I continue to encounter sub-optimal Integrated Business Information System implementations.  I sit through big brand and not so big brand system vendor and implementer presentations, sift through their marketing material and visit their websites.  The word "strategy" is scattered all over the place in absolutely inappropriate contexts.

If one reads the context of every place that the word "strategy" occurs, one must conclude that there is NO single, coherent, consistent, congruent definition of the word.  To some it is wheeling and dealing, to others it is a plan or a way of doing things, to others it is an important sounding word to impress people.  The result being that strategy is, in fact, a widely discounted word.  Very few people agree what strategy is, very few people know how to determine strategy, let alone do strategy, whatever that means.

When it comes to business software I am not sure that I have ever seen the word "strategy" used correctly.

What is "strategy"?

Back in 1990 I wrote a paper for a conference on the importance of aligning business information systems with strategy, and then found that I could not define strategy.  So I started to research the definition of strategy.

Professor Malcolm McDonald says "strategy is doing the right things, viewed from the perspective of the customer" and "tactics are doing things right, viewed from the perspective of the customer".  He goes on to say that if an organization "does the right things well, it will thrive".

Michel Robert defines "strategic driving force" and asserts that every organization has a single driving force that will seldom or never change.  If one gets in the way of that driving force, one will compromise and damage the organization.  If one enhances it, the organization will thrive.

Professor Michael Porter asserts that "differentiation" is the essence of strategy.

All three of these authorities significantly influenced my thinking to the point where I concluded that "strategy is the essence of the organization and how it thrives".  It is what is unique, that which differentiates the organization, what makes it stand out so that it attracts and retains customers.

It is that essential something that has brought the organization this far and will propel it into the future.  It is the right things that cause your customers to buy from you.  It is the fundamental element that if you damage it, you will destroy the organization and if you do it right the organization will thrive.  Strategic essence is unique to every organization.

Once you understand the concept of strategic essence, you begin to understand that this should be the reason you invest in new systems.  It should guide and direct the procurement and implementation of new systems and business improvement projects because the concept of the essence embraces the very core of what makes the organization successful.

This strategic essence originated intuitively from the founders recognizing a market need and filling it.  It embraces differentiation and competitiveness.  Organizations thrive because they are different and yet just about every systems implementation I have seen, just about every management consulting intervention, focuses on operational "me too" stuff and gets in the way of the essence and therefore the competitiveness of the organization.

As mentioned above, an essential element of strategic essence is differentiation -- that which enables the organization to compete and thrive.  Without differentiation we do not have customers.  When an organization cripples that which differentiates it, it loses customers, when it enhances it, refines it, takes it to the next level, customers flock through its doors.

The absence of understanding of these factors is what makes most integrated business information system projects frustrating to executives.

Understanding and applying strategic essence is the great opportunity for any organization embarking on a business improvement project today.  It is also the opportunity for any organization whose systems and operating procedures are slowing it down and getting in its way.

Introduce strategic essence thinking and methods into everything that you do, refocus your efforts and your investment and you will be surprised at what you can accomplish.

Fundamentally the strategic essence is different.

Strategic essence thinking is a total turnaround on traditional systems implementation thinking.

One of the things that floors me every time I come across it is why otherwise intelligent executives select business information system software on the basis of what their competitors are doing!

Exactly the same approach applies to appointing any firm of management consultants for any form of business "improvement" focus on the essence, lead from the front and do not abdicate to "IT" or anyone else.

An Integrated Business Information System implementation is probably the most far reaching business improvement project you will ever embark on.  Done right it can add huge strategic value.  Done wrong it can put you out of business.

The strategic essence of your organization should be comprehensively documented and communicated.  Every member of staff, right down to the person who cleans the corridors, should know the essence of the organization and how it affects their role.  In the early days you might go so far as to put up posters, put a banner on the wall facing the desk of ever executive and manager, talk about it constantly until it is totally known and totally understood.  Just doing that will improve the competitiveness, effectiveness and profitability of your organization.  That is if profit is your motive, IF you are a "not for profit" or a Government organization, the strategic essence is every bit as important in delivering whatever service it is that you deliver.

By now I hope that it is apparent to you that the strategic essence is the point of departure for every business improvement project.

If you cannot clearly define how a business system procurement, or much more mundane project will strengthen the essence of the business, do not do it!

Remember Malcolm McDonald's massively important definition "if you do the right things well your organization WILL thrive".  The essence IS the right things, operations is about doing the essence of the business very well indeed.

Make your people more effective in terms of the strategic essence of the business and the REST will FOLLOW!

Every step of the way, focus on the essence.

In every decision, ask yourself if you will be enhancing the essence.

Once you are focussed on the essence, sterile debates about what aspects of the business should be "BPR'd" fall away.  In fact, the whole concept of "Business Process Re-engineering" will fall away.

Incidentally, how do you "re-engineer" something that was not engineered in the first place?  I am an engineer and I have to say that I regard the whole concept of "Business Process Re-engineering" to be an entirely inappropriate use of the word "engineering"!

The essence is not about process or workflow, it is about doing the things that are central to the way the business works better and better and better and, IF there is workflow involved, optimize the workflow.  Note that the way to optimize workflow is not to spend thousands of Pounds / Dollars / Euros / ... on "as is" process mapping -- what a lovely way for consultants to make money and a total waste of client money!  "We are going to build a new bridge and demolish the old bridge so we will document the way the old bridge works in minute detail"

NO!

