In the past as certain technologies mature they became pervasive and eventually disappear into the fabric of the world around us. For example, a device like a cellphone has now become a commodity item and we take it for granted that people can communicate via voice, SMS, e-mail and video through a small portable wireless device from just about any location.
Ten years ago I worked in a plant environment where cellphones were limited to management only and there were less than 10 in the whole company. Now every employee in the same plant carries a cellphone. In a few short years we have all simply forgotten how useful a communication device a mobile phone has become.
It is my observation that in the manufacturing sector, to a large extent, information technology has become sidelined by its own success. For years IT managers concerned themselves with implementing reliable information infrastructures. Business systems had to operate 24x7. Failures had to be constrained to a few hours in a year and the mean time to repair had to come down to minutes. Is it therefore really surprising that business leaders have come to regard their IT systems as mere commodity infrastructures, unable to add new strategic value and in the same category as office buildings, telephones and photocopy machines? IT managers may be tempted to switch off the mail server for several days just to prove a point.
This dilemma faced by IT managers in manufacturing is real. Successful technology that works well must disappear into the fabric of the business. When a core business system goes down things can get very ugly and IT managers do everything they can to avoid failure by investing heavily in system reliability. However, after the implementation is over the inherently very reliable business system is somehow forgotten for the underlying value it continues to create for the organisation, for example by co-ordinating financial, supply chain, HR, manufacturing, procurement, sales and logistics processes.
In a recent discussion with a leader of a reasonably complex manufacturing company I realised that in fact managers do want the IT systems to disappear in the sense that, in his view, the underlying business processes just need to operate reliably and with integrity so that managers can focus on the areas that are far less predictable – markets, customers, competitors and so on. Like when purchasing a cellphone contract, people want their business systems to just work without any issues.
In the manufacturing systems environment two types of distinct IT professional emerge. The first is concerned with the reliability, stability and underlying predictability of the IT platforms, systems and applications. They succeed when the systems disappear. The second, equally important category is the group who constantly stretch the boundaries of technology to extract the last residual value and opportunity from the existing and new IT investments. The second is challenged by the need to create value. This group works tirelessly to align IT and business strategy, innovate frequently and accepts that failure in projects is an inevitable consequence of taking risk, but that when projects succeed the risk is generously rewarded. Both categories of IT professionals are critical to the ultimate success of the business and when in balance both complement each other.
The mistake that companies sometimes make is that they fail to recognise the fundamental differences in motivation in their IT staff. As a result of a lack of insight these companies try to manage IT as a homogenous environment. Inevitably the emphasis will either be on stability or innovation but rarely both in balance.
As technology disappears into the fabric of the world around us, both companies and individuals grapple with how to create differentiated business value with what is perceived as a commodity service. The software vendors also recognise that technology is rapidly commoditised and in order to retain competitive advantage they have to consistently and convincingly illustrate business value. They recognise that business value is created by close alignment with the challenges in vertical industry segments. The leading providers of business systems are therefore increasingly vertically focused. While still leveraging the big brand to give confidence they nevertheless have to organise themselves internally along functions that have deep, credible knowledge of the target industry itself. In manufacturing companies these specialised competencies include manufacturing, operations improvement, supply chain and logistics, information management, sustainability and customer relationship management.
In assessing the efficiency of an IT department in a manufacturing company it is no longer adequate to measure the pure commodity service. Leaders in manufacturing need to challenge IT professionals constantly for value add and alignment with business objectives. They need to challenge and constantly assess the impact of the vertical focus of the suppliers of their critical business systems. They need to do this while at the same time respecting and also recognising those individuals who take great pride in the fact that through the reliable infrastructure that they now maintain they have perhaps become victims of their own success.
For more information contact Gavin Halse, ApplyIT, +27 (0)31 275 8080, halseg@applyit.co.za, www.applyit.com
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