Jason Abrahamson

When I started in IT ten years ago it was a very different place than it is today. Windows 98 was bleeding edge for consumers and Windows 2000 was nipping at its heels. I cut my teeth on NT 4.0 PDC/BDC to Active Directory migrations and ridding companies of the infamous Exchange 5.5. Datacenters were vast with expensive cooling and payroll was sky high for the best and the brightest trained IT people.

Today the picture is much different. At some point in the last ten years IT became “broke.” Who is to blame for this? IT staff? Corporate? Whatever the reason, it’s broke, so let’s look at how it’s broken and what we can do to fix it:

Problem: Cost
Everything else in the world has gone down in price, but IT keeps going up. The real cost isn’t in hardware and software though. You can buy a desktop computer for less than $500 now. The costs that continue to go up are datacenter, bandwidth, and energy. Management is constantly fighting the battle of putting in more servers, more bandwidth and more power. Some of these issues have been addressed with blade technology and virtualization, but they’re still a far cry from being in line with what they need to be. If that’s not bad enough, labor costs continue to go up while maintaining onsite IT staff.

Problem: Complexity
Networks have not gotten easier to manage but harder. IT staffs are consumed with trying to keep up and learn the latest networking protocols to keep with demand of the network. Everything runs over the network now and it’s just going to get worse before it gets better.

Problem: Lifespan
With manufacturing or distribution you get a lifespan of nearly twenty years on your equipment. That is a tremendous ROI! In IT you don’t get nearly that. What you put in today will be outdated within 3 years and at capacity within 5 years.

So how can a business compensate for this?

Solution: Cloud Computing & Outsourcing
Cloud computing is not a pipe dream anymore. Depending on your business model, your company might easily adapt to cloud computing, managed server solutions, or SaaS. You tremendously cut down on overhead by reducing payroll demands, capital expenditures for hardware, and reoccurring costs of energy, and bandwidth. With the cloud computing or managed server solutions you are essentially making your service provider responsible for dealing with the ongoing costs of running a datacenter. That’s ok though, because chances are your service provider is better at it than you anyway. That’s why they’re in the business.

Every organization of which I have been a member fights the constant war: IT vs The Company. Far too often companies are faced with the challenges of growing the IT infrastructure to meet the business requirements while staying on track and under budget. Each organization fights this war in a different way. Some organizations fight against IT, others allow IT to dictate the rules of engagement. No matter how your organization handles IT, you can bridge all gaps with one simple thing: Communication.

There are things on which IT doesn’t need to communicate with others– like why they can’t put their kid’s picture as their background, flower themed letterhead in Outlook, or the requirement to set a strong password. All these things are very important to IT, but they’re not important to the rest of the organization. Things that need to be explained to users though, and department heads, is how each system integrates into another. More often than not users will get along without knowing how the AD Forecasting application ties into Inventory Control. Generally, users take these systems for granted. Since this does happen, it’s the job of the IT Management team to make themselves more aware of the growing needs of the business.

With the implementation of Cloud Computing and SaaS, IT is no longer just knowing how Active Directory or the seven layers of the OSI model work. We need to educate ourselves and embrace dialogue with colleagues about what the needs of the company are. This is crucial in our daily pursuit to protect the company from the outside, as well as itself. IT managers that schmooze with other department heads can help steer the course of technology within the organization.

You will have to seek out this dialogue because far too often IT is looked upon as nothing more than a black hole. It is viewed as a department who has ballooning expenses with not a lot of measureable equitable return. On the other side, IT views most of the organization as non-understanding to the demands and security needs of the organization. These are complicated issues, but they can be overcome. Here are some ways to do so:

1) Engage department heads; Open dialogue. I used to invite other managers to lunch and have off the record brainstorming sessions. This is a great way to make allies and transfer knowledge. It’s a good way for you to be candid with each other and freely discuss any issues.

2) Evaluate and propose. Evaluate the current infrastructure and needs of your business. If you are in the distribution business, is your technology infrastructure supporting that division adequate enough? If you are in the retail business does your POS system meet not only your current needs but future needs? As the technology cheerleader for your organization you will be more widely accepted into discussions as well as sought out for advice if you open dialogue first. This will also allow you to evaluate and take control of project timelines. It’s important for IT to dictate when IT can get things done. If you don’t take control somebody else will and I assure you, you won’t like that very much.

3) Don’t go it alone. I worked for a very wise VPIS one time. He said to us once “I’m not going back up there anymore, they just think all we do is spend money.” As I said, accounting thinks IT is a black hole. If the VPIS or CIO is the one pitching the new purchasing system to the CEO, then he or she had better be an expert as to how it is really going to save money for the company. Since you’re not an expert in it, don’t go it alone. Bring the plan with your fellow department heads that will be impacted to help make your case. This of course means you have to sell them on the system first, but that’s OK.