Focus on the essence!

By now I hope that you realise that choosing a business systems product on the basis of what your competitors are doing is a big mistake.

Choosing a system just because it is the "best of breed" for your industry is an even bigger mistake unless, of course, you are the defining player in your industry in which case you are clearly not doing the essence well.

The same applies to your choice of consultants and the type of business improvement projects you undertake.

Understand your essence and then go out and carefully head-hunt the firm that aligns with your essence, the firm with the essential cultural fit, the firm whose service promise aligns with your service promise, the firm that specializes in optimizing the products or services that constitute the essence of your business.

The above is a summary of a much more detailed article, please email me if you would like a copy of the full article.

I also have a video on strategic planning techniques, email me for the link.

I hope that I have challenged you to think differently about your organization and its systems.

I would welcome the opportunity to assist your organization to put any and all of the principles discussed in this article into practice in order to assist your organization to thrive.

I offer a one day intervention through to assist you to lift our the essence of your organization, please email me should you require information.  I also offer a comprehensive strategic planning service to engineering standards.

Yours faithfully,

Dr James A Robertson, PrEng

I continue to encounter sub-optimal Business Information System implementations.  I sit through big brand and not so big brand system vendor and implementer presentations, sift through their marketing material and visit their websites.  The word "strategy"  is scattered all over the place but frequently in absolutely inappropriate contexts.

If one reads the context of every place that the word"strategy" occurs, one must conclude that there is no single, coherent, consistent, congruent definition of the word.  To some it is wheeling and dealing, to others it is a plan or a way of doing things, to others it is an important sounding word to impress people.  The result being that strategy is, in fact, a widely discounted word.  Very few people agree what strategy is, very few people know how to determine strategy, let alone do strategy, whatever that means.

When it comes to business software I am not sure that I have ever seen the word "strategy" used correctly.  Michael Porter says that technology is never strategy, it is what people do with technology that is strategic!

What is "strategy"?

Back in 1990 I wrote a paper for a conference on the importance of aligning business information systems with strategy, and then found that I could not define strategy.  So I started to research the definition of strategy.

Professor Malcolm McDonald says "strategy is doing the right things, viewed from the perspective of the customer" and "tactics is doing things right, viewed from the perspective of the customer".  He goes on to say that if an organization "does the right things well, it will thrive", if it does them not so well, it will "survive" and if it does the wrong things, it will "die" it is simply a mater of how quickly.  The better the organization does the wrong things the faster it will die!  That definition has stuck with me and forms the basis of my corporate logo.

Michel Robert defines "strategic driving force"  and asserts that every organization has a single driving force that will seldom if ever change.  If one gets in the way of that driving force, one will compromise and damage the organization.  If one enhances it, the organization will thrive.

Professor Michael Porter asserts that "differentiation" is the " essence" of strategy.

All three of these authorities significantly influenced my thinking to the point where I concluded that"strategy is the essence of the organization and how it thrives".  It is what is unique, that which differentiates the organization, what makes it stand out so that it attracts and retains customers.

It is that essential something that has brought the organization this far and will propel it into the future.  It is the right things that cause your customers to buy from you.  It is the fundamental element that, if you damage it, you will destroy the organization and if you do it right the organization will thrive.

Strategic Essence is unique to every organization.

The interesting thing about this definition is that when I interview an executive team, individually, one on one, and ask "what is your strategy?" frequently their replies are all over the place.

When I ask them "what is the essence of your organization and how does it thrive?" they frown, they think, they scratch their heads, but, eventually, after thinking aloud, the final result of the individual interviews will generally be a fairly consistent view of the Strategic Essence of their organization.

Once you understand the concept of Strategic Essence, you begin to understand that this should be the reason you invest in new systems.  It should guide and direct the procurement and implementation of new systems and business improvement projects because the concept of the essence embraces the very core of what makes the organization successful.

This Strategic Essence originated intuitively from the founders recognizing a market need and filling it.  It embraces differentiation and competitiveness.  Organizations thrive because they are different and yet most systems implementations, focuses on operational "me too" stuff and gets in the way of the essence and therefore the competitiveness of the organization.

Some years ago I undertook a short diagnostic investigation, something that I call a "Pulse Measurement", into a systems implementation that had been stalled for nearly a year.  The client was in the Freight Forwarding and Clearing business, and they were in the process of implementing a "best of breed", "industry leader" software package -- the "obvious" choice.

I interviewed the executive team, one on one and, by the end of the first day I had established that their market was the 10% of customers who were very time sensitive, and that they had differentiated themselves with very tight response times and a service promise which amounted to "if we promise you delivery by a certain date and time and the clearance is delayed we will make good your loss".  They never had to make a payment and they had a portfolio of very satisfied and very loyal customers.

There was major tension with the software company which was also managing the implementation.  The second day of the investigation I phoned the owner of the software firm in another country and quickly established that his Strategic Essence was to be the dominant software provider in the field globally, which meant, of necessity, that he was focussed on the 90% of the market where service levels and response times were not such an issue.

There was a fundamental strategic misalignment.  I met with the executive who had briefed me and explained what I had discovered.  He took one look at me and exclaimed "of course! the lights have just gone on!"  That single discovery fully explained the tensions, the frustration, the lack of commitment to service, the entire "sorry saga" of a project that had run for eighteen months and caused nothing but heartache and frustration.

