Not too long ago, I was asked to take a look at what SAP was doing and see if I was interested in helping define how our company could leverage their "Next Generation" of ERP. To be honest, the thought of working on SAP was less than thrilling. But, I knew my boss, and I very much respected him so if he asked, then he must have seen something and the minimum I could do was look at it.
My hesitation stemmed from the perception of SAP as simply an ERP. SAP is a whole business built on defining the world's "best practices". The logic went like this... SAP's business is defining the "best ways" to handle functions which are not "core" to other businesses. Since these functions are core to SAP, they are able to spend massive amounts of R&D on these functions and with a customer footprint as large as SAP's, they are able to define best practice and productionize it into their product suite. The clients of SAP therefore benefit from best practices.
What I disliked about this is that, by definition, a best practice is a system/process which has already been done and repeated and proven to drive efficiency across several organizations. It runs counter to innovation. By implementing these best practices you will be as good as anyone else who also implemented these practices.
Now some would argue, that if it's not "core" to your business (aka "context"), then why would you care? Instead of wasting R&D on these, just focus on core competency of your organization and allow others define best practices for everything else. For example how many companies write their own Word Processors? This is true. But as the processes become larger and larger, they encroach on areas that are core to an organization and in the quest for efficiency, we turn a blind eye to opportunities for creating true differentiators. For example, if a company differentiates itself on it's "customer service" and it has implemented a best practice CRM suite, they have successfully become as good as everyone else who has implemented this suite.
By implementing the best of the best, they ignore opportunities to change their processes and truly differentiate the experience with the customer. Instead, they've become dependant on a third party to innovate on their behalf. Where is the line between context and core? And could there be elements in the context which can brought into the core?
So do you throw out everything and start from scratch? No. The key is to use it as a starting point only and allow for innovation from there. In some situations, if it's really core to your business then you may indeed have to start from scratch. Consider Google... Their "core" was in their proprietary advanced search engine algorithm. Google's business was not about servers or massive data warehouses. BUT rather than using "best practices" in data warehousing technology, and purchasing a massive data warehousing environment like IBM, Oracle or Teradata, they took many many many PC's, stripped them down, strung them together and created their own proprietary datawarehousing. NOT core to their business.... OR was it?
So back to SAP... It turns out that those clever folks at SAP have realized this as well. Their proprietary nature has given way to open standards which if their vision pans out, means we should be able to use their best practices as starting points. Through the SAP NetWeaver technology (SOA based ERP), companies will be able to to dis-assemble best practices and build unique and differentiated processes which can lead to a competitive advantage.
The big question though.... Will companies actually drive innovation now and take advantage of best practices as only a starting point? With all the hype SAP is putting behind NetWeaver, and the hype around SOA? I suspect for most big companies the answer is "no". Well at least not immediately. Why? Well, that's another blog for another time but it has something to do with our fascination on efficiency.
Saturday, February 17, 2007
Saturday, February 10, 2007
Enterprise 2.0, Extreme Simplicity & Culture: Lessons from the iPOD
So Apple has come out with their iPhone... Chalk full of new features & new functionality... Will it do to the cell phone what the iPod did to the MP3 Player? And what does this have to do with Enterprise 2.0 and culture?
When the iPod came out, it was by no means the first MP3 player. In fact MP3 Players had been out years prior. The unveiling undoubtedly underwhelmed many "analysts", (in my mind I can hear the sarcastic Monty Python line, "and there was much rejoicing... yay. "). The iPod focused on extreme simplicity. When Apple's designers were building the prototype and pointed out that it "obviously" needed an on/off button, Steve Jobs made an executive decisions forbidding any such thing. The wheel was introduced because, trying to push a button to scroll through a 1000 songs was simply not "friendly". It's true, the integration of iTunes also played a part of this amazing story for iPod but for this blog, I'll just focus on the "extreme simplicity" / "Extreme Usability" concept.
Apple's challenge with the iPhone however is that it has lot it's stealth. In other words, people will not dismiss Apple introducing something new regardless of what it is. This time everyone will take note. The iPhone is following the same principles of extreme usability. So regardless of the functionality as this will constantly change, the usability factor will always be the more critical. Those who mistake functionality vs usability will go down the wrong path since functionalities will always improve and advance.
