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Enterprise Systems and Management Theory

  • I picked up the Economist "Guide to Management Ideas" the other day and randomly opened a page. It took me right to ERP. The description of the role of ERP was vague to the point of saying it was software to manage a company. In general, a lot of the taxonomy in software is more marketing driven than functional. I think the de-coupling of applications from services as envisaged by SOA will drive a more useful taxonomy. In Telco - eTOM is useful as long as vendors do not twist it to their marketing needs. TAM is another matter.

    I then opened another page to "Critical Path Analysis". Now the idea is pretty simple - you can't get to point B is C is in the way. Speaking about enterprise software to a senior manager in the health industry he made it clear until the "Point of Sale" (a nurse giving a patient a pill) was on the critical path to accurate billing and cost control. The issue is making the process of submitting the charge quick enough to not get in the way of helping patients. let's call it the massively distributed and heterogeneous charging problem.

    I next turned to "Competitive Advantage" and Michael Porter. I would say that I am neither a believer nor a skeptic. I would just say that effective corporate strategy is more than devising a perfect value chain. Strategy evolves. Your first job as a CEO is to make sure your people and your assets are willing and ready to adapt to new strategies. I see a lot of initiative's in telecommunications that sound like do or die "strategic initiatives" - it is as if changing or even evolving strategy has to be costly. It shouldn't be - and IT must be an enabler.

    The next section I opened was "Differentiating". Another Michael Porter bit. The simple idea is that companies differentiate on price or on product. I think product in service industries is much more than the service you buy - it is how you buy (orders, bills) and how you consume (service requests, self-customization).

    I then skipped the page to M: "Mass Customization". The idea was founded around 1997 to 1999 and applied to manufacturing. I think it applies to software as well. In general most enterprise software conceived prior to the millennia pre-dates this concept. I think this one fact is the bane of the CIO to this day. His systems deliver mass produced business logic - but he wants massed produced business logic customized to meet his company's strategic needs. It is not customization of software the CIO needs - it is the customization of business processes. A lot of new software such as SOA enablers and SDP's are about delivering business process customization. The big applications lag considerably.

    Finally I got to S. You would have thought I would go straight to "Strategy". But I thought "Satisficing" was more interesting. This is the idea that consumers and business administrators cannot truly understand complexity (of what they buy or how their businesses work.). A good salesman takes advantage of consumer satisficing - the more complex the product the more advantage goes to the seller (life insurance and cars come to mind). The same applies to business to business (IT comes to mind). In fact a CRM vendor recently said as much saying the "sufficient" was what CIO's wanted - he did not say what they didn't want.

    Anyway - enough for today. Next time I will go through Heidegger's Space and Time and see what how to apply "Dasein" to billing and I am only half kidding!

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