What is in this article?:
- Separating Impact from Hype: How CFOs Achieve Technology ROI
- Process is key to better technology ROI
- The best technology-based transformation focuses on what matters
A total focus on technology almost invariably fails; companies that take into account the requirements of process and the "human factor" have a much higher degree of success.
Why do so many technology upgrades fall short of their goals? How can the vast capabilities of modern technology tools still fail to meet critical user needs or provide material return on investment—with the goal of cost-to-serve, agility and adaptability, standardization or scalability? Why do so many companies reach the end of a multi-year deployment only to discover they are not materially better off than before, and that the world has moved on to the next big thing?
The answer lies in how they approach IT. Too many companies view technology as the primary factor in greater efficiency. They fail to engage in a deep analysis of the processes IT must support or how people will leverage technology. Many implement a vast array of process and technology improvements rather than surgically target the actual drivers of desired business outcomes. Sometimes there is a disconnect between what the CIO perceives as necessary and what the CFO needs to accomplish. And, too often, a carefully planned deployment meant to address particular problems is implemented so slowly that by the end, business needs have radically changed and the solution is no longer adequate.
ERP is no longer the only answer
A huge, multi-year implementation is no longer the only option available to leverage better technology. In fact, massive implementations can sometimes undermine actual business goals. While there is still room for enterprise resource planning systems, ERP systems seldom address all business needs, and may not promote business goals of simplicity, efficiency and speed of deployment. ERP systems are also prone to expensive customizations, are non-intuitive to business users, and can result in highly fragmented backend IT systems and “data islands” that are costly to man and hard to evolve.
By contrast, consider the example of a global claims management provider that sought to improve its manual and disparate accounts receivable (AR) and collections processes. It chose to deploy a cloud-based, end-to-end software as a service (SaaS) suite of financial and accounting applications in its U.S. operation. A test within a chosen business unit produced improvement so significant that the company moved up the scheduled rollout of the solution to the rest of the U.S. operation by six months. Because the new system easily accesses legacy ERP data but is much more user-friendly, collectors who previously felt as though they were working on separate islands now feel part of one team.