4) Honesty is the best policy. Far too often we are quick to give users a generic answer so we don’t have to answer a lot of questions. If we’re more transparent about things people will trust us more. That doesn’t mean that if your Exchange information store gets corrupted you start telling everybody they have the potential of losing all their mail – that causes pandemonium. You do however explain to them that there is a critical and severe problem with the system and you’re working on restoring connectivity as quickly as possible. If you have a failure situation and need to restore you tell them. “We know what the problem is and project you will be without mail access for up to two days as it will take that long to restore the system.” People will respect that a lot more than “we’re working on it, it will be up when it’s up.”

5) Change control. Everybody hates it, nobody wants it, and it adds tremendous red tape to any project – but it can improve the process tremendously. If departments are aware there is a proper process they need to follow if they want to implement or change something then they will improve the communication with IT and vice versa. It’s also a paper trail to protect the investments of the company.

6) Smile. Keep in mind; most people only talk to you when something doesn’t work. They never call to ask how the day is or tell you how great the network is performing. They will also spring something on you at five o’clock on a Friday. When something breaks, smile, make them laugh. A smile goes a long way

7) Communication between IT staffs and the rest of the organization are very important. As businesses grow more dependent on technology it is important for IT professionals to evaluate the needs of their business. Understanding what marketing needs – and why – goes a long way to forming a mutual respect and communication between the two departments.

The supply chain is the core of any business. Most people attribute the supply chain to that of a large corporation, but every business has a supply chain. You have suppliers, purchasing, production, distribution, and finally customers. The end result of every supply chain is always customers. The problem with any supply chain is it is only as strong as the links in the chain. If a link is weak then your supply chain breaks down. This has impact on customers which in turn can negatively impact your business.

Twenty years ago it was pretty easy to hide a breakdown in the supply chain from your customers. You could make up for a slowdown in production by speeding up shipping or increasing your acceptable rate of failure on products to higher levels and making up for it on warranty exchanges. Customers in general moved at a slower pace and were used to doing business at a slower pace.

Today technology has dramatically impacted the supply chain process and the way it interfaces with customers. Customers are digitally connected and dialed in. They want answers, they want them now, and they don’t want to wait. They expect you to have their personal portal updated with a tracking number and estimated shipment date within 10 minutes of placing an order. Telling somebody it might take up to 14 business days is no longer acceptable.

Though technology has made your supply chain more transparent, it has also improved the links in your chain. Retailers for example are completely tied together through technology. They have advertising management systems that forecast what products should be put in your ads based on trends. They have inventory control software that will automatically monitor inventory levels, and make purchase recommendations based on projected demands. This application is most likely tied to their digital purchase order system where the category manager can approve the purchase via their blackberry.

Technology has rapidly and dramatically improved the ability to manage the supply chain process more efficiently, as well as making information virtually on demand for customers.

It does not come without its complications though. Each CIO that is in the process of migrating, upgrading, or changing supply chain technology needs to take the following things into consideration:

1. Learning curve. Most organizations don’t change or update technology very often. Though you have every bit of confidence in your employee that they can simply just “figure it out” I assure you they don’t share the same sentiment. Make sure you evaluate the learning curve and budget for effective training. Your organization and supply chain is only as effective as the training you provide to your employees.

2. Overall Impact on the business. Everybody who wants to sell you a product will tell you about how great it is. I worked at an organization once where the CEO said “Never a vendor.” The best example I can give of this is buying a “white” dog toy because they tell you it’s the best selling product. Anybody who owns a dog knows you never buy a white dog toy as it shows the most dirt – ask anybody who works at a pet store they will tell you the same. So don’t take the vendor’s word for it. Make sure whatever product you are investing in meets the needs of your company both today and tomorrow. Would a SaaS or cloud be better for you? Would a custom homebrewed app be better for you? These are all questions you need to answer. Meet with the architect and discuss your strategy for the future. I can’t tell you how many situations I have been in where the sales/marketing application didn’t integrate properly with the PIM or inventory control. This can lead to costly custom changes to marry your applications together. Evaluate the impact this is going to have on the disruption to your supply chain and acceptable downtime. With any new system you will have downtime – we call this an investment, but at some point the downtime stops being an investment and starts being costly.

3. Measure the performance. It’s easy to sit back and say “hey look we’re automating things and cutting a gazillion dollars from the bottom line,” but make sure you can back these numbers up. Whatever supply chain management tools/systems you implement you will need to show equitable tangible monetized value. No tool is useful without effective reporting.

Improving the technology you utilize for supply chain management will increase your productivity as well as the bottom line. You will work more efficiently with fewer payroll demands, and improve your customer experience by being able to provide them with real time on demand information.