A Tricky One, But … Are You Competent?
About to invest in new computer systesms - such as Sales Force Automation(SFA), Customer Relationship Management(CRM), or just looking to improve your business reporting through installing new Business Intelligence(BI) software?
Be careful - the IT industry has often managed to sell new gizmos to business, but has not been as successful in making them work.
Over recent years, various statistics of new systems implementations have emerged that should cause any business owner to think long and hard before investing in the next ‘all-seeing-all-doing’ software package:
- 40% of Business Intelligence(BI) software ends up as shelfware - it’s bought, but not fully used for its intended purpose
- 70% of datamart / data warehouse implementations are considered failures - in that they either cost a lot more to deliver, they don’t deliver what was promised, or they take too long to extract the data.
- A large proportion of CRM implementations have been reported to yield disappointing results.
If you want to avoid this type of business waste, listen to John McKean, author of ‘The Information Masters’.
He believes that in many cases inappropriate systems - too complex and too expensive - have been installed. As a result, most of the project budget is consumed by the hardware and software, and too little money is allocated to ensuring that staff can effectively use the new systems.
John McKean introduces a term - ‘Information Competence’. He developed this concept after conducting studies involving both successful and unsuccessful
IT projects in a variety of US-based companies. McKean refers to companies having an information competency where they have a systemic information capability that underpins the entire organisation.
He states that information competency is not primarily based on technology and requires a balanced investment across seven key information dimensions:
- People skills
- Processes
- Organisation structure
- Culture
- Leadership
- Technology
- Information
Many companies spends too much of their project budgets on technology, and too little on the other key factors that will ensure competency success.:
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Historical vs. Ideal Competency Investments
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| Elements | Historical Investment | Recommended |
| People Processes Organisation Culture Leadership Information Technology |
2% 2% 1% 1% 1% 10% 82% |
20% 15% 10% 20% 10% 15% 10% |
| TOTAL | 100% | 100% |
There are a few important lessons here. As a business owner:
- You cannot commission a new system, and leave it all up to your technical staff. They will happily spend your money, but unfortunately on the wrong elements of the project.
- Your staff needs to be trained to be effective with your new systems. Unfortunately you need to take the lead here in terms of adopting and using the new procedures.
- New systems means that new policies, reward systems, and even new disciplinary procedures need to be defined.
If you follow McKean’s advice, your business will become more competent with using information - literally becoming one of the ‘Information Masters’.
