Don’t forecast 10 years ahead

tarot-991041_640An article on Medium written at the end of 2015 tries to predict how we will be living in 2025. The problem with predicting so far out, and ten years is far out, is that we cannot possibly know how things we haven’t even thought about will dramatically impact our lives.  It got me thinking what someone in January 2006 would have missed when predicting how we would be living in 2016. Continue reading

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IT talent needed for SMBs

1410454581_skillsAn 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.

What journalists don’t understand about M&A in tech

There is an article in BusinessWeek about SAP acquiring software companies.  As it’s a story on a business-oriented site, the emphasis on matters financial is accepted. However it did make me question whether (some) journalists understand the impact of M&A in software companies.

The article mentions firstly that SAP has struggled to catch up with Oracle and Salesforce.com, but considering Larry Ellison discounted the cloud until fairly recently, and SAP is still the largest enterprise software vendor, I wonder what ‘catching up’ the writers are thinking about. From the way they write, it appears the writers think that the only real software business must be cloud based.

The emphasis of the article though is on the acquisitions SAP has been making. It find it interesting that, again, the writers compare SAP against Oracle, calling Oracle ‘a deal-making machine’; as though deal-making should be a major focus of a software company.

What I see in the article is an appreciation of M&A for investors; I don’t see an appreciation for what it means to customers, and the work that must be done internally by developers to meld the software together. Vinnie Mirchandani has made the point that:

… most CIOs are still ambivalent about technology M&A. As most will honestly say, we gave Oracle (or IBM or whoever) a chance to competitively win our business a few years ago and they did not. They are backing into our business with acquisitions.

Tom Peters has been vociferous about it:

 why do these ego-maniac CEOs keep merging…? Why do their boards sign off? Why does Wall Street go along?

I worked at a US software company some years ago that did a few acquisitions, and saw the problems that it creates.

Software from two different companies rarely has the same user interface and user experience, and the integration of the two systems is often complex. Despite the best efforts of developers to sort out the technical challenges, customers have to bear the brunt (ie, cost and trouble) of the early integration implementations.

So instead of focusing so much on the money side, why don’t journalists explore what the impact will be for existing customers – whose payment of annual maintenance revenues funds  the M&A activities.

Productivity, employment and manufacturing

Andrew McAfee has written another post on his blog about how employment appears to have been affected by technology. He quotes research by Jared Bernstein which shows how employment and productivity are diverging, and which attributes its to outsourcing and off-shoring.

I remember when that trend started to take root in the US around the Y2K period, and was continually amazed at how the corporations that did it, and the society it occurred in, were more interested in the short-term gains (lower costs and prices, higher profits) than the obvious long-term consequences (less local industry, more unemployment).

In my opinion, the solutions for the US is to start ‘re-shoring’ and to re-establish its manufacturing sector. A number of  industry publications (e.g.,IndustryWeek and Manufacturing Executive)  have been calling for this. I really look forward to seeing Americans being proud of having a thriving manufacturing sector back in their country.