That is the power of understanding the Strategic Essence of an organization.  On the strength of that one piece of information, which delivered a massive "AHA" to the man in charge, the project was summarily terminated the same day!

I was then engaged to assist the client to select the most suitable software.  Together with my client, we visited three software companies.  At the third presentation the chief executive of the small niche player, unprompted, said "we are committed to service, in fact, we are so committed to service that if you miss a deadline as a consequence of a problem with our software we will reimburse you your losses".

I am sure you can understand that no further evaluation of software was necessary, at that presentation we ascertained that the software met the basic needs of the business but much more importantly, we had found a supplier whose strategic focus was strongly aligned with that of my client.  The software went in without difficulty.

It is not always that simple but failing to ensure alignment at the level of the Strategic Essence will alwaysgive rise to problems, and alignment with the Strategic Essence will always greatly improve the probability of a successful outcome.

4. Differentiation

5. The essence IS different

6. The essence should be comprehensively communicated

7. The essence should be the point of departure for every project

8. Enhancing the essence should be the focus of every project

9. One size fits all cannot work

I hope that this article has provided a different perspective on the relationship between systems and strategy.

I would welcome the opportunity to assist your organization to put the principles discussed in this article into practice to assist your organization to thrive.

The above is an extract from a longer article which you will receive in installments. Please email me if you would like the full article immediately.

I offer a one day intervention through a series of one hour interviews with your management team to assist you to lift out the essence of your organization, please email me should you require information.

I also offer a comprehensive strategic planning service to engineering standards.

Yours faithfully,

Dr James A Robertson, PrEng

If one reads the context of every place that the word "strategy" occurs, one must conclude that there is no single, coherent, consistent, congruent definition of the word (see previous issue).

When it comes to business software (including ERP) I am not sure that I have ever seen the word "strategy" used correctly.

What is "strategy"?

Following much research I concluded that "strategy is the essence of the organization and how it thrives" (see previous article).  If you do it right the organization will thrive (Malcolm McDonald).  Strategic essence is unique to every organization.

It is not always that simple but failing to ensure alignment at the level of the strategic essence will always give rise to problems, and alignment with the strategic essence will always greatly improve the probability of a successful outcome.  There are additional factors but that is for another day.

As mentioned above, an essential element of strategic essence is differentiation -- that which enables the organization to compete and thrive.

Without differentiation we do not have customers.  When an organization cripples that which differentiates it, it loses customers.  When it enhances it, refines it, takes it to the next level, customers flock through its doors.

An example: a stalled project, ERP plus Warehouse Management System.  Customer was also involved in Brand Management for a range of global brands and, in fact, its ability to manage and enhance those brands, was the reason it was successful.  Yes, it was good at distribution but that was not the essence.  The stalled project totally ignored brand management and focused on the warehouse.

I developed a Product Classification for the ERP that focussed on the brands, right down to what we called the "brand line", the specific component of the brand that groups distinct elements of what you find on the retailers shelf.  I then designed some software to use the intelligence in the Product Classification to facilitate new product take-on so that the Master Data was highly intelligent and of the highest possible quality.

I also added a range of customer specific custom strategic attributes to the Product Master File that uniquely classified the products in accordance with the way my client and their customers viewed the products from a marketing perspective.

I then specified a further piece of custom software that provided functionality to auto-generate marketing projects into the Projects module of the ERP based on the Product Classification (i.e. the Brand Hierarchy).

The client now had a project per brand line coded in such a way that they rolled up per brand and supplier with a budget and actual cost bin per brand line, per month across 29 marketing cost lines.

Overnight the client went from massive manual analysis in clumsy and unreliable spreadsheets with double punching to a comprehensive suite of brand management reports that NONE of their competitors were able to match anywhere on the planet.

Within a couple of years their turnover was up significantly and they won one of the most prestigious brands in the world away from their competitors; because they could do something their competitors could NOT do. Read case study.

At this point the cost of the project became insignificant relative to the improved turnover and profitability that resulted -- they could do more, better and with the same headcount!

That is the power of strategic essence.

Yes, there were months of grunt work using specialized techniques to make it all work, but if you start out on the wrong road it is all fruitless; and most business systems projects do start off on the wrong road!

The absence of understanding of these factors is what makes most business system and ERP projects frustrating to executives.

Understanding and applying strategic essence is the great opportunity for any organization embarking on a business systems project today.  It is also the opportunity for any organization whose systems and operating procedures are slowing it down and getting in its way.  Small adjustments relating to some of the points raised above can give rise to a very substantial improvement.

Introduce strategic essence thinking and methods into everything that you do, refocus your efforts and your investment and you will be surprised at what you can accomplish.

5. The essence IS different

6. The essence should be comprehensively communicated

7. The essence should be the point of departure for every project

8. Enhancing the essence should be the focus of every project

9. One size fits all cannot work

I hope that I have challenged you to think differently about your organization and its systems.

I would welcome the opportunity to assist your organization to put any and all of the principles discussed in this article into practice to assist your organization to thrive.

The above is an extract from a much more detailed article, please email me if you would like a copy of the full article.

