Turn your business inside out

Add systems of record to systems of engagement. Stir vigorously and watch what happens

There's a startup based in London that you should spend some time getting to know: Evrything (not a typo). Is it uber-cool? Yes. Is it massively social? Of course. But the real story in its offering is the sheer disruptive force the company's concept represents to systems of record governing the supply chain.

The basic premise behind Evrything is that every product your company sells potentially gives off streams of real-time data, provides a point of interaction with social platforms, and churns information among third parties that never touch your internal radar screen. This will cause some IT leaders to break out in hives, while others will see a huge opportunity.

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That's the heart of the issue: the need to reengineer our thinking about the value of systems of record versus systems of engagement.

Most companies have spent several decades building out systems of record for ERP, HR, and the usual suspects. Millions of dollars have been invested, and millions more are spent on maintenance. All of these systems are built on a foundation of business processes conceived at a point in time that, in all likelihood, no longer meets the need for agility in the business today.

But we march forward. We patch the process and the systems. We do this for obvious and substantial reasons such as legal and regulatory compliance, as well as information security. It's expensive and time consuming, and very often, it leaves the business less than satisfied with the flexibility or capability of the outcome.

Systems of engagement have a substantially different value proposition: integrating social and collaboration capabilities with the everyday transactions of the business. The vast majority of these solutions is less hardened versus their legacy counterparts, and they're now more typically implemented and maintained via a small ecosystem of partners and third parties. In essence, they tend to be more cutting-edge from an interface perspective and fit more tightly into the average user's experience. In fact, for an increasing number of users, these are the systems of record for conducting business.

All this points to our overarching challenge: What's the right strategy for integration between the two camps of the IT world that Geoffrey Moore so kindly divided for us? The older I get, the more I'm a fan of simplicity, and this balancing effort is no different. Treating this like a true collaborative assessment effort makes a lot of sense: evaluating the tools, processes, economics, and risk profiles first and making logical road maps to move forward. Most important, these two worlds will not stay segregated forever. In fact, in the next few years both will simply become features of broader, more robust, and more social systems that govern our businesses.

In the interim, there are immediate wins for the IT organization in honing the process for -- and exchange of data between -- systems of record and engagement. We spend a ton of time evaluating and optimizing systems on their technical merit, but we need to start investing in the evaluation of how they serve the business. Rather than trying to replace, retrofit, or overlap, look at how the underlying data is captured and utilized. I'll bet you'll find more than a few places where similar or identical data is being captured three or more times to serve different purposes. Workday has become the darling of HR systems by mastering this exact notion during implementation, and it's displacing huge swaths of budget in the process. Nothing adds up faster than resource costs, and by looking closely at how data and process dovetail, you'll add value quickly and in meaningful amounts.

Another big win comes from the optimization of both environments using cloud services to bridge capability gaps. The business loves any CIO that speaks to a strategy of "cloud first" solely on the merit of using a buzzword people enjoy hearing. They feel warm and safe and confident their IT group is headed in the right direction. Use this to your advantage, and start investing in the transactional and data analysis capabilities the cloud can offer both sets of systems. This middle ground also lets you (safely) experiment and innovate quickly with a variety of business units and demand sets, while maintaining a run rate of cost that's in line with expectations.

There's a lot more to this discussion and many additional ideas to share, but in today's market there's little downside to taking advantage of the opportunities presented by evaluating your systems of record and engagement. The unifying solutions are available, the business is demanding new capabilities, and you have the opportunity to significantly affect the run rate cost of IT in the process.

Just remember, like so many other endeavors of the IT organization, your "solution" will always be superseded by the need for the business to get things done. Keep that thought at the top of your priority list.

Copyright © 2013 IDG Communications, Inc.

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