Enabling Business with an intelligent Business Intelligence strategy !

The company had faced challenges due to change in leadership positions often due to bad hires across positions; decisions were made based on bravado and far-fetched stories that even the naïve would find hard to believe. The pseudo leaders in turn hired a coterie that would make them look good in meetings and talk about the glorious past that remained unverified. The rot at the top soon started bringing results commensurate to the collective intelligence applied to the problems and opportunities at hand.

In a growing market loss of market share and dive in profitability for a steady business could not remain unexplained for too long; the growth agenda and strategy that was outlined with help of big management consultants was quickly challenged by equity analysts while the shareholders listened to the stories with unease. Nepotism running rife through the ranks led to collapse of meritocracy – some becoming victims of their high professionalism and others weeded out as they individually threatened the collective brainpower.

The stock price which had tasted peaks with the induction of the new team started a slow and steady slide shaking up the promoters and the Board, to sit up, take notice and do something about it. Failure of cronyism resulted in tumbling one after another like ninepins but not before they had shaken the foundations of a company that had withstood market uncertainty and thrived in the long history of the industry. Few of the inept skillfully hid themselves from scrutiny and survived the expungement of undesirables.

One such survivor was the CIO who successfully portrayed herself as a critical resource and managed to save her band of followers too. She misrepresented past ties distancing herself from those out of favor; those under her patronage followed the leader saving their skin as the rest of the team watched in amazement. They rode on hard work of few good people, quick to claim credit while ensuring that no voice was raised or heard against their tribe as they strengthened their feeble position step by step.

Taking control of the situation the Patriarch emerged out of retirement and hired fresh management team to take over the shambles, revive and restore the rightful place in the market. Staying out of sight during the initial reviews and analysis, she slowly emerged from the shadows to stay out of the limelight lest her highest level of competency fall short of the rising baseline. The enterprise trundled along recovering some lost territory but struggling in the absence of accurate and timely information from the transactional and reporting systems.

Under the spotlight she promised to create business intelligence strategy to help the company in taking better and effective decisions. The task being beyond her intellectual capacity, she felt prudent to hire a big name consulting company to formulate a plan that would save her skin and earn some brownie points. Budget for the exercise was sanctioned and the consultant brought on board; as they got started an unaligned team mate who was the mainstay of existing business and financial reporting quit.

A specialist was brought in by the consulting company who understood the industry as well as the technology adoption curve for similar enterprises. Within no time he had captured the current state of transactional, financial, sales, and other functional reporting, which was quite basic. He evaluated the tools and technologies, inventory of licenses available, and called a meeting with the CIO and her team to discuss the future roadmap, vision and direction, and get an insider view of the challenges and opportunities.

She started off well, but…: I want to outsource the entire analytics and operations while my team can focus on what matters to the business. My team lead has quit recently and due to that there is a void that needs to be filled. You know we implemented this new ERP system last year and then we also invested in this big name BI tool, the implementation of which is still going on, and my BI lead has quit. I want a strategy for which report should be served from the ERP system and which one should come from the BI system.

The consultant did not know whether to repeat the question or accept the answer at face value; as he mulled over the response, the silence was broken by the CIO again: Why are you confused ? We developed over 200 reports in the ERP system, but hardly any are in use; most users want a data dump and then use it in spreadsheets. The management is upset as the inability of the investments to deliver; which is why I need your help to understand which reports we should retain and which we can move to the new system !

The next day the consulting company withdrew from the engagement !

The fine balance between managing growth and profitability and differences between enterprise and startups

Established enterprises are mostly like sloths who move at their own pace when reacting to any kind of market or environmental changes (there are exceptions to every rule and there are some to this one too). Many get there eventually due to the resilience in the business and the sheer size that keeps the momentum going in their favor. Some suffer short-term impact and brush it aside as a learning; in rare cases if the company loses direction or has a significant impact, they become prey to the opportunist predator or break into pieces.

We grew 15% last year, the market grew 12%, so we are doing good; this year the forecast for the industry is 13%, let’s target 16% growth. Our profitability is good and in line with industry numbers, we benchmark favorably. Enterprises are predominantly organized in silos, each chasing respective targets on profitability and growth which are derived from past performance. Rarely a division or Business Unit thinks of breakthrough performance; the entrepreneurial spirit is rarely seen amongst enterprise managers.

Checks and Balances matter a lot to the Board, Management and Leadership of enterprises; they live and swear by ratios and manage balance sheets. Targets are set, budgets managed, numbers scrutinized, long weekly and monthly reviews held to make sure that everything is working as expected, no surprises. Staid growth married to acceptable profitability ensures that numbers match quarter on quarter. Aberrations if any require painful explanations and root cause analysis only to be repeated ever so often.

Despite the world having seen many black swan events in the last decade or so, enterprises continue to live in their world consciously immune to potential threats. So when disruption occurs from unknown sources not factored into annual operating plans and strategic business plans Management teams scurry into offsite meetings to evaluate, synthesize the information, and arrive at counterstrategies. Alternately a big name consultant is hired to review the impact of disruptive forces and advise the management on recourse.

On the other hand startups enjoy the advantage of no historical data and thus they dream audacious and hairy goals; they want to change the world with their version of solution, product or business model; create new markets, beat big incumbents, or at least launch a flange attack to gnaw at market share. Most of them are driven by young entrepreneurs wanting to emulate peer success; their prime focus remains growth, at times driven by easy money at their disposal or their extreme risk appetite and nothing to lose attitude.

Technology driven startups have low entry barriers that allows for me-too ventures with irrational euphoria. Flash in the pan success emboldens the space until it gets crowded with spectacular failures, at times taking an entire ecosystem or micro-segment of the industry with them. Despite large amounts of fold ups, they continue to mushroom with reduced cycles to merger or demise. Some of these have been in hyperlocal services, aggregation of services, hyperlocal logistics, home ordering, and many more.

The moot question is why are enterprises unable to launch such blitzkrieg and capture the mind and imagination of their customers ? Why are they so obsessed with numbers and ratios ? Exceptions aside, majority of startups are long way off from making money while they continue to invest in market expansion; exceptions aside, majority of enterprises have not been able to replicate the success of the technology driven pure play companies; they continue to be at different ends of the spectrum in their results.

Experiments with Design Thinking and Inside Out innovation models have not been able to live up to expectations in the enterprise. Lateral shifts, hiring fancy titled self-proclaimed experts like Chief Digital Officers and the like have boomeranged. Politics and power struggles have seen the demise of many good initiatives with CXOs squabbling about credit and pushing the blame. The exceptions have grown with focused attention and faith in their business models as well as the teams who shepherded the successes.

Reality is that conventional wisdom and progress over the years brings in a certain way of working to enterprises that defines them; they find it difficult to give up their winning formula and move on to a new paradigm. Reality is also that startups with no baggage find it easy to let go and learn from their failures; at times they are also naïve in their thinking and repeat mistakes. A crossover between the startup and the enterprise culture would probably be a recipe for success or disaster of major proportions.

Which one will it be ?