I offer a short duration light touch intervention through a series of one hour interviews with your management team to assist you to lift out the essence of your organization.  Please email me should you require information.  I also offer a comprehensive strategic planning service to engineering standards.

Yours faithfully,

Dr James A Robertson, PrEng

Previous articles in this thread have discussed the lack of clarity with regard to the term strategy and proposed that strategy is "the essence of why an organization exists and how it thrives".  This definition is based on the work of Professor Malcolm McDonald .

This definition has been extended through to the importance of differentiation.  A number of examples were used to demonstrate how the use of strategic essence thinking can unblock stalled business system projects.  This same approach can turn systems projects from mundane operational overheads into truly strategic resources.

This article highlights the importance of viewing any significant business systems investment as fundamentally strategic and driving it from a strategic executive business perspective.  This is tied into criteria to use in appointing system consultants and implementers.

Fundamentally the strategic essence IS different.

Strategic essence thinking is a total turnaround on traditional systems implementation thinking.

One of the things that floors me every time I come across it is why otherwise intelligent executives select business information system software on the basis of what their competitors are doing!

The reason they are your competitors is because you are doing something differently to them!  Yet now you choose the same system and same implementer they are using, on the grounds that they are in the same industry!  And then you complain that your system is getting in your way?   Most executives also leave the selection of their new system, a critical strategic decision, to their mid-level management or even the CIO or IT Manager, and then are surprised when they get no meaningful strategic information.

Determine the essence of your business and how it thrives.  Translate this into a strategic requirements definition and go to the market looking for the product and implementer that most clearly evidence an intuitive understanding of your strategic essence, and can explain how they will enhance it.  Find a strategic fit, go through a robust procurement and contracting process  and sign a solid and enforceable contract.  And appoint an independent strategic advisor to look after your interests, and serve as your proxy for day to day project decisions.  Somebody who intuitively understands the essence of your business and the technology.  Someone who can advise you objectively and effectively and is entirely aligned with your interests.

Exactly the same approach applies to appointing any firm of management consultants for any form of business "improvement" -- focus on the essence, lead from the front and do not abdicate to "IT" or anyone else.

An Integrated Business Information System is, almost certainly the most far reaching business improvement project you will ever embark on, if undertaken correctly.  Done right it can add huge strategic value.  Done wrong it can put you out of business.

Since the CEO is the custodian of the integrated view of the business, (that is after all what the executive team is - the integrated view of the business) the custody of the integrated business information systems should rest with the CEO.  Back the CEO up with whatever strategic and operational advisory support he or she requires.  Put the CEO firmly in charge of the system from the top table.  Reposition your IT Manager as "Head of Business Systems".  Do whatever it takes to support the CEO to champion and drive the operation of your integrated business systems from a strategic essence perspective.  Failure to do this is the biggest single reason why businesses fail to get strategic value from their business information systems.  And why integrated business systems are seldom implemented as integrated systems. Click here for a video on Executive Custody .

The strategic essence of your organization should be comprehensively documented and communicated.  Every member of staff, right down to the person who cleans the corridors, should know the essence of the organization and how it affects their role.  In the early days you might go so far as to put up posters, put a banner on the wall facing the desk of every executive and manager, talk about it constantly until it is totally known and totally understood.  Just doing that will improve the competitiveness, effectiveness and profitability of your organization.  That is IF profit is your motive, IF you are a "not for profit" or a Government organization, the strategic essence is every bit as important in delivering whatever service it is that you deliver.

The view of any person and particularly any business systems implementer or management consultant, is framed by their first hour of contact with the organization.  That is why I insist on interviewing the CEO first, one on one for an hour.  It is also why I do not interrogate their website before I meet them (I do not want some mid-level persons' view of the business first).

My first question is "what is the essence of your organization and how does it thrive?" and "how does it differentiate itself and compete".  And then another two or three standard critical questions that I have honed over the years.  Together these questions will take the CEO and every other executive individually a full hour to answer.  And, if given the opportunity, they will overrun that hour.  I active listen, (feedback) and take lots of notes.  By the end of that first hour I know more about the heart of the organization than other consultants who have been working with the client for months.  In many cases I find that at the end of this strategic discovery I understand more about what is really important to the client than other consultants ever understand!

That insight allows me to quickly and accurately interrogate why systems are not delivering, diagnose the root cause of the problems, and prescribe the solutions.  Because when it comes to business systems, the root cause of poor system performance is almost never technology or anything under the control of technologists.  Organizations are organic, they are made up of people and it is generally the "people" issues that cripple systems.  So, giving the project to hard issue people who do not understand the soft issues, is a massive mistake.  Yes, you need the people who understand the bits and the bytes, but they need a translator to tell them what to do in order to align the bits and bytes with the essence of the business.

By extension, the next time you interview for the executive team, tell them your essence and ask them to describe on the basis of their experience how they can help you enhance it.  When you next evaluate competing management consultancies, do the same.  When you are shopping for new business systems, be it the full business suite or simply some additional component, do the same and evaluate the competing offers against your essence.  Pick the vendor / implementer with the people who demonstrate intuitive understanding for the essence, and then lock them in contractually for the duration of the project.

Do not allow bidders to wheel in the strategically intuitive mastermind for the pre-sales meetings, and then send that person off in search of the next trophy as soon as you have signed the deal.  Lock that man or woman into the project contractually and prohibit the bidder from introducing anyone to the bidding process who will not be part of the project team.  Orientate them to the essence, and then make sure that they evidence deep intuitive ability to enhance and support the essence.

