while you concentrate on delivering what we already know. You can do that, because you know that perfect is an illusion – so what you did not do perfect last time, you do better next time. That is how better can make you close to perfect. 

I know that this approach works, because I have used it many, many times. If you know where you are going, you eliminate the risk of ending up somewhere else.

21 January, 2015
by PeterBj
Comments Off on How Power Questions Provides Powerful Answers

How Power Questions Provides Powerful Answers

Where would we be if no questions were asked? Without questions, there is no search for answers, no thinking. Knowledge would remain static. We would be prisoners of the past. Asking questions is therefore seriously important. But asking the right question is a challenging task. Einstein was of the opinion that identifying the right question would enable him to pinpoint the exact information he needed to answer his problem. From there getting to the answer would be a relatively easy step.

People who develop new knowledge are driven by curiosity and aspiration. They know that flawed assumptions are the largest factor in flawed execution. They challenge the dogma and seek answers. Therefore, they ask questions. Questions are the foundation that builds reason for change. Progress starts with questioning status quo. The more vibrant your field of engagement is, the more important to ask questions to make learning happens faster.

Improve the quality of your questions is the most immediate thing you can do to develop and deepen your knowledge. Asking a question clearly is a big part of the way getting it answered. Answers can only be as meaningful as the questions are. Questions hold the power to cause us to think and create answers we believe in. The usefulness of the knowledge we acquire and the effectiveness of the actions we take depends on the quality of the questions we ask. Questions that leads to creating powerful answers deserve being called Power questions.

Power questions challenge our thinking. They throw cold water on our most dearly held assumptions and force us out of our traditional thinking. They help us think about tomorrow instead of defending yesterday. They motivate us to learn and discover more. They give us better insights. They help us go from the current view of the situation to a better view of the situation. Questions are the keys to opening locked doors. You create your opportunities by asking for them through power questions.

Soon four years ago IBM’s supercomputer Watson challenged human Jeopardy champion and won the American Jeopardy. This proves that computers can answer questions better than people can, provided the facts are made accessible for them. For sure was this a lasting mark on the history of Jeopardy and for the laboratories of IBM, who succeeded to richly encode human knowledge.

There are good reasons to be fascinated by ever more powerful computers and the new world they are opening up, which by no doubt will continue to alter our worldview, way of thinking and behavior. We must nevertheless not lose our foothold.

In spite of all great strides are we still far from having computers that can ask meaningful questions. For doing that, the computer would need to understand the inner-lives of the situation. To do that, it would need not only to think in the sense of queries given to it, but also experientially in the sense of having awareness. Such a modus operandi is forever closed off to a computer. It goes beyond the definition of what a computer is.

There will never be a Brave New World, Nineteen Eighty-Four or Hal 9000 where computers do it all. Much has been written about artificial intelligence, expert systems, neural networks, and the likes. But none of these is anything more than the application of human-defined rules, processes and an extension of information management mechanisms. Whether the information becomes questions leading to decisions marked by wisdom is out of control of the computer and what is built upon it.

To compete in the questionrace you will have to realize that computers can be of great help. Digital tools magnify the abilities that make us unique in the world: the ability to think, the ability to articulate our thoughts and the ability to work together to act on those thoughts. But lay off the paralyzing thought that computers can help you ask questions. Questions start and ends with the human individual. Curiosity and aspiration for better productivity and freedom will continue stimulate learning and thrive. You create your opportunities by asking for them. It is the reason to keep query: What, How, When, Who, Where, and Why?

As we enter an era of intense digital transformation where the cause and effect relationships are not always immediately apparent, it is imperative to confront brutal facts and ask questions to opening up new perspectives. Power questions provoke thoughtful exploration and inspires lateral thinking. We cannot solve problems on the same level of thinking that created them.

How can we get better at asking power questions? Here are some food for thought:

1. Start with asking yourself a tough question, “Why do I strongly believe what I believe?” Examine your assumptions mean extending your comfort zone and prepare for new opportunities. It takes courage. But, you are never brave before you have done it; bravery emerges from the good feeling of achievement. As with developing any skill, the best teacher is experience and the best coach is a thoughtful listener.   

