For the last few years, there have been many calls and articles about the importance of STEM – Science, Technology, Engineering, Mathematics. I’ve seen the acronym used most often in US-based communications, but it’s seen as an issue in other countries as well; for example, in South Africa we tend to talk about “Maths and Science”. The STEM proponents say the growing these skills is the only way we will be able to ensure employment in a world that is becoming more automated and smarter. But I am now hearing a different view, that there is more to work and life than maths and science skills. Continue reading
An article on the McKinsey site recently discussed the issue of developing and retaining IT talent, especially the key skills it believes are necessary for organisations planning to become a digital enterprise. For an enterprise to become digitized it needs to implement transformative IT-oriented projects, and without the necessary IT knowledge and experience, projects often overrun on budget and time, and don’t deliver value. However, being McKinsey, the article is targeted at large organisations, whereas I am more interested in how small or mid-size businesses (SMBs) can apply their advice.
McKinsey highlights three IT roles which companies should keep in-house.
- IT program manager
needs to oversee the project, understand both the business context and the technology involved, and have strong management capabilities. He or she must also be able to talk about technology and business decisions in a language that business managers understand.
- Business change leader
responsible for ensuring that the organization adopts the new solution. This role requires strong communication skills and an understanding of the full amplitude of the transformation and its implications for the business side, including required organizational, process, and mind-set changes.
- Lead IT architect
responsible for reviewing and challenging technical proposals and deliverables such as solution design and IT architecture. He or she needs to understand the current IT architecture and also have a good view of the transformation journey to ensure that decisions fit with the architecture road map.
Why could this not apply to SMBs? Because SMBs typically have staff with multiple or overlapping responsibilities, while larger companies tend to have more specialised, narrow roles. SMBs also dont’ usually have the budget to hire such specialised staff.
Therefore I would modify the McKinsey article for SMBs. Here are three existing roles in an SMB which could take on the responsibilities mentioned above.
- CFO or Financial Director – IT program manager role
In most SMBs I have dealt with, the overall responsibility for IT has been with the CFO or FD. Therefore this dual role should not pose a major problem for most SMBs.
- Human Resources Manager – business change leader role
This is the dual role that could be controversial. In some SMBs, the HR manager role can be mainly administrative, however unless the CEO wants to take on this responsibility, HR would seem to be only only other option.
- IT manager – lead IT architect role
A non-brainer in my opinion. The only manager in an SMB with the background and skills to do the IT architect role is the IT manager.
I would be interested to hear if any alternatives are suggested.
In a blog on the ITtoolbox site, Steve Phillips comments that companies are moving away from using external ERP consultants in favour of using in-house expertise – Why ERP Software Consultants Cannot Save The Day.
His view is:
The ownership philosophy is about controlling your project destiny and built on some fundamental principles. … 1) It is possible to take internal responsibility for project management. 2) It is possible to develop and/or acquire internal software expertise to the point outside application consultants are rarely needed. 3) It is possible to become much more educated and less reliant on the false sense of security an army of consultants can bring. 4) It is possible to realize ERP benefits by developing better software and business process solutions with fewer outside consultants. 5) It is possible for internal personnel to do up to 70% of what many pay consultants to do.
Except for item 4, in my experience, I haven’t found any companies that can do what he suggests. I suspect it is a function of certain factors – a primary one being the size of the organisation. But I also believe that business maturity, and the availability of knowledge and experience play a significant part.
In the South African market, most businesses fall into the small-to-medium (SMB) category. Employees in SMB companies tend to take on more than one role (debtors and creditors, pre-sales technical and sales, production planning and management) which leaves them little time to focus on issues which are not directly relevant to the job they must do. So finding time to acquire software expertise is difficult or requires after-hours learning. In time, and if a person stays in the same job, they might become “more educated and less reliant.” However, given their time constraints, it is highly unlikely that people will have the time or knowledge “to do up to 70%” of what a consultant will do.
Also skills and expertise are in short supply in this country, so someone who develop technical skills may easily find themselves moving out of their business job and into a technical or consulting role. Similarly, project management requires experience and time to spend on it, which senior staff in SMBs (e.g., finance managers and directors) rarely have. Companies will tend to have a less senior person overseeing the project, but all the details and work that goes into project management has to be done by someone with the background and time allocation to do it – in other words, a consultant.
In the South African context, therefore, most average companies (not large ones over 1000 people) do not have the people, skills or time to take on an ERP implementation themselves. The cost of bringing in consultants outweighs the risks of failure in trying to do the project in-house.
Time has an article on Malcolm Gladwell’s Outliers book. One of the significant points in his book is the 10,000-Hour Rule. According to TIME, there is a reason for this rule.
Studies suggest that the key to success in any field has nothing to do with talent. It’s simply practice, 10,000 hours of it — 20 hours a week for 10 years.
If that’s correct, I’m probably at or close to my 10,000 hours in ERP. I started working for an ERP company, JD Edwards, at the end of 1998. Apart from a break of seven months during 2003, but I have worked with JD Edwards, Microsoft Dynamics NAV and SYSPRO ERP for just over ten years – in project management, sales and marketing.
I just wonder how soon after the 10,000 hours does success begin 🙂
What I mean by legacy ERP are older ERP applications that were acquired by companies like Oracle and Infor. As a former employee of one of the older, I am interested in the JD Edwards (JDE) solution that Oracle acquired a few years ago.
Responding to a comment I sent him about the Oracle user conference, a contact at a long-time JDE client in South Africa, said:
Like most other companies, the rather messy Oracle world environment led our company to rather look at a SAP migration – its not planned locally for another 5 years, thus we still run JDE – but World version! [ed: the AS/400 green screen version] Needless to say, Ifusion and other developments are really not applicable to us – I do stay in touch with Oracle though, but primarily about Oracle retail – eg Retek. We don’t run it, but all the major SA retailers do, and it’s a good occasion to meet with my peers in retail. The JDE world has shrunk smaller and smaller through the years…
I wonder how many JDE customers are just hanging on until they have budget, time and justification to change? So, is Oracle flushing money away by building its ifusion architecture to try to keep its legacy ERP customers? It seems Oracle would do better to invest in its vertical solutions (like Retek) and stabilise its legacy products so that it can milk those customers for as long as possible without having to spend too much on new development.
Also, if I was a JDE consultant/developer/specialist I would start looking at training and certification on other ERP apps – probably SAP, a Microsoft Dynamics product (but not Axapta), or SYSPRO.