7. The essence should be the point of departure for every business systems project

8. Enhancing the essence should be the focus of every project

9. One size fits all cannot work

I hope that I have challenged you to think differently about your organization and its systems.

The full article from which the above is extracted is available on my website .

I would welcome the opportunity to assist your organization to put any and all of the principles discussed in this article into practice to assist your organization to thrive.

I offer a one day intervention through a series of one hour interviews with your management team to assist you to lift our the essence of your organization , please email me should you require information.  I also offer a comprehensive strategic planning service to engineering standards.

Yours faithfully,

Dr James Robertson PrEng

Strategic Essence -- The Missing Link in Business Information Systems
A discussion of how strategic essence should inform all business improvement projects and particularly business information system projects.  This thread is intended to discuss the analysis of strategy, the planning of strategy and feeding strategy through into business system specifications and the management of projects.  Articles to date include:

Summary
Part 1: Strategy Defined
Part 2: Differentiation
Determining Strategic Essence

The Real Issues in Business Systems
A discussion as to why business information system (and other business improvement projects) fail to deliver on expectations or fail outright together with discussion of the critical factors that must be taken into account in order to achieve successful outcomes.  This thread is intended to progressively discuss more hand's on specifics of achieving high value outcomes and builds on the Strategic Essence series.  Articles to date include:

Introduction

Strategically Enriching your Business Systems
Discussion of practical specific measures that can be taken in order to greatly improve the information yield of business information systems at both the operational and executive strategic level.  A number of simple steps that can be taken immediately and more complex measures that can be taken over time.  This thread is intended to discuss increasing business system and data warehouse value yield using techniques that lead to significantly improved business intelligence capability including support for the ability to "obtain answers to questions we had not previously thought to ask".  This builds on the content in the Strategic Essence and Real Issues threads.  Articles to date include:

Introduction

Robust Business Systems Procurement
In order to fully apply the methods and principles discussed in the threads above with regard to new systems it is vital that a robust and effective approach to procurement is applied.  This requires a tough procurement approach directed at achieving a tough business outcomes orientated project that ensures a high value outcome.  This thread is intended to discuss the components of such a procurement approach including the individual documents and process that make up the approach.  Thereafter the components will be discussed in more detail.  Articles to date include:

Introduction Part 1

Previous articles in this thread have discussed the lack of clarity with regard to the term strategy and proposed that strategy is "the essence of why an organization exists and how it thrives".  This definition is based on the work of Professor Malcolm McDonald

This definition has been extended through to the importance of differentiation.  A number of examples were used to demonstrate how the use of strategic essence thinking can unblock stalled business system projects.  This same approach can turn systems projects from mundane operational overheads into truly strategic resources.

The previous article highlights the importance of viewing any significant business systems investment as fundamentally strategic and driving it from a strategic executive business perspective.  This is tied into criteria to use in appointing system consultants and implementers.

This article stresses the importance of focussing on the strategic essence as the point of departure for every business systems project and, thereafter, focussing on the essence throughout the project.  From this it becomes apparent that a generic approach to system selection and implementation cannot work.

By now I hope that it is apparent to you that the strategic essence is the point of departure for every project.

If you cannot clearly define how a business systems procurement, or much more mundane project will strengthen the essence of the business, do not do it!

"But operations",  I hear you cry.

Surely operations are an essential component of the essence of the business?

Remember Malcolm McDonald's massively important definition "if you do the right things well your organization WILL thrive".  The essence IS the right things, operations is about doing the essence of the business very well indeed.

The moment you allow yourself to be seduced into believing that you can do operational things without reference to the strategic essence of the business, then either your definition and understanding of the true essence is fatally flawed, or you are way off the mark with what you are doing!

The reason that virtually every business systems project, be it ERP, warehouse, etc project on the planet fails to support the business to thrive; and the reason that 98% of CEO's are disappointed with / frustrated with / off-the-record-angry with their business system and its implementers and operators, is because the project was undertaken with NO reference to the essence and the system gets in the way of the essence.  The expectations of just about every executive are numbed out with regard to their systems because of all the ... they have been sold and told.

Process obsession is the single biggest perversion and obstructor of strategy on the planet today.  Process obsession is a management consultant's money printing dream.  Process obsession majors on the minors and totally ignores the strategic essence of the business.   Process obsession encourages and enables mid-level operational consultants to facilitate mid-level operational people for days and days and days to get totally in the way of the strategic essence of the business.  When process obsession projects fail it is always the clients fault (fundamental management consulting commercial principle)!

When you focus on the essence and enhance the essence, then workflow will be optimized as an executive directed output of the project, a spin-off, a side output because the essence and equipping and empowering people to enhance the essence is the issue.

Want to reduce the cost of running your ERP?  Focus on the essence!

ERP NOT properly integrated?  Focus on the essence!

Too much dead wood?  Focus on the essence!  Double your turnover and headcount is no longer an issue!

One of the first projects that I ever did focussing on strategic decision support delivered exceptional executive information and operational performance management, totally unplanned, also delivered a 75% reduction in audit costs and a 25% reduction in administrative staff costs.

Make your people more effective in terms of the strategic essence of the business and the rest will follow!

