Date Tags business

When the strategy is not clearly defined or articulated to the information technology staff, they start making their own assumptions about the wants of the executive team, which sets the strategy. Or, IT starts reacting to the needs of the supply chain staff, who themselves are not clear on supply chain strategy or business strategy, but are very vocal in articulating the tactical problems which they face in their day to day running of the business. Though it is important to address these tactical issues in the systems renewal effort, they should be escalated to a strategic level to be addressed. The following example will give you a better idea how tactical thinking dominates the plans of information technology staff during system renewal efforts. A recent examination of a business that I worked on revealed that the selection of systems vendors was made entirely on cost constraints, rather than envisaged benefits. As a result, the new system put in place was inferior and did not support the demand forecasting process or the inventory optimization process of the company. It is pertinent to point out that this business operated in an industry that largely thrives or fails on the basis of its inventory management capability. However, the information technology personnel who made the systems selection decisions were either unaware or ignored the fact that in the mass retail business in which their company operated, one of the most important determinants of success was the inventory management capabilities. IT staff were very much aware that the business shareholders and the board were extremely cost conscious and they reacted to that economic constraint far more than to the strategic needs of business for a robust inventory planning system. The entire effort of two years of systems selection and implementation was wasted as a result of this key tactical blunder. Unfortunately, we were called in to the business far too late when it was already way behind its competitors and on the verge of bankruptcy due to misapplied inventory management capabilities. We could immediately diagnose the key strategic blunder that was made several years ago when the new system was put in place. Penny-pinching at the time of systems renewal had sunk the business beyond redemption.The teams often do not attempt to visualize how the day-to-day life will change once the new system is in place. Without such visualization, perhaps from inadequate or improper understanding of the coming change, companies are charting a course while surveying the territory. No wonder they get lost. What do we mean by visualization of how life will change? The fact is that every company is currently operating under a set of constraints and assumptions. When the new system is fully functional many of these constraints will disappear and many of the current assumptions will not be valid any more; a new way of functioning will need to evolve. With the availability of knowledge about the new systems, it should be easy to understand the complete capability set of what is going to be put in place. With this understanding, the company should be able to create a reasonable view of how the entire business will work when the new system is in place. This visualization allows the company to align the new processes with each other and with the strategy of the business. However, lack of this visualization results in critical mistakes being discovered at every point during the execution. In addition, the staff end up using no more than 40 per cent of the functionality that the company enthusiastically paid for. A listing in any business directory should boost your visibility both on and offline.