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Enter, Enterprise 2.0... The world of wikis, blogs, mashups, etc... Although relatively new, the studies so far indicate that the value of Enterprise 2.0 is still very limited. Harvard Professor, Andrew McAfee identifies that Enterprise 2.0 appears to only find adoption in the techno-savvy or recent graduates (figure to left).
This leaves a large "empty quarter". In any organization, especially older organizations, this is a significant number of the employee base that may never participate in mass collaboration opportunities provided by web 2.0 in the enterprise. The knowledge and insight in this crowd however is paramount. Over and over again, the evidence such as Jim Collins work in "Good to Great" indicate, greatness requires deep insight only afforded through rich experience & organizational wisdom.
So if we need this empty quarter to participate, and we have the tools to allow for collaboration, how do we tap into their insight? The common answer suggests evangelizing to this group. Changing the culture so they become included. For those involved with culture change will realize that this is by no way a simple feat! Perhaps it's not about changing the culture so they adopt but rather simplifying the experience and focusing on the individual. This viral approach could then result in a corporate culture shift. Perhaps we can learn something from the iPOD.
Although I haven't done my own quantitative studies, I suspect that the MP3 Market, prior to the iPOD followed a similar pattern to that of Enterprise 2.0. Recent grads & techno-savvy were the adopters... Apple could have came up with a similar product and attempted to "evangelize" the features and functionalities. Perhaps try to change the "culture" to increase adoption. They didn't (well not at first). Instead they focused on extreme usability which dives deeper than the "cultural" aspects into the "individual". By stripping away the fluff, and focusing on extreme usability the individual needs & wants could be addressed. If you like music you'll like the iPod. We don't need to convince you it's worth the headaches of understanding the technology because there are no headaches.
Same thing for massive collaboration and Enterprise 2.0. Deeper than the corporate culture are the individual motivators. I am not going to dive into Maslow's hierarchy on this blog but it is related. The individual need to communicate, and be part of social group is a core attribute. Man by nature is a social creature. Enterprise 2.0, if made extremely usable can tap into this. The impact could mean that rather than changing the culture so they adopt Enterprise 2.0 technologies, that Enterprise 2.0 technologies could change the culture through the individual. Evangelism should consider this, and move away from justifying the complex and focus on extreme simplicity.
When the iPod came out, it was by no means the first MP3 player. In fact MP3 Players had been out years prior. The unveiling undoubtedly underwhelmed many "analysts", (in my mind I can hear the sarcastic Monty Python line, "and there was much rejoicing... yay. "). The iPod focused on extreme simplicity. When Apple's designers were building the prototype and pointed out that it "obviously" needed an on/off button, Steve Jobs made an executive decisions forbidding any such thing. The wheel was introduced because, trying to push a button to scroll through a 1000 songs was simply not "friendly". It's true, the integration of iTunes also played a part of this amazing story for iPod but for this blog, I'll just focus on the "extreme simplicity" / "Extreme Usability" concept.
Apple's challenge with the iPhone however is that it has lot it's stealth. In other words, people will not dismiss Apple introducing something new regardless of what it is. This time everyone will take note. The iPhone is following the same principles of extreme usability. So regardless of the functionality as this will constantly change, the usability factor will always be the more critical. Those who mistake functionality vs usability will go down the wrong path since functionalities will always improve and advance.
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Enter, Enterprise 2.0... The world of wikis, blogs, mashups, etc... Although relatively new, the studies so far indicate that the value of Enterprise 2.0 is still very limited. Harvard Professor, Andrew McAfee identifies that Enterprise 2.0 appears to only find adoption in the techno-savvy or recent graduates (figure to left).This leaves a large "empty quarter". In any organization, especially older organizations, this is a significant number of the employee base that may never participate in mass collaboration opportunities provided by web 2.0 in the enterprise. The knowledge and insight in this crowd however is paramount. Over and over again, the evidence such as Jim Collins work in "Good to Great" indicate, greatness requires deep insight only afforded through rich experience & organizational wisdom.
So if we need this empty quarter to participate, and we have the tools to allow for collaboration, how do we tap into their insight? The common answer suggests evangelizing to this group. Changing the culture so they become included. For those involved with culture change will realize that this is by no way a simple feat! Perhaps it's not about changing the culture so they adopt but rather simplifying the experience and focusing on the individual. This viral approach could then result in a corporate culture shift. Perhaps we can learn something from the iPOD.