Every step of the way, focus on the essence.

In every decision, ask yourself if you will be enhancing the essence.

Once you are focussed on the essence, sterile debates about what aspects of the business should be "BPR'd" fall away.  In fact, the whole concept of "Business Process Re-engineering" will fall away.

Why do 70% of BPR projects fail outright?

Because they should NOT have been undertaken in the first place!

Why do another 20% of BPR projects materially fail to meet management expectations?

Because they should also not have been undertaken in the first place.

Incidentally, how do you "re-engineer" something that was NOT engineered in the first place?  I am an engineer and I have to say that I regard the whole concept of "Business Process Re-engineering" to be an entirely inappropriate use of the word "engineering"!

The essence is NOT about process, it is about doing the things that are central to the way the business works better and better and better and, IF there is workflow involved optimize the workflow.  Note that the way to optimize workflow is NOT to spend thousands of Pounds / Dollars / Euros / ... on "as is" process mapping -- what a lovely way for consultants to make money and a total waste of client money!  "We are going to build a new bridge and demolish the old bridge so we will document the way the old bridge works in minute detail"

NO!

Focus on the essence!

Optimize in support of the essence!

"Lean operations"? -- focus on the essence!

Focus the entire organization on getting exceptionally good at doing the essence of the business and it will thrive.

Focus the existing systems on enhancing the essence.  Reconfigure where necessary.  Add a data warehouse together with strategic taxonomies that focus on the essence and redefine your strategic management information.

Add every conceivable attribute to your databases that relates to the essence of the business.  Add essential strategic attributes onto every master file: your products, your people, your customers, your suppliers, your ...

Seek to get to the place where your business systems and accompanying data warehouse can answer every question you can reasonably expect them to answer.  including answers to the questions you have NOT yet thought to ask!

If you focus on the essence you will find that things flow easier, faster, more efficiently and more effectively.

If you focus on the essence you will find that the latest techno hype from major software and hardware vendors is no longer strategic.  In fact you will wonder why you ever paid any attention to their hype at all.

You will quite likely find that your five year / ten year / ... year old system IS capable of growing with your business and you will find ways to add clever pieces of software that enhance the essence around the core databases.  You will realize that the major ERP and business system products are massively undifferentiated and that it really does not matter which product you have or buy.  A customer record is exactly the same no matter what software and database you are using!  It does matter who advises you and how intuitively they understand the essence of our business and what niche specialty software you purchase.

One senior consultant part time who deeply grasps the essence of your business will add a thousand times more value than an army of the other kind.

By now I hope that you realise that choosing a business systems product on the basis of what your competitors are doing is a big mistake.

Choosing a system just because it is the "best of breed" (whatever that means) for your industry is an even bigger mistake unless, of course, you are the defining player in your industry in which case you are clearly NOT doing the essence well because, if you were, by now you should have taken over all the rest of them!

The same applies to your choice of consultants and the type of business improvement projects you undertake.

Understand your essence and then go out and carefully head-hunt the firm that aligns with your essence, the firm with the essential cultural fit, the firm whose service promise aligns with your service promise, the firm that specializes in optimizing the products or services that constitute the essence of your business.

I hope that I have challenged you to think differently about your organization and its systems.

I have spent the last 30 plus years learning about strategic essence and how to incorporate it into business system configuration and operation with leading edge concepts and proven methods to engineering levels of rigour.   I have also developed a highly effective, light touch, short duration "Pulse Measurement" based on Military Quick Attack techniques to determine the health of your systems and prescribe the treatment to fix them.

I would welcome the opportunity to assist your organization to put any and all of the principles discussed in this article into practice to assist your organization to THRIVE, commencing with a Pulse Measurement at a minimal cost compared to the value that you will derive from it (I offer a no gain no pay guarantee).

Yours faithfully,

Dr James Robertson PrEng

It is one thing to write about Strategic Essence.  It is another to accurately identify it.

The interesting thing about Strategic Essence is that many times it is not known or is misdiagnosed.

"A huge mismatch." That's how University of Chicago Graduate Business School Professor James Schrager describes the 1998 merger of Daimler and Chrysler (DCX). Schrager, president of Great Lakes Group, a South Bend (Ind.) strategic consultancy, is an active consultant to a variety of auto-centric companies.

Schrager, who was named by BusinessWeek in 2000 as one of the top teachers in the University of Chicago's business program, recently spoke by phone with Special Correspondent Ann Therese Palmer about the strategic problems newly announced DaimlerChrysler CEO Dieter Zetsche faces, with Jurgen Schrempp stepping down on Dec. 31 (see BW, 08/15/05, "Dark Days at Daimler").

Edited excerpts of their conversation follow:

Q: Why were Schrempp's deals a mistake?

A: They were a mistake because the strategies - for Mercedes and Chrysler and all of its associated brands -- were so different. For years, Mercedes' car brand sat at the top of the world as far as prestige, durabilty, and reliability. Starting in the mid-1970s through the mid-'90s, with the iconic 450-series, it was the ultimate car brand. It was the finest-engineered car you could buy.

Contrast this with Chrysler. During the same period, it was constantly looking for what rabbit it needed to pull out of its hat to stay alive. Were it not for the minivan, introduced in 1982, Chrysler would have been gone sometime in the 1980s. Schrempp has done a great deal of damage to a company that had a rock-solid reputation by cobbling it together with a company that slithers from crisis to crisis. We have a huge mismatch here.

