Save Private Ryan or ROI again
Project Manager John Miller gets a tough job. Together with his project team, Miller must go deep into his organization in search of employee James Ryan, who is said to be instantly adaptable to any new information system and immediately begins to apply new ways of working. The organization’s management decided to find Ryan and, with his help, reanimate the project of introducing a new information system. But in order to achieve a return on investment, the project team will have to go through all the circles of hell ...
I recall the old IT bike about how an ERP system was implemented in one metallurgical holding. At some point, the resistance to the project reached such a level that the general director sent a letter to all employees of the company with the following content: “Dear colleagues, you, of course, can not use the new software in your work, but then you will not work with us ".
Why this example? When a conversation starts about the introduction of a new information system, conversations about the return on investment come. In his book “ What IT wants a business from IT"Terry White showed that it is really possible to convert all the benefits of using the new system, as well as all the costs of its implementation, into money and determine the payback period and profitability of the project. An approximate layout is shown in the figure.
But, in my opinion, when the advocates of the new project consider ROI, they put in the model a number of assumptions aimed at demonstrating the most ideal situation in terms of terms of return on investment. I see three such assumptions:
What is the result? It seems that even such a super-obligatory thing as an ERP system can experience enormous resistance of personnel during implementation and reach the payback point in an unclear future.
I bow my head to those who evaluate the above aspects and immediately put them into the project. For those who have not done this yet, I suggest that these aspects be included and worked on so that users 1) learn about the innovation in a timely manner, 2) personally find the value of the innovation for themselves, 3) study the new system, 4) apply a new way of working and 5 ) formed a new habit . Without this, the long-awaited moment of return on investment from the information system may not come.
All this work requires a massive and quick exchange of information throughout the organization: explaining the idea from management to staff, informing the project from the project manager to the project team, training a new product from the project team to users, problematic questions from users to the project team, objections from users back to management, management responses to user objections, success stories from management to the entire organization, and so on and so forth. For such tasks, a conference room that can accommodate all participants and users throughout the project is ideal. Alas, this does not work out in life, therefore, with the introduction of information systems, and in general during all sorts of organizational development, you can use an alternative and cheaper option - a corporate social network. Because it is a dimensionless virtual meeting room for communication with almost everyone, with 24 to 7 access, in any convenient place of the user's stay.
But a corporate social network is not a patch. All of the above applies to herself. In order for employees to start using the new virtual “meeting room”, they also need to make certain changes in the organization, they also need a separate project. And those organizations that took this seriously and really established a broadcast, social, network exchange of information are more likely to achieve success in their development. And reached it faster.
PS. We assume that with this article I fulfilled my promise to complete the series of notes about corporate social networks and return on investment (see part 1 , part 2 , part 3 , part 4 ).
Vladimir Ivanitsa Facebook | LinkedIn
I recall the old IT bike about how an ERP system was implemented in one metallurgical holding. At some point, the resistance to the project reached such a level that the general director sent a letter to all employees of the company with the following content: “Dear colleagues, you, of course, can not use the new software in your work, but then you will not work with us ".
Why this example? When a conversation starts about the introduction of a new information system, conversations about the return on investment come. In his book “ What IT wants a business from IT"Terry White showed that it is really possible to convert all the benefits of using the new system, as well as all the costs of its implementation, into money and determine the payback period and profitability of the project. An approximate layout is shown in the figure.
But, in my opinion, when the advocates of the new project consider ROI, they put in the model a number of assumptions aimed at demonstrating the most ideal situation in terms of terms of return on investment. I see three such assumptions:
- Users instantly adapt to the new system. In fact, in the above example, and almost always, at the beginning of the project, users resist change. But even after you have convinced them, with a purely kind word or with a kind word and a revolver, people do not immediately learn how to work. They spend long hours in training, courses, or just trying to take the first steps in the system. And in general, they do not seek to quickly master the new system and start using it.
- Users use 100% of the functionality of the new system. This is also not so. Here, for example, according to this report, the coefficient of efficiency of using ERP systems in Russia is 81%. Specifically, with ERP systems, this is probably close to the truth, but on the whole I would rather believe in the rule that users use only 20% of the functions embedded in the software. I remember the statistics of the perception of new knowledge after passing classical trainings, that is, trainings, when you are taught a couple of days, then the trainer leaves and no one else bothers about how much you have mastered new competencies. So 20% of the total volume of material is remembered, and only 5% is applied. It turns out that at least several iterations are necessary for users to reach at least an average of 20%.
- Users apply the new system in accordance with the idea. In essence, this is the belief that information systems themselves have a competitive advantage. But even if users have studied the new system, they still have to change the way they work in such a way that business results from applying the new system begin to be realized. For example, as part of our recent project on introducing a social portal, my colleague individually taught the department head how to use Jive for two days . After that, he went into a group of ping-pong fans and expertly applied the acquired skills there, and the department continues to work as usual.
What is the result? It seems that even such a super-obligatory thing as an ERP system can experience enormous resistance of personnel during implementation and reach the payback point in an unclear future.
I bow my head to those who evaluate the above aspects and immediately put them into the project. For those who have not done this yet, I suggest that these aspects be included and worked on so that users 1) learn about the innovation in a timely manner, 2) personally find the value of the innovation for themselves, 3) study the new system, 4) apply a new way of working and 5 ) formed a new habit . Without this, the long-awaited moment of return on investment from the information system may not come.
All this work requires a massive and quick exchange of information throughout the organization: explaining the idea from management to staff, informing the project from the project manager to the project team, training a new product from the project team to users, problematic questions from users to the project team, objections from users back to management, management responses to user objections, success stories from management to the entire organization, and so on and so forth. For such tasks, a conference room that can accommodate all participants and users throughout the project is ideal. Alas, this does not work out in life, therefore, with the introduction of information systems, and in general during all sorts of organizational development, you can use an alternative and cheaper option - a corporate social network. Because it is a dimensionless virtual meeting room for communication with almost everyone, with 24 to 7 access, in any convenient place of the user's stay.
But a corporate social network is not a patch. All of the above applies to herself. In order for employees to start using the new virtual “meeting room”, they also need to make certain changes in the organization, they also need a separate project. And those organizations that took this seriously and really established a broadcast, social, network exchange of information are more likely to achieve success in their development. And reached it faster.
PS. We assume that with this article I fulfilled my promise to complete the series of notes about corporate social networks and return on investment (see part 1 , part 2 , part 3 , part 4 ).
Vladimir Ivanitsa Facebook | LinkedIn