Achieving business agility between ERP and Cloud

An intense debate between two CEOs ensued while I was listening with concentration to them; there was no debate on the need for every business to leverage technology to stay ahead of industry growth curve. Both had experienced success, but there was indeed a bone of contention. One of the leaders vehemently recounted the inability of ERP solutions and vendors to address the market dynamics. He cited many instances where the ERP vendor as well as his IT organization took longer time than business could afford; small solace that his competitors also used the same solutions and thus had similar issues.

The other CEO countered with an equal number of scenarios when the specific ERP had indeed been ahead of others. Now every ERP solution provides a complex array of parameters and settings that can be manipulated to provide functionality for most business processes. This complexity also becomes a bottleneck when any change is required. It is rarely as agile as other smaller solutions that can quickly be customized. CIOs have had difficult discussions on this aspect with Business and Vendor alike. The monolithic nature of the solutions indeed poses a challenge. Not that there are too many options, so the technology ecosystem has created multiple layers to manage the agility requirements.

Grudging acknowledgements later, both glared at me as if to validate their arguments and then turned back to each other. Before they could continue, I pitched in with thoughts on the new opportunity that has everyone confused and wondering with benefit statements ranging from better ROI to TCO, time to market, productivity, and the panacea to all ills that face every enterprise that uses technology.

This brought a smile to the face of the second CEO who began to lecture on the future being cloudy and why current IT models will no longer survive. He elucidated the benefits of the new disruptive paradigm the Cloud is and why enterprises should be embracing this. Now the other looked imploringly at me to help him and I could not refuse the request. After all I had broached the subject so I had to provide a perspective.

Differing flavours of clouds offer different value propositions; the viewpoint put across by the CEO related to Application and Software as a Service. Both offer an easy way to deploy and get started on any new business area or process. The most widely accepted scenarios are sales force automation and collaboration; for SME the benefit is limited upfront investments and no worries about managing complex technology. Beyond these mainstream business process remain firmly grounded in corporate data centres.

Irrespective of their physical location, the big ERP remains the same animal, big monolithic and complex. Separating processes like sales force or collaboration (read email, chat, etc.) does not in any way create an opportunity for agile business process alignment for the rest of the enterprise. In fact with the cloud, the base expectation is that business processes are standard and can thus be uniform across multiple companies. Clouds provide faster start points, but the change ability remains similarly constrained. A question from the audience inquired about ROI models for evaluating Clouds; that is another story for another day.

The two CEOs representing a large business house and a leading global ERP vendor acknowledged the reality and it was time to move on. The CEOs and CIOs listening to the interaction went away with both sides of the coin clear (?) to create their own agenda and discussion in their enterprises.

Preaching to the CIO

The other day I attended a congregation of CIOs with a dozen odd vendors sponsoring the event. It was a gathering of 100 odd CIOs who took time off on a Saturday to amongst other things patiently listen to the spiel. With representation across industries and a mix of senior and evolving leaders, the learning and networking potential was expected to be high. The investment of time from these leaders carving out a portion from their personal time was expected to yield reasonable value.

Now every sponsor vendor always seeks to disseminate information on their offerings and pitch their wares to every target segment. Traditionally this has taken the form of slide presentations that no one wants to hear; at times even the presenter is struggling to do justice to the content as s/he is not the creator of the slides which have in many cases lost relevance. Futile attempts to change this model of engagement have left the participants numb as they grace such time with their physical presence but rarely with the mind.

Before embarking on the merits of doing business with their company, setting the context with the audience has always been seen as a good idea; and this is what they started off with. The first one off the ground started with data from respected research companies.

What is the business reality today ? Not necessarily in order of priority, they are: expectations of growth, exploring new markets or products, driving operational efficiency, cost containment, IT lead innovation, and customer centricity. How do these impact the CIO ? The CIO is expected to be a business leader shedding off the technologist skin; s/he should transform and work with other CXOs, overturn the iceberg of IT expense by reducing the operational expenses and allocating higher amounts to new initiatives. Slides titled “Changing Role of the CIO” advised the need to wake up and get going. However, the best part was how their old offerings now enable this shift.

Storage solutions, Security service providers, system integrators offering RIMS, data centre solutions, virtualization solutions, and even network solution providers found a way to connect the dots and make the CIOs appear like cretins and kids in school who needed to be reminded of how their performance will be measured. Best part was the repetition of content with the context lifted from the same reports.

We all know that CIOs are a patient lot and do not ruffle feathers easily. But when speaker after speaker repeated the cliché, the unrest in the room began to take the shape of a mutiny. Half way through the program, sparsely occupied seats greeted the incoming speakers; those present had no interest and thus engaged each other on the table in discussions detached from the proceedings in voices loud enough to send a clear message across. Over coffee the vendors were chastised for their immature behaviour with a clear message:

We know our reality better than you ever would; we transitioned to being business leaders a long time back; however you are still trying to sell to IT Managers believing that the past is frozen. We did impact the expense line and it was not about IT expenses only which is why you believe that we are not connected to the reality. Our CEOs and other CXOs do not look at us the same way they did a decade back; they partner with us, seek our advice and work together towards the common business objectives. We are not enamoured by hardware, software, new technology, we seek to solve real life business problems, sometimes with help from technology. So, stop debating the changing role, it happened while you were busy trying to figure out why there is no traction any longer with the CIO. It is you who need to change to align to the new age CIO.