Although I haven't done my own quantitative studies, I suspect that the MP3 Market, prior to the iPOD followed a similar pattern to that of Enterprise 2.0. Recent grads & techno-savvy were the adopters... Apple could have came up with a similar product and attempted to "evangelize" the features and functionalities. Perhaps try to change the "culture" to increase adoption. They didn't (well not at first). Instead they focused on extreme usability which dives deeper than the "cultural" aspects into the "individual". By stripping away the fluff, and focusing on extreme usability the individual needs & wants could be addressed. If you like music you'll like the iPod. We don't need to convince you it's worth the headaches of understanding the technology because there are no headaches.
Same thing for massive collaboration and Enterprise 2.0. Deeper than the corporate culture are the individual motivators. I am not going to dive into Maslow's hierarchy on this blog but it is related. The individual need to communicate, and be part of social group is a core attribute. Man by nature is a social creature. Enterprise 2.0, if made extremely usable can tap into this. The impact could mean that rather than changing the culture so they adopt Enterprise 2.0 technologies, that Enterprise 2.0 technologies could change the culture through the individual. Evangelism should consider this, and move away from justifying the complex and focus on extreme simplicity.
Sunday, February 4, 2007
SOA - D.O.A.?
Are you tired of hearing about Services Oriented Architecture aka SOA yet? Like anything that gets as hyped as SOA, the term is becoming less and less helpful. My biggest concern with SOA however is that it's often being driven by the technologically oriented... Why the term itself drips of techno-speak... The potential offered by SOA is much more than technology it's about agile business process on-demand.
What's wrong with the technical approach to SOA? Simply put, the problem weighs the advantages of organizational efficiency greater than that of organizational effectiveness. We view SOA as a means to reduce costs through re-usable services allowing for faster application development. To do this we look at infrastructure components such as hubs, protocols, standards, repositories, development practices, etc... Yes, reducing costs to the organization and being able develop applications faster are good outcomes but it's only one aspect and quite frankly only a short-term advantage.
As organizations drive efficiencies in their applications through SOA, standardization and re-usability, they reach a point where the innovation they originally heralded as breakthrough becomes replicated en masses. At this point, trying to maintain this innovativeness becomes hugely cost in-effective as other organizations, with the sole purpose of delivering a 'best practice' arise and start to accelerate R&D and drive efficiencies. Geofferey Moore talks about this as moving from core to context. and Clayton Christenson discusses the shift from 'disruptive' to 'sustainable'. In other words if your focus on SOA is about driving efficiencies, it will eventually be replicated and further advanced through organizations that will specialize on this. Google recently addressed this as well in their call to CIO's to outsource almost everything.
So if SOA drives efficiency but that is only a short-term advantage what more is there? The answer is that SOA isn't just about developing new apps faster. It's about providing a Process driven fluid application. It's the intersection of SOA and BPM that will result in a sustainable competitive advantage. It's not just about building applications focused around end-to-end processes but the acceptance that those processes are subject to change and re-change and re-change. They will change in response to the environment. They will change because the focus for SOA should be on innovation. "Best Practices" in end-to-end processes will be sure fire way to eventually become average!
If we start with Business Process though we design our services around the processes. Either building services or buying services or sharing services are all possibilities. The breakthrough happens around an organizations ability to then rapidly re-adapt it's processes when it sees fit. This means we are not constrained to slow and costly IT to have the business transform. Wrap this with tools designed to move away from code and go to modelling and you start to create a platform for business process. Using innovation specific to your organization (NOT the industry) will allow you to do something your competitors can not simply buy off the shelf.
This could have catastrophic implications to companies such as SAP that have had for years provided us with "best practices" through proprietary means. That's another blog, but I will leave it that SAP is transforming though to capitalize on the potential. IF they can make their vision work...
If we don't move away from SOA as a technology focus to SOA as the platform for BPM focus, the rewards will only be a fraction of the opportunity.
What's wrong with the technical approach to SOA? Simply put, the problem weighs the advantages of organizational efficiency greater than that of organizational effectiveness. We view SOA as a means to reduce costs through re-usable services allowing for faster application development. To do this we look at infrastructure components such as hubs, protocols, standards, repositories, development practices, etc... Yes, reducing costs to the organization and being able develop applications faster are good outcomes but it's only one aspect and quite frankly only a short-term advantage.
