05.09.08

Making Your Business Free Throws

Posted in Compliance, B2B Outsourcing, Data Quality, Logistics, B2B, Supply Chain at 8:51 am by Bryan Larkin

When Kansas won the NCAA men’s basketball championship in April, it confirmed the tournament predictions of many basketball experts: Memphis wouldn’t and couldn’t win the championship because of their poor free throw shooting.  It just took Memphis to the last minute of regulation in the championship game to prove those prognosticators right.  Yes, up by 3 points with handful of seconds left, Memphis could have called time out and set up a defensive play designed to stop Kansas’ last second drive in regulation.  Yes, Memphis could have fouled Kansas and forced them to take the ball out – thus wasting precious seconds.  And, yes, Memphis could have fouled again, forcing 2 free throws that would have stopped Kansas from attempting a 3-point shot.  All of those things could have helped them win the game.  But in the end, missing 3 of their last 4 free throws in regulation really did Memphis in.  Free throws: the most basic and fundamental skill in basketball.

Memphis was a flashy team with a penchant for “Sports Center highlights”.  And they were very, very good.  They won an NCAA record 38 games this year, and came down to the final seconds of regulation with a chance to win their 39th game and a national championship.  But in the end, Kansas will be remembered as champions and Memphis will be relegated to the sports trivia books as the team that has won more games in a season than any other, yet it didn’t win the championship.

So what does this basketball story mean to us? No, I’m not going to rename B2B as “ball-to-basket”.  But it is Memphis’ failure to get the ball in the basket on their free throws that should catch our eyes.  Information Technology historically has a reputation – often well deserved – for focusing on flashy technologies – the cool moves, the next-big-thing, the fun stuff, the technology equivalent of the “Sports Center highlight” while ignoring the mundane fundamentals of aligning with and supporting the business.  However, these fundamentals, these “free throws” of business, are what wins our championships – improving stakeholder equity and increasing customer satisfaction.

Recently Tony Friscia of AMR Research wrote a nice piece (You’re Not Tiger Woods!) in his executive newsletter “Above the Noise” suggesting that implementing fancy technology solutions without having sound business practices is like the average golfer purchasing a new driver and expecting to radically improve his or her game.  Only if you have sound business practices already will you find value in your investment and only if you are already very skilled and disciplined in your game – like Tiger Woods – will you really benefit from the new driver technology.  In fact, the executives Tony speaks with routinely indicate that they receive no or negative ROI on back-office software “investments”. 

Similarly, this article, penned by yours truly in 2005, draws parallels between golf and B2B mistakes we’ve made over time.  The short of it is that even with all the new technologies, golfers scores haven’t improved in 30 years as they ignore the fundamentals of the game to instead go for the flashy big drives.  As I work with companies, I find that many continue to ignore their fundamentals.  Whether this is ignorance, willing actions on IT’s part, fear of IT in the CEO/CFO/COO seat, or something else, business basics are neglected as IT departments go for the flashy new technology.  Tony’s findings and mine are echoed in an article in CFO-IT a few years back that found that close to 70% of purchased software becomes “shelfware” – applications purchased but whose functionality isn’t utilized.

I have never been a big Colin Cowherd fan, but on April 21, 2008, he made a great point on his radio program.  Success, in sports or in business, is more about having the right culture than it is about anything else.  He pointed to sports and to the University of Wisconsin as an example and how its football fortunes turned around with the arrival of Barry Alvarez because of the culture he instilled.  Likewise he mentioned successful leading companies that have struggled after their CEO was changed and the new CEO didn’t understand and work within the culture of the business (or perhaps the business didn’t change to the CEO’s culture).  Overall he made a compelling argument.

Likewise, John Dvorak made a compelling argument in his 2004 column entitled “The Myth of the Disruptive Technology” which questioned Clayton Christensen’s ideas of disruptive technology.  I support John’s view and, though I am not partial to guns, suggest an analogy to the gun advocates’ saying that “guns don’t kill people, people kill people.”  I’d say that “technology can’t fix business, people can fix business”.  The corollary is that technology can cripple a business if it is lacking the right culture and processes to take advantage of it.

I believe that getting your supply chain automation right – whether you are on the buying or selling side – is about getting your culture right.  And that culture has to support appropriate best practices, not just hot technologies.  And true cultural change depends on having your people buy into what you are trying to do.  It isn’t easy, but it will bring the biggest benefits to your company.  Finding an experienced partner to help in developing and executing those best practices can certainly help, as well.  It may be that the outsourcing trends for IT services – and more recently for B2B services – are a reflection of companies realizing that they can control costs and reduce risk better through a partner motivated to provide success through business “free throws”, not technological “Sports Center highlights”.

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