It Works Better When You Turn It On
Simple lesson, hard experience.
Life as a consultant provides a wonderful window into organisations and insight into opportunities often overshadowed by the daily grind in the workplace.
A recent experience led to reflection on how things work better when you turn them on. A simple reminder that investing in a 'solution' requires ongoing investment to achieve an effective outcome: a lesson equally applicable for man, machine, process or system yet easily overlooked when staff are busy being busy in a competitive age.
Business Tools At The Desktop One recent consulting task was to identify an Enterprise Resource Planning (ERP) system. The CEO wanted a business tool on managers’ desktops to transform information into knowledge, assist informed decision-making and contribute to an integrated culture. Whilst the base of the ERP systems is the financials, it is a management tool not just an accounting package.
Many systems are available boasting exciting functionality and user-friendly features:
- Systems providing real-time, accurate information overcoming the need to rely on historical variance analysis or to wonder when information would even be available for analysis.
- Systems that equip managers with access to accurate information on ratios, benchmarks, trends and 'what if' analysis etc. at their desktop.
Maximum Functionality – Minimal Usage Referee checks of vendors' referral sites were illuminating. Despite the major financial investment, referees were only using a small part of the capabilities of their new systems. It seems the purchase decision was based on replacing functionality in financial reporting rather than realising the opportunity to optimise resource allocation across the organisation.
Buying a new system to simply mirror an old system makes little sense. It discards the opportunity to realise the potential of business tools by providing little incentive for staff to develop their thinking and skills and contribute to organisational development.
Replacing functionality, specifically financial reporting, was essential. Their investment was in an ERP system not just a pure financial package. An ERP system justifies the size of the investment required when it makes a major contribution to Managers ability to manage and improve performance.
A return on the significant financial investment in an ERP system is achieved when heightened staff expectation is matched with confidence across the organisation in ability to realise the expectations.
Integrated Approach Silos sustain themselves by avoiding accountability for corporate performance, resisting integration and restricting access to information. A narrow departmental focus avoids the notion of the value chain. Integrating and enhancing operational, financial and reporting functions across the organisation develops the value chain.
Business tools require an integrated approach to be of significant benefit. Internal partnerships lead to focus on the links in the organisational value chain that can add more value.
An ERP is a perfect tool to develop the value chain and get the best out of finance staff. Developing internal partnerships between managers with little financial background and finance staff improves understanding, organisational decision-making and resource allocation.
Staff Commitment An organisation realises the full benefit of business tools when staff expect greater functionality and are motivated to achieve it. Paradoxically, when expectations are low, return on investment will remain low and in inverse proportion to growing need.
The changing role of finance from scorekeeper to internal consultant recognises that managing cost is the essential outcome of measuring cost. Other disciplines also face changing roles based on corporate performance indicators. Tools that help manage the change are most valuable when staff are committed to using full functionality.
Turning It On Maintaining staff motivation is always a challenge. Business tools provide a real opportunity for managers to motivate improved performance while providing opportunity for achievement and growth. The key is motivating staff expectation of the benefits and providing recognition for their efforts in achieving the benefits.
Equally, new tools can fuel cynicism. When the pressure of day-to-day demand takes precedence over investment in future needs, business tools may be perceived by staff as an encumbrance rather than a benefit. Warning bells should sound!
Staff 'buy in' maximises the value of business tools. It begins with staff understanding the potential and is developed by quality training that builds
their confidence in
their ability to achieve it.
Ongoing support and sufficient slack to learn from mistakes further motivates expectations. Tangible benefits including
greater ability to manage workload and increased understanding of how to improve results builds staff confidence creating an upward spiral maximising benefit for all concerned.
Whether man, machine, process or system, it works better when YOU turn it on!
John Cleary is Managing Director of Cost Management Specialists Pty Ltd, a member of the Blue Chip Consulting Group. John is results oriented and uses his expertise and significant experience to find the hidden profit for clients in a broad range of industries. He speaks regularly at National Conferences on a variety of topics and can be contacted on 03 9941 3133 or via costman1@costms.com.au
First published: 6 March 2002.
Last updated: 5 October 2005.