2. It is not about just asking questions but asking the right questions. To that end, you need to establishing facts about the subject and then attribute meaning to these facts through value judgments. If you cannot frame and explain the question well, it can be because you do not understand the subject well enough. Then, you have to work on that. Believing you can ask power questions about something you do not know anything about is a delusion.

3. The management guru Peter Drucker is famous for his five opening questions when meeting with a new business. These are good questions, but they are not self-explaining. Why would he else write 39 books where elaborating on these questions is the essential theme? Drucker knew that when a good question also is properly explained it is much easier to start other minds along a stimulating line of thought.

4. Power questions typically transcend many boundaries and therefore often requires research and assessment. It is important that your best findings are framed as questions rather than big hairy problems. Questions are not supposed to end with an exclamation point but with a question mark. You therefore need to think carefully about the real question underneath everything you have discovered.

5. What will happen in 25 years’ time? – is no power question. It is outside the scope of most people’s interest and capacity to take effective action. Knowledge emerges in response to compelling, relevant and adequate questions. Questions should clarify the scope and keep them in realistic boundaries and needs of the situation at hand. To do it right you need to keep the main thing, the main thing, simplify as much as possible and sacrifice the “perfect” for the “good enough”.

23 September, 2014
by PeterBj
1 Comment

Business Process Platforms also Needs to Renew

A Google search for “Business Process Platform” returns 56.6 million results, including thousands of companies offering software solutions in this area, defined as product suites supporting the design and runtime environments for business process automation and enhanced user experiences. These companies range from global giants to miniatures offering only pieces of the BPP solution, whereas there are thousands of system integrators, workflow and enterprise consultants with their own opinions and offerings.

Given this multitude of solution providers, how can a prospective buyer make an intelligent decision on whom to trust with this mission-critical choice of platform software? If you have an ERP system, why would you need a BPP? How do you define your requirements? How do you sort out the companies offering real business value from those who just go with the motions? And, not least, what will you do with the business process platform that is already installed?

You may wonder why I am interested in BPP? It is no stranger than that I have been working with it for a long time and have customers using an old BPP Product. They often ask what I think about its future since the vendor does not say anything. I think vendors of BPP should be fair with customers and provide answers of where their products are heading. Customers want to know how their maintenance fees are used.

This allows users to make an informed decision about keep investing in their existing BPP or not. In the long run, openness is always the best alternative for everybody, also the vendor of entrenched BPP products. Nobody can escape, we are now  in the beginning of a major shift in enterprise software.

All enterprise software providers are facing major challenges as they have substantial technical debts. A technical debt is a term describing the development work that arises when a software product has not applied the best solutions measured by today’s standards. The need to remake an entrenched BPP is not only a result of poorly written code and replacing outdated technology, but also to assimilate an evolving understanding of the problems and the best way to solve those problems.

It is a fact that too many companies are held back by costly enterprise software that does not provide business freedom and beautiful user experiences. These applications, built on old platforms and technologies must either be renewed or replaced. For providers of BPP the key to the future is to offer hassle-free upgrades where greater flexibility, mobility and usability automatically enriches the facilitated applications. Upgradeability toward providing modern application capabilities is the force that is bringing other forces in the business process platform industry down to earth.

9 October, 2013
by PeterBj
Comments Off on Pointers for Achieving Faster and Greater Enterprise ROI

Pointers for Achieving Faster and Greater Enterprise ROI

Return on Investment or ROI is the order of the day for most executives but it is also a feared term in many companies. The expectation to deliver measurable business outcomes can be felt so challenging that it makes people talk about everything except the economic value of their improvement proposal.Whether you like it or not; ROI measurement is going to continue being a key factor when deciding yes or no to a business process improvement initiative. Lower cost, higher revenue, reduced risk, less tied-up capital, greater availability, more flexibility, better margins, happier employees and more satisfied customers are fundamental ROI issues and measures.

