Let’s First Determine Our Needs.
Then Develop The ROI.
To Properly Prioritize Our Next Steps.
The purpose of this blog is to highlight what I believe is a misguided way to select and implement new technology.
Disclaimer: IBM i is an operating system. iSeries and AS400 are servers. I use them interchangeably to make it easier for people to research on the web.
I have been speaking to several executives with legacy IBM i (iSeries/AS400) applications and a new CIO that wants to leave IBM i for a Windows MS XA solution.
Bias For Good Business
To be clear, I have a bias in favor of IBM i for business-critical applications.
After that, I have a bias for making good business decisions.
Tech Jargon? Colorful Metaphors?
I am told that the new CIO is saying that the IBM i (iSeries/AS400) server is “old technology”, “monolithic” (not sure what that means) and out-of-step with the “digital age.” Do you remember the bell that let us know when we arrived in the “digital age”? I don’t.
The new CIO also says Windows supports “bimodal information technology”. What is that? I googled this – it includes 1) safety and accuracy and 2) agility and speed.
What bunk!
In my IT career I have always been amazed how “IT visionaries” use big vocabulary and colorful metaphors to dramatize new technology that may not have a payback.
Let’s dig deeper into this CIO’s “recommendations”.
Deeper Dive Into “Recommendations”
He proclaims, “We should implement Microsoft D365 and adapt our procedures to fit that software solution.”
That is sheer nonsense.
If you are like me you have seen countless failures where business implemented software was NOT suited to the business operation. Millions of dollars wasted on failed implementations.
Is it any wonder that 75% of software implementations fail, according to Gartner research?
What’s Missing?
For starts, the businesses I have seen that are most successful have a clear idea of what their business is and how to execute their strategies to grow. Several excellent books that discuss this include Jim Collin’s Good to Great and several of Richard Koch’s books, especially The Star Principle and Simplify.
Next, technology is implemented to support the business instead of adding technology because it is “cool”, “ideal for the digital age” or a panacea to fix the business.
In Good to Great, Jim Collins highlights this point in Chapter 7, “Technology Accelerators.” Collins contends that the good-to-great companies approach the prospect of new and emerging technologies with the same prudence and careful deliberation that characterizes all of their other business decisions. Further, these companies tend to apply technology in a manner that is reflective of their core business strategies — typically by selecting and focusing solely upon the development of a few technologies that are fundamentally compatible with their established strengths and objectives. Collins characterizes the ideal approach to technology with the following cycle: “Pause — Think — Crawl — Walk — Run.”
What’s A Better Approach?
First, if you are going to change, management and the key power users should clearly document in writing their needs. This is more than a list of what we do and a wish list of what we want. This is clear definitions of transactions, screen designs, file layouts and reports. The more specific the better, so you have a CLEAR sense of what you need and how the various solutions can fit YOUR needs…not the other way around.
During this process of needs definition, the team should document the savings that will be achieved with the improved software. This MUST be measurable.
Second, establish a clear Request for Proposal (RFP) for your solution providers. They need to understand your needs. And, you should INSIST they show you in depth how your data works with their system…and how their system does what you need.
Third, no software solution is a perfect fit. So the solution providers should clearly explain how they can customize their solution to fit your needs.
Fourth, your solution providers should give you a detailed written proposal documenting the solution, the project plan and costs.
Add Cost of Disruption
Besides the cost of software, program customization, project management and training, you should also determine the cost of disruption of new software. Remember 10-30 years ago when you first put in an ERP system…how painful and disruptive it was? With a new system you can expect similar disruption and pain. It is the nature of the beast.
Now you can start the evaluation of the various suppliers.
Calculate Return On Investment
Also, with a sense of cost for the project and expected savings, you can calculate your Return on Investment (ROI) for a solution that fits your needs.
When you have a clear idea of the costs, the payback and when you can expect results, you can better prioritize your projects to improve your systems.
Clearly, what I have explained is hard, arduous work.
And, you should have a clear idea if the new project is financially worth it.
In your evaluation, you may determine it is far less expensive and disruptive to modernize the solution you already have instead of “rip and replace” your business software.
Need Help With Software Needs Assessment And RFP Development?
Our consulting team can help you.
Call me at 714-593-0387 or email me at blosey@source-data.com.
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