What is the point of your suite of IT Systems?
For some, the answer to this question is that IT is only useful for communicating with clients and storing documents. Others believe that IT systems merely an unfortunate cost of doing business. However, a third group understands the impact that business sensible IT investment can have. This third group sees information technology as the way to not only improve the efficiency of current processes, but to use it to transform their business. Regardless of your perspective, you must ensure that your expenditure on technology is done in the right way and is helping you achieve success. Consider your business and its many parts. You have sales, service and operations as well as administration and perhaps product development. Now, you make investments in each of these parts of the business to make processes effective and to achieve high quality outcomes. For example, upgrades and improvements to the equipment in production lines are made to ensure good quality products are manufactured. Other examples are the tools and training that staff are given to ensure their jobs are performed effectively and efficiently. Think of it this way. Each of the parts of your business are connected in some way. And, what is interesting, is that Porter’s Value Chain (a particular approach to the management of business) describes how each of these parts are linked. Take a look at the following diagram:
Consider how this diagram describes the relationship between each of the parts of your business. That is, those parts that are classified as primary activities, and those that are defined as supporting activities. Consider how the primary activities are chained together in order to transform your raw materials into the goods and/or services that you sell. And consider how the support activities influence all of the primary activities. So, what has this value chain got to do with your IT? Let’s frame it this way: IT stands for the Technology that support the creation, flow and use of Information in your organisation. Information is a component of every part of your business. Every component of your value chain.
"Information is the oxygen of the modern age"
The critical question is this: How effective and efficient are your suite of IT systems in supporting the creation, flow and use of information in your organisation? Consider Porter’s Value Chain and all of the parts of your business. Using this model as a frame of reference, you can see that there is a flow of information between each part of the business. Some parts may only create information, while others may use what has been created elsewhere in your business. However, in every part of the business, it is important to have the right information available at the right time, and to be able to be used effectively. The goal is to have information flowing freely and effectively throughout your business. To meet this goal, here are three activities that you can perform:
1. Take the time to analyse your workflow
By analysing what people do, the information they require to do their jobs, and the outcomes from their decisions, you gain an understanding of how work flows throughout the organisation. Based on this understanding you can make improvements to productivity. For example, you may decide to replace or upgrade software because of the workarounds or extra steps you discover staff are having to use.
2. It may be time to remove paper-based systems
Paper-based systems could well be a drag on your business performance. It takes time to write on paper. There are archive and storage issues to consider as well. Invariably, what is written down needs to be entered into a computer system anyway. There are benefits of shifting from paper to all electronic systems. One is the accuracy of data due to the reduction in transposition errors. Another is the use of staff time. Where data is directly fed into the computer system, and when associated reports can be produced in (near) real-time.
3. Determine if there is a consistent view of customers throughout the value chain
This can lead to the customer viewing you as unprofessional in your dealings with them. Where different teams within your business have completely different understandings on the relationship your customers have with you. If sales sees one set of facts about a customer (ie. their purchase history) and service sees another (ie. the repair history of the products they have bought) there is the possibility of mistakes being made. Sales could continue telling the customer of the good deals not knowing of how poorly those products have performed in the past. In this instance, reputation damage may well follow. In summary, you can see from this list that IT investment decisions start with an understanding of the business and understanding of how the various parts of the business interact. Technology should be used to support the lifeblood of your business, information. So, what is the point of your suite of IT Systems? It is to effectively and efficiently support the creation, flow and the use of information within and between each part of your business. In the words of Ronald Reagan: “Information is the oxygen of the modern age”.
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