Strategy before process
Before business process can be addressed, the organisation must have a very clear strategy in place, says ERP expert.
Strategy is critical to business success, and defining that strategy needs to come before process, says James A Robertson, enterprise resource planning (ERP) expert, author and owner of consultancy James A Robertson and Associates.
Before business process can be addressed, the organisation must have a very clear strategy in place, he says. "But in South Africa, the majority of organisations don't have a clear definition of their strategies. Part of the problem is that the word 'strategy' is often misunderstood - it is often used to describe a plan or way of doing things. But this is a strategic plan, not a strategy," he says.
During his years of research into the application of engineering principles to business strategy and IT investment success, Robertson investigated the definition of strategy, and aligned his thinking with the work of professor Malcolm McDonald, an international expert on marketing strategy, who defined strategy as "doing things right from the customer's perspective".
"This became the cornerstone of my thinking, and I took the approach that strategy is the essence of a business and what makes it thrive," says Robertson. "But even with this definition as a guide, many executives find it difficult to outline exactly what their strategy is."
Robertson says many companies get sidetracked with mission and vision statements, while others may think they are undergoing a strategic planning process; but if this is poorly facilitated, they are wasting their time, he says.
On the question of how companies can be sure their strategies are properly defined and are being effected, Robertson says: "If you are on track, your company will be profitable and growing."
Robertson believes strategy must be clear and refined before process can be addressed. "There needs to be an understanding of why strategy is so fundamentally important. Once strategic alignment has been achieved, companies can focus on process."
Illustrating the benefits of processes aligned to a clear and focused business strategy, Robertson highlights the case study involving African Sales Company (Asco), which implemented its ERP in line with its overall strategic approach to business, and realised substantial growth as a result.
Robertson says the company, which distributes premium fragrance brands in SA, was already strategically run, and wanted its ERP to serve as a 'strategic weapon'. The implementation was successful and helped drive business growth, because of its strategic alignment, says Roberston.
"In many cases, ERP implementations do not deliver on their promises, and executives are privately very disillusioned by them," he says.
Robertson will address the upcoming ITWeb BPM Summit on adopting a focused approach to strategic business improvement, as well as presenting the Asco case study together with the company's CEO, Robert Priebatsch. For more information about this event, click here.