Bloomberg Businessweek Magazine

The failed marriage of Daimler Benz and Chrysler, is a classic example of massive damage caused by ignoring strategic essence.  Daimler Benz (Mercedes) has a driver of technical excellence, Chrysler has a driver of technical innovation.

Mercedes also innovates and they both make motor vehicles so it looked like a logical match.  In fact these differences in Strategic Essence were fundamental pointers to the failure of the merger long before it started.

Thus we have the interesting paradox, the executives of an organization, the custodians of the strategic essence, often do not know what the Strategic Essence is.

As an organization matures and new executives are recruited they frequently ignore the Strategic Essence, or misdiagnose it or do not even know it exists.  The decline of many once successful organizations and even nations, can be attributed to decisions that cut across or undermine the strategic essence.

Since Strategic Essence is frequently an intuitive consequence of organizational founders accurately reading a market need and then meeting it - Strategic Essence is not necessarily ever made explicit.

Even when the Strategic Essence has been made explicit, many modern managers who have been raised in an environment that suggests that strategy is invented and can be re-invented at whim, think nothing of changing course.  This, despite a robust body of knowledge which evidences that the strategic essence of an organization should be clearly defined and then refined with focus and more focus and more focus -- the strategic essence virtually NEVER changes.

The client was a highly successful specialist freight forwarding and clearing company with a market share of around 10%.

They had carved a niche for themselves with a service promise which could be summarized as "if we mess up and the clearing of your shipment is delayed for ANY reason, we will make good your loss NO questions asked".

I was called in to advise them with regard to a business systems project that had been stalled for a year.

As I interviewed the executive team I asked my standard questions in order to determine the strategic essence of the business, and lifted out the service promise stated above.  I also asked questions to understand the problems with the project.

The answers with regard to the service promise all focussed on exactly the same statement of excellence.  The answers with regard to the project all related to sloppy and poor service from the implementers, things that did NOT work the way they should, etc.

I then interviewed the owner of the software company, based halfway around the globe, his strategic goal was to become the biggest software company servicing my client's market, in other words his goal was to service the 90% of my client's market that did NOT offer such an extreme service promise.

There was a fundamental strategic misfit.  The client wanted quality, the supplier wanted quantity and was NOT concerned about quality.

At the end of the second day of my investigation I sat with the sponsoring executive and outlined my findings.  "The lights have just gone on!" he exclaimed, "now it all makes perfect sense!"

The next morning he cancelled the project and we set about interviewing other software providers.

The third software provider that we interviewed started his presentation by saying "we are committed to service excellence, if our software ever causes you to be late on your service promise we will make good your loss, NO questions asked!" it was clear that THIS was the correct software company.

This is an example of how strategic essence is critical in making a software or system buying decision. In fact, it is far more important than software functionality and all the other hype that generally confuses executives and results in inappropriate buying decisions.

This article outlines the method that I use to determine strategic essence in an interview situation as part of my routine investigations into failed and sub-optimal business information systems projects and also use at the commencement of any project to assist a client to procure a new system

When things are going badly, return to the essence.

But what if we never consciously defined the Strategic Essence?

Or if the old guard have left and we no longer know it?

Strategic essence leaves its fingerprints and tell-tale signature ALL over the organization, you just need to know where to look for it.

This article discusses the method that I have evolved for determining strategic essence and which I use consistently when I commence a new engagement of any sort and which you can apply in your organization with an appropriate facilitator:

Appoint an experienced strategic facilitator, the less they know about your organization the better.

This person should be research oriented with good listening and good analytical skills and a thorough understanding of strategy.

Using an internal facilitator you run the risk of their judgment being clouded by what they know or think they know.  Always remember that the executives of Daimler Benz got it wrong.

You need to find a facilitator who has not worked with your organization before.

The facilitator should be mature, experienced, worked with diverse organizations in diverse industries with diverse strategic drivers.  In fact, probably at least in their fifties if not older.  You are looking for the maturity and depth of experience that will allow them to hear the heartbeat of the organization and facilitate to achieve clarity.

Have the facilitator interview each executive starting with the Chairman, when applicable, and then the Chief Executive Officer, followed by the rest of the executive team.  If the executive team have only recently joined the organization and the organization is mature it may be desirable to interview retired executives.  If the founder and founding management team are retired but still available it is advisable to interview them.

I recommend a one hour one-on-one interview with each person selected, typically between five and ten people in total.

I also recommend that the people being interviewed are not prepped for the interview in order to avoid discussions that can skew the result.  Ideally the interviewees should hear the questions for the first time in the interview.

"Please will you tell me the essence of this organization and how it thrives? is the fundamental question.  It may be necessary to ask supplementary questions such as "how does the organization differentiate itself from its competitors?",  "how has the organization grown to its present size?", etc.

It is vital that the person conducting the interview understands the question, understands strategy and understands strategic essence so that they can facilitate the interview effectively.

If this process is being embarked on as part of an exercise to diagnose some aspect of the business that is NOT functioning as expected, such as a failed or sub-optimal business information system implementation; or in preparation for embarking on a new business information system acquisition and implementation; then questions relating to this component can follow the strategic essence questions.

