Sunday, August 24, 2008

Thought, Actions, ROI – Almost Inseparable

With all of the frustrations conjured up each and everyday because of computers and software, one would be very hard pressed to confess they would rather return to a world without technology. The conveniences of modern day living is a direct result of technology. With all of its problems, software technology brings value to every use, to some degree. This value can be tied directly to the choices made as to the type of technology and its implementation.

Over the next week close to three thousand people will converge on Dallas Texas for the International Legal Technology Association (ILTA) annual conference. This educational based forum affords leaders from today’s law practices to acquire and share their knowledge with their peers. As an added benefit the forum presents an opportunity for these leaders to meet many of the companies who furnish their organizations with software technology.

With so many vendors presenting their latest solutions, one is very hard pressed to identify the right fit of software for their organization. This dilemma is easily dissected into its component parts. Vendors will proudly profess their value proposition; the value their solution brings to the market. This ‘value’ is demonstrated in all of their literature and hidden in their graphics, logos, presentation and even in their references. Very simply all software will provide user some value, even those camouflaging old technology.

With three or more vendors touting their value, it becomes difficult to select the ‘right’ solution. Or does it? Software selection is a two part process. The first and easiest part is to understand what is available in the market place. The second step in selecting the right fit is in understanding the environment where the solution will be used. This is the area where most organizations have and continue to fail.

Know thy self written by Socrates about 350 B.C. speak volumes on why some organizations fail and others succeed in implementing the SAME solution. This is also the reason why today’s market is filled with consultants selling their expertise under the realm of Six Sigma, Lean Manufacturing, BPR, JIT manufacturing and the list goes on. Armed with the knowledge of what is available, the leader should critically examine their current process which will lead to the ‘right’ fit.

A critical examination is more than a cursory review of how bills get created or how checks are approved. It is a full documentation of the entire process, followed by a critical examination asking ‘why’ at each step; why do we do ‘this’ like this? Six Sigma methodologies refer to this as the DMAIC sub-process. The sub process is outlined as: define measure, analyze, improve and control. The belted consultant would critically review the process asking ‘why’ at each step with a view to make the process more efficient and less prone to errors.
The greatest return on any software solution will not be derived by the solution itself but rather by the revising of the underlying business process. Overlaying a historical business process with new technology only acts to speed up the arrival at the ROI glass ceiling. There are so many examples of organizations changing the tools but keeping the old process. Take for instance the Dvorak Keyboard of the early 1900’s which allowed for higher typing speeds. However it was replaced by the QWERTY Keyboard because of mechanical constraints of manual typewriters. Notice, in today’s age we have yet to return to the Dvorak keyboard; we are too entrenched in history. The world of software is no different; firms continue to muddle through software acquisition and be satisfied with their 10-15% ROI, because of the mentality that the process has always been done this way and we cannot change it. However, the astute firm who reexamines their entire process, making the appropriate changes to streamline their process and enhancing the new technology, enjoys the 40-80% ROI. In the five years from 1995-2000, General Electric learned firsthand how the act of reviewing each process with a critical eye before launching yielded a $10 billion benefit!

A new look at an old process will immediately reveal historical inefficiencies. Once the process is re-scripted, then one is better prepared to ask the critical questions necessary to separate one solution provider from the next; this is what clarifies the difference between average and extraordinary returns on investment. So as you stroll through the vendor halls listening to vendor value propositions, recognize that you, and only you, control your true ROI with any new solution!

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