Geoffrey Moore, the author of Crossing the Chasm and Zone to Win, has a beautiful analogy for what line-of-business pros get wrong about using technology: They think their software is a restaurant, when it’s actually a gym.
“The rest of the company feels like they went to the restaurant, and IT should bring them a system. If we don’t like it, we’ll write a bad Yelp review,” Moore said. “It’s not a restaurant—it’s a gym. IT can bring you the equipment.”
The “equipment” here is a modern, cloud-based system to run the company’s finance, HR, and supply chain functions, and LOB pros must do the hard work of improving processes, training staff, even changing business models to get bottom-line results.
Moore spoke at Oracle Modern Business Experience, a conference in Las Vegas, held March 19 to 21, that brought together thousands of business leaders from finance, HR, and supply chain organizations to explore how to use applications to make their companies stronger.
Below are some quick insights I took from that event:
The Cloud Is ‘Move-in Technology’
“Move-in technology” means that cloud applications are like furnished apartments—they have everything you need to live in them, so you shouldn’t paint the kitchen fuchsia or add a Murphy bed in the family room. “We changed our processes to fit the tool,” explained one hospitality and gaming industry executive, commenting on his company’s implementation of Oracle Cloud applications for general ledger, accounts payable, and human capital management (HCM). “You can’t really customize it to your process. You need to move into the technology.”
The reason “no customization” is a good thing is because Oracle is continually refining its applications to deliver industry best practices for a given function, learning from its customers’ usage and then delivering updates automatically multiple times a year. For this executive’s company, the cloud apps provide a foundation that lets the finance team focus on business process innovation instead of technology maintenance and upgrades. “We have what we need to really transform the close process,” the executive said.
Take Care of Employees, Not Just Customers
The head of HR for a global consulting firm explained how, using its new HCM cloud application, it improved the firm’s hiring process so that more than 90% of job applicants finished the application, way above the industry average of around 60%. That’s a credit to the firm focusing on the job applicant’s experience when it implemented the cloud software.
One problem: Hiring managers didn’t want to use the new system, because the way the firm had configured it required those managers to complete many complicated fields and drop-downs. The lesson learned: “If we don’t put the employee experience front and center, we aren’t going to get the results we expect,” the HR executive said.
Big Companies Can’t Always Act Like Startups
Moore noted that big companies can’t always act like startups. In fact, that’s one of the big ideas behind his Zone to Win book: parts of the company need to focus on performance and productivity zones (the fundamentals of delivering profitable growth, making and delivering products, paying taxes); while others focus on transformation of business models and incubation of new technology. “If you ‘fail fast’ in the performance zone of a large company, you’ll get fired,” Moore said during one Q&A session.
The key thing for executives, especially finance leaders, is to make sure these zones don’t compete with one another. Finance leaders need to allocate assets to each zone, so that their companies aren’t forced to make the false choice between “Do we want to have a reliable accounting close?” or “Do we work on an AI-powered, customer-facing chatbot?”
Talk Revenue, Not Logistics, to Win Support
One supply chain executive with a consumer goods company described exactly this funding dilemma: A big project to update old supply software never made the priority list, so the system was vulnerable to breaking down. The only answer, he concluded, was to move to a cloud supply chain application that would be continually updated as part of the subscription, rather than requiring a big, one-time update project.
To win support for the cloud project, the executive said he got some good advice from a colleague: to compare the cost of the project to the revenue loss and penalties the company faced from a potential logistics system breakdown: “Stop with the logistics lexicon. Start talking revenue,” he advised. “If those trucks were to stop moving for two days, you probably pay for the project. You probably pay for it in one day.”
We’re in the ‘Experience Economy’
In contrast to the industrial and service economies that preceded it, today’s “experience economy” goes beyond getting the product or service exactly right to make the sale. It’s more about understanding what customers do and how they do it, including well after the sale.
“In the experience economy, customers are the innovators in the way they use and experience products,” said Oracle Executive Vice President Rob Tarkoff, who keynoted the Modern Customer Experience event, co-located with Modern Business Experience.
To cash in on this experience economy, companies must help would-be customers quickly find what they’re looking for, choose between self-service or human assisted engagement, consume products via subscriptions versus ownership, and get the care they need before they have a problem. And companies need to capture data and analyze it as customers are interacting with marketing, sales, service, and commerce applications. “That will be your competitive advantage in the experience economy,” Tarkoff said.
AI and Machine Learning Aren’t Widespread—Yet
Moore talked about how the changing business models in this experience economy require new and different systems. For example, with a subscription model, you have to know that customers are using your service, and analyze which features are popular and not, or they’ll lose interest and unsubscribe. “I need a different platform to play the next-generation game,” Moore said.
Cloud-based systems powered by AI and machine learning will be that next platform—what Moore calls “systems of intelligence.” The last wave of on-premises applications gave companies the “systems of record” they needed to accurately track finance, sales, manufacturing, supply chains, marketing, and HR, he explained. Then came “systems of engagement”—ecommerce, mobile apps, and interactive websites that let companies build new ties with customers. Systems of intelligence will combine big data, Internet of Things, and AI to give companies new and faster insights about customers and even the products they can offer.
“If you’re doing that now, you’re early,” Moore said. “You’re not radically early…but if you jumped on it now, you’re ahead of the herd.”
Left Coast Kratom is here to help you experience the freshest highest quality kratom powders and extracts at competitive prices.