It is vital that the person conducting the interview listens intently and active listens.  This assists the person being interviewed to dig deep and, in many cases they DO need to dig deep.  In some cases the answer may be immediately apparent to the person being interviewed, but frequently I find that they need to scratch their heads and think deeply and test these thoughts.

By "active listen" I mean the technique of feeding back to the person being interviewed what the person conducting the interview understands them to be saying -- " I am hearing you say that ... ".

In my experience this point is central to achieving a quality outcome.  I have found that most people share more and dig deeper when the person conducting the interview is taking detailed notes.  It is almost paradoxical, but, in reality, most executives will disclose more and dig deeper when they have the experience that they are being "heard" and that the person conducting the interview regards what they have said as being sufficiently important to take notes.  Taking notes is also a sign of respect towards the person being interviewed.

I have had executives disclose the most remarkable things in this type of interview while I am taking copious notes.

Clearly there must be trust and most organizations will require the person conducting the interview to sign a non-disclosure and confidentiality agreement.  The notes should not be shared with anyone except the interviewer and the interviewee and should remain in the custody of the person who conducted the interviews, or be destroyed once the strategic essence has been fully documented and agreed to.

In some cases, as alluded to above, it may prove necessary to interview other people, long serving staff members, retired directors, founders, etc.  The goal is to obtain an accurate and reliable definition of the strategic essence together with appropriate elaboration.   In many cases, by the end of the fourth or fifth interview a clear pattern starts to emerge and by the time the entire top team have been interviewed there is frequently complete certainty as to what the strategic essence is.

In contrast, in the case of an organization that has been in existence for many years and is currently not achieving its historic levels of performance, it may be necessary to undertake deeper research to get to the roots of the strategic essence.

The person who conducted the interviews must then, based on a clear analysis of all the interviews, formulate a concise statement of the strategic essence and any associated elaboration.

This may be supported by additional comments and observations but these are discretionary.

The fundamental goal of this engagement is a concise statement of "the essence of the organization and how it thrives".  The rest is secondary and can be elaborated on in time.

If an executive differs with the CEO then, unless the CEO has just arrived, the CEO's view should receive particular attention, particularly if the CEO is the founder or has been there for many years.

If the CEO or any executive has only recently joined the organization it is possible that they will be far off the mark.  Quite frequently new executives bring a worldview that is based on past experience and attempt to force-fit it to the new organization.

This will seldom if ever work and can be extremely dangerous.

In other cases new executives who have done their homework may have a better sense of the Strategic Essence than other longer serving executives.

There is no absolute rule.

Once the interviewer has produced a final outcome this should be tabled to the Chief Executive or Chairman and other senior executives for review and refinement.

Frequently, as in the example above, there is an "Aha!" moment when the finding is disclosed.

Refer to the previous articles on Strategic Essence for some suggestions on applying Strategic Essence.

I offer a concise light touch intervention based on the method outlined above which I have been applying successfully for over a decade and which is a refinement of a method that I have applied for over two decades.

Click here to email me for more information.

Yours faithfully,

Dr James Robertson PrEng

A discussion of how strategic essence should inform ALL business improvement projects and particularly business information system projects.  This thread discusses the analysis of strategy, the planning of strategy and feeding strategy through into business system specifications and the management of business improvement projects.  Articles to date include:

Summary
1: Strategy Defined
2: Differentiation
3: The Essence IS Different
4: Strategic Essence is the Point of Departure
5: Determining Strategic Essence

A discussion as to why business information systems fail to deliver on expectations or fail outright.  Coupled to discussion of the Critical Factors that must be taken into account in order to achieve successful outcomes.  This thread is progressively discussing more hands-on specifics of achieving high value outcomes and builds on the Strategic Essence series.  Articles to date include:

1: Introduction
2: Mythology and Lack of Executive Custody
3: Lack of Strategic Alignment and Lack of Precision Configuration

Discussion of practical specific measures that can be taken in order to greatly improve the information yield of business information systems at both the operational and executive strategic level.  A number of simple steps that can be taken immediately and more complex measures that can be taken over time. 

This thread is discussing increasing business system and data warehouse value yield using techniques that lead to significantly improved business intelligence capability, including support for the ability to "obtain answers to questions we had not previously thought to ask ".  This builds on the content in the Strategic Essence and Real Issues threads.  Articles to date include:

1: Introduction
2: Principles of Data Engineering
3: Steps in Applying these Recommendations

In order to fully apply the methods and principles discussed in the threads above with regard to new systems it is vital that a robust and effective approach to procurement is applied.  This requires a tough procurement approach directed at achieving a tough business outcomes orientated project that ensures a high value outcome.

This thread discusses the components of such a procurement approach.  The individual documents and processes that make up the approach are outlined.  Thereafter the components are discussed in more detail.  Articles to date include:

1: Introduction
2: Bill of Services, Laboratory, Go-live Certificate, etc
3: Executive Engagement, Bid Compliance, Adjudication and other matters

To inquire about ordering the above service simply click on the link, enter your details in the resulting email and send it to me.  If for some reason the email does not open please just hit reply to this email and enter your contact details.  I will revert to you in the manner you request to answer your questions and make arrangements.

Should you require further information please email me and I will be delighted to connect by email, phone or Skype to answer all your questions.

I look forward to being of service to you.

Yours faithfully,

Dr James Robertson  PrEng