These desired outcomes are not new; they have been core concerns since money first changed hands. Although these outcomes have stayed the same nearly everything else has changed, and then changed again. A technology that was revolutionary yesterday is now outdated. Companies must now achieve these ROI outcomes within a fierce and unforgiving economic environment unlike anything anyone has ever seen.

In this post, I will share a few ideas in the form of some targeted advice for achieving faster and greater ROI:

  • Investments should be directed toward the best opportunity available. Avoid nostalgia. Investment decisions of the past must not be a roadblock for the investment decision of the present. Future expectations play a role – but the prospect that there may arrive a better solution in the future is uninteresting. Sure, there will be better solutions in the future.
  • Achieving ROI require understanding that money has a time value. Profits to be generated in the future are less valuable than profits delivered today. Doing it right requires a point-of-decision perspective where resources are allocated to generate the best possible return as early as possible.
  • ROI happens through purposeful change, which depends on people who are motivated, collaborative and communicative. No one can be a good change agent or teammate if left outside, uninformed. Therefore, the organization that cannot communicate cannot change, and the company that cannot change is endangered.
  • Every ROI issue and measure must be itemized. Every one of them must be translated into money, then summarized and compared with the sum of the capital outlays to realize those ROI items.

Calculating the ROI of your Enterprise Investment

A complete ROI calculation must include the impact of cash flows that extend over the time. When an appropriate time increment (such as month) is chosen the ROI dividend for each increment is calculated as follows: ROI% = (business value – investment) / investment.

If the business value is K€100 and the investment is K€80 it generates a return of K€20 i.e., 25% ROI. Assuming this was for January and you continue accumulating the same value, but with only half the cost, for the rest of the year; your annual ROI would be 130%.

Successful software and transformation investments do not only providing ROI but also a great recurring pattern. The sooner you invest in a profitable solution the longer time you will enjoy the benefit of recurring returns on the investment. The payback from your initial investment is only part of the equation.

9 September, 2013
by PeterBj
2 Comments

Exploring the Pathways to Better ERP Value

A key lesson from having worked with ERP for more than 30 years is that you should not modify the system without first trying to change your business to match the solution. Satisfactory and successfully using the ERP system as-is, is the best solution. However, as that is not always possible; it is not the only solution. Neither is it a final destination. The business environment is constantly changing. To stay current with your time, your business processes and its enabling software need to change too:

  • A primary rule of good business management practice is to continuously improve your way of working. When you are finished changing, you are finished.

ERP is at the beginning of a new era where social technologies, big data analysis, cloud, openness, mobility, specialized portals and awesome user experiences are key drivers. In the long run these drivers are going to deliver even better if you do not forget the lessons of the past:

  • A primary rule of good ERP management practice is to avoid modifying the program code of the ERP system. Fewer modifications means less problems.

What makes modern ERP systems attractive is the offering of open computing and continual upgrades where every new release provides new business capabilities. Leading ERP vendors are investing huge amount of money to make its next release delivering business advantage for its customers.

It is nevertheless true that even the most suitable ERP system may not support all business needs. Regardless of how much you try to tweak a business processes to match the ERP system there may be no practical solution. If such a gap is crippling your business too much it is time to act.

When standard ERP does not offer a solution and the business advantage of having a better process or function brings more value than cost you need to consider one of these complementary ways for better ERP value:

  1. Apply a pre-integrated add-on application and use it for leveraging the value both of the investment and the ERP system.
  2. Design and assembly a mashup/composite application on top of ERP. These kind of apps allows reusing adequate ERP functionality while adding all new capabilities outside the ERP system.
  3. Making a code modification is the least attractive way to go. However, as we are living in the real world we must accept that it cannot always be avoided.

Although “chuck it all and start all over again” is too drastic, good ERP management do recognize that an ERP system can become outworn. Systems that have served the business well and repaid itself many times over will at some point reach its limit. This condition typically shows in that it becomes too hard to make progress. When that happens, it is a signal that it is time to move on and replace the old ERP system.