As organizations drive efficiencies in their applications through SOA, standardization and re-usability, they reach a point where the innovation they originally heralded as breakthrough becomes replicated en masses. At this point, trying to maintain this innovativeness becomes hugely cost in-effective as other organizations, with the sole purpose of delivering a 'best practice' arise and start to accelerate R&D and drive efficiencies. Geofferey Moore talks about this as moving from core to context. and Clayton Christenson discusses the shift from 'disruptive' to 'sustainable'. In other words if your focus on SOA is about driving efficiencies, it will eventually be replicated and further advanced through organizations that will specialize on this. Google recently addressed this as well in their call to CIO's to outsource almost everything.
So if SOA drives efficiency but that is only a short-term advantage what more is there? The answer is that SOA isn't just about developing new apps faster. It's about providing a Process driven fluid application. It's the intersection of SOA and BPM that will result in a sustainable competitive advantage. It's not just about building applications focused around end-to-end processes but the acceptance that those processes are subject to change and re-change and re-change. They will change in response to the environment. They will change because the focus for SOA should be on innovation. "Best Practices" in end-to-end processes will be sure fire way to eventually become average!
If we start with Business Process though we design our services around the processes. Either building services or buying services or sharing services are all possibilities. The breakthrough happens around an organizations ability to then rapidly re-adapt it's processes when it sees fit. This means we are not constrained to slow and costly IT to have the business transform. Wrap this with tools designed to move away from code and go to modelling and you start to create a platform for business process. Using innovation specific to your organization (NOT the industry) will allow you to do something your competitors can not simply buy off the shelf.
This could have catastrophic implications to companies such as SAP that have had for years provided us with "best practices" through proprietary means. That's another blog, but I will leave it that SAP is transforming though to capitalize on the potential. IF they can make their vision work...
If we don't move away from SOA as a technology focus to SOA as the platform for BPM focus, the rewards will only be a fraction of the opportunity.
Saturday, February 3, 2007
6 Degrees of Innovation
I recently presented at the McMaster University World Congress of Innovation on the topic of social computing at Bell Canada. You can read about it on Martin's blog.
http://martin.cleaver.org/blog/2007/01/28/mcmaster-congress-enterprise-20-id-ah-at-bell-systems-and-technology/
In this presentation, I discussed a recent episode of Dateline that examined the theory of "6 Degrees of Separation" and how they randomly took people from around the world and demonstrated they were connected through a series of people (a social network). Over and over, people have been demonstrating this phenomenon to support the theory. An interesting point from a collaboration & innovation perspective is it means that ANY piece of data, ANY piece of insight, ANY piece knowledge or creative thought is ONLY 6 steps away from me. If one could harness this, imagine the breakthroughs!!!
But that's the question isn't it? How does one navigate this social network?
Well one answer is that you don't. Instead let the path come to you. You can open it up to the world and let the millions of people come to you. Theory only? Absolutely not. Pick up Don Tapscott's most recent book, "Wikinomics" and you'll read several examples of this. Good, Bad or Indifferent, those barriers that enabled the few to control the message has shifted in new and evocative ways.
http://martin.cleaver.org/blog/2007/01/28/mcmaster-congress-enterprise-20-id-ah-at-bell-systems-and-technology/
In this presentation, I discussed a recent episode of Dateline that examined the theory of "6 Degrees of Separation" and how they randomly took people from around the world and demonstrated they were connected through a series of people (a social network). Over and over, people have been demonstrating this phenomenon to support the theory. An interesting point from a collaboration & innovation perspective is it means that ANY piece of data, ANY piece of insight, ANY piece knowledge or creative thought is ONLY 6 steps away from me. If one could harness this, imagine the breakthroughs!!!
But that's the question isn't it? How does one navigate this social network?
Well one answer is that you don't. Instead let the path come to you. You can open it up to the world and let the millions of people come to you. Theory only? Absolutely not. Pick up Don Tapscott's most recent book, "Wikinomics" and you'll read several examples of this. Good, Bad or Indifferent, those barriers that enabled the few to control the message has shifted in new and evocative ways.
Welcome To My Blog
Welcome to my blog. After reading blogs for years, I finally decided to jump into the blogsphere. Why now? Not sure really. It's not that I have any more time to spend on this. Perhaps it's the realization that web 2.0 is just too big to not be a part of. In any case, I hope to provide some of my thoughts around the areas of collaboration and innovation. Thanks for visiting!
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