ERP also stands for ”Everything Requires People”. Even the best ERP system will not excel if the implementation and ongoing service is poor. Successful customer outcomes depends on people who a) know how to turn knowledge into value and b) are at war with unsolved business issues.

Exploring the pathways for better ERP value is all about moving forward for the right reasons in the right way at the right time. This is vital as you do not want to point a direction, ask the enterprise to follow and then find out you took the wrong way. Part of the agenda to follow on this blogg is therefore:

  1. Pointers for acheiving faster and greater enterprise ROI
  2. Why ERP-systems at times need to be replaced
  3. How ERP upgrades automates business improvement
  4. The business advantage of complementary applications
  5. Understanding the business value of mashup/composite apps
  6. Considerations when forced into making ERP modifications
  7. Why the right people make the right things happen sooner

 

17 April, 2013
by PeterBj
1 Comment

Finding the Route to Competitive Advantage

What is competitiveness greatest enemy? Probably it is an organization that chooses to administrate what is instead of leading toward how it ought to be. The result of such behavior is predictable. You cannot improve your competitiveness by just doing the same things again and again.

Over 40 percent of the companies that were at the top of the Fortune 500 in year 2000 were no longer there in 2010. As well this statistics shows that the top businesses in the world are falling behind at an increasing rate! Why? Could there be any other reason than that they failed to be entrepreneurial and sharp their competitive edge?

The classic quote “everything that can be invented has been invented” is wrong, has always been wrong and will continue to be wrong. The world has never been as it always has been. In fact, you change, technology changes, the competition changes, opportunity changes, and the world changes. Everything changes.

Regarding changes and enterprise software; opportunity has increased in the last few years as wave after wave of disruptive technologies have swept across the IT landscape. Just try to imagine any business process that is not affected by social, mobile and cloud technologies as well as big data analytics and in-memory data processing.

The challenge of becoming more competitive is not about lack of opportunity, but making the right choices about where your industry and business is going. The goal of strategy is to achieve a sustainable competitive advantage over rivals. Basically this can happen through a cost advantage or a differentiation advantage.

  • A competitive cost advantage exists when a company is able to deliver the same benefits as competitors but at a lower cost.
  • A competitive differentiation advantage exists when a company is able to deliver benefits that exceed those of competing products.

Competitive advantage is a force that enables your company to deliver superior value for its customers and superior results for yourself.

The secret of getting ahead is getting started. And in doing that, why not agree already from the outset that developing competitive advantage is not a straight road with no bumps but a process in which different options are set against one another to achieve a better result.

When engaged leaders and colleges are discussing the company’s competitiveness and how to improve it, it happens that different opinions are expressed. This is not a bad thing. Because, if everyone is thinking alike, then no one is thinking. By bringing different perspectives into the conversation the frame of reference is broadened and the arguments are tried. A genuine business decision should be based on that different opinions are expressed – at least if it is going to have a chance to be the right choice and be effective.

The answer to the question of which way a company should choose is always a choice between alternatives that are based on different assumptions about the company and the outside world. The answer may pose a risk as it can lead to changes in company business model and behavior. A decision of this nature is too important to be taken with immediate acclamation. It should not be based on divergent opinions being suppressed, but be a fully analyzed and conscious choice between alternatives.

That disagreements become clear is healthy also in the long term. It is a major step towards an efficient management of the company. It enables the organization to collaborate better. Becoming aware of the differences of opinion makes it easier to understand each other’s reasoning, motives and actions. Hidden or only halfway clarified differences in terms of vision, goals, values, methods and processes underlie many of the problems that annoy and threaten to disrupt operations in different ways.

Another strong reason for bringing differences of opinion in daylight lies in that the question of what the company is and how it is portrayed can never have one and only one correct answer for all time. Technology development and the changing needs of customers, partners, employees and competitors constantly offer new business opportunities and challenges.

To continuously and correctly answering the question; how can we become more competitive? is the key to a rich and rewarding future. It is important, because your competitors can hardly be expected to just idle.

Anyone who stops being better stops being good. It is as plain, challenging and scary as if your competitors are thriving and getting better and you are not getting better, you are getting worse!