All enterprises, regardless of what they produce or the services they deliver, are really information businesses.
The accuracy, speed and precision of IT systems means the difference between winning or losing customers, keeping supply chains profitable, and solidly translating new concepts into revenue-producing products and services. The world’s best-run services businesses have customer-driven IT as part of their DNA; it is very much who these companies are internally.
In the recently published Garter report CEO and Senior Executive Survey 2013: 21 Top Companies Admired for Competitive IT completed between October and December, 2012, which was part of the 2013 CEO and Senior Business Executive Survey, C-level respondents were asked to name the companies they most admired in terms of their ability to apply IT-related business capabilities for competitive advantage. Respondents were also asked to limit their responses only to their own and related industries.
391 respondents participated in the survey with 147 being CEOs, 149, CFOs; 49, COOs; and 46 being board members including Chairman of the board and president. Geographic distribution included 152 respondents from North America; 124 from Europe; 78 from Asia/Pacific; 20 from Brazil; 12 from South Africa; and 5 from the Middle East with minimum company size being $250M in annual sales or above.
The following is the list of the world’s most admired companies using IT for competitive advantage.
Most Admired Companies Making IT A Competitive Advantage
Hospital Corporation of America
JP Morgan Chase
Proctor & Gamble
- Customer-driven IT is the single most admired trait of all 21 companies in the list. Associated with this attribute is the proven ability of these enterprises to manage complex e-commerce systems & platforms, support multichannel management, in addition to continually show the ability to innovate quickly.
- Enterprises need to consider how the business successes their investments in IT are enabling can be used for branding and recruitment. Providing benchmark performance data and stories of how IT helped create entirely new markets and solve customer problems needs to be used for recruiting. Many of the 21 companies mentioned are doing this, using success stories as a catalyst for driving recruitment efforts for analytics, cloud computing and systems integration experts.
- Don’t underestimate the disruptive power of cloud computing and mobility to completely re-order enterprise systems quickly. Gartner mentions that there are enterprises whose IT organizations would have made the list had they not slowed down. While not directly stated, Gartner warns IT departments to not become complacent over time. From personal experience working in IT departments however, it is clear that complacency is a leading career hazard. It’s imperative for CIOs to keep challenging their organizations to stay intensely focused on new developments, seeking out how they can be used to strengthen business strategies.
- Four of the top five factors that most impressed respondents about the admired companies are customer-related. Customer-facing IT (15%); followed by an integrated/standardized/unified IT organization and process framework (13%); exceptional use of CRM (11%); customer-centered innovation (9%); and product design & offerings (9%) are the most mentioned attributes of the highest-performing companies. Multiple responses were allowed to this area of the survey. The following graphic provides an analysis of which factors most impressed the C-level executives who were respondents to the survey.
From the obvious to the outrageous, enterprise software predictions often span a wide spectrum at the beginning of every year.
In enterprise software in general and ERP specifically, there are many safe harbors to dock predictions in, from broad industry consolidation to Oracle buying more companies. Or the inexorable advances of cloud computing and SaaS platforms in ERP today, which is often cited in enterprise software predictions.
Too often predictions gravitate too much towards theoretical economics, overly-simplified industry dynamics and technologies, leaving out the most critical element: customers as people, not just transactions. So instead of repeating what many other industry analysts, observers and pundits have said, I am predicting only the customer side of ERP advances in the next twelve months.
The following are my predictions for ERP systems and enterprise computing in 2013:
- The accelerating, chaotic pace of change driven by customers will force the majority of Fortune 500 companies to reconsider and refine their ERP and enterprise computing strategies. Social, mobile and cloud computing are combining to provide customers with more acuity and articulation of what their preferences, needs and wants are. The majority of ERP systems installed today aren’t designed for managing the growing variation and pace of change in customer requirements and needs. In the next twelve months this trend will force the majority of Fortune 500 companies to re-evaluate their current ERP systems when it becomes clear their existing enterprise systems are getting in the way of attracting new customers and holding onto existing ones.
- Highest-performing CIOs will rejuvenate monolithic, dated ERP systems and make them agile and customer-focused, while at the same time excelling at change management. There are CIOs who can handle these challenging tasks, and the future belongs to those who can fluidly move between them quickly. In twelve months, a group of CIOs will emerge that are doing this, delivering significant gains to gross margins and profitability in their companies as a result. They’re the emerging class of rock stars in IT and enterprise computing.
- Quality ratings of ERP systems by internal customers will become commonplace, including 360-degree feedback on ERP performance. This is overdue in many companies and it takes a courageous CIO and senior management staff to value feedback on how their ERP systems are performing. In the most courageous companies, within twelve months the results of these internal surveys will be posted on bulletin boards in IT and throughout IT services departments. For some companies this will be first time IT staff members have a clear sense of just what internal customers need, how they are being served, and what needs to be done to improve business performance.
- ERP systems built on a strong foundation of personas, or clear definition of customers and their roles, will overtake those built just on features alone. This is already happening and it will accelerate as featured-based ERP systems prove too difficult to be modified to reflect the fast-changing nature of personas and roles in organizations. The quickest way to determine if a given ERP system launching in the next twelve months will succeed or not is asking what personas it is based on and why.
- Customers push speed and responsiveness from a “nice to have” to a “must have” as advances in mobility platforms and integration make real-time possible. If there is one unifying need across the personas of customers an ERP system serves, it is the need to improve responsiveness and speed. The same holds true within enterprises today as well. It would be fascinating to look at the data latency differences between market leaders versus laggards in the airline industry for example. Customers will push accuracy, speed and precision of response up on the enterprise computing agenda of many companies this year. Speed is the new feature.
- What were once considered ERP-based operations bottlenecks will be shown to be lack of customer insight. Take for example the very rapid product lifecycles in retailing. At first glance slower sales are attributed to not having the right mix of products in stores, which is a classic supply chain problem. Yet customer-driven ERP systems will tell retailers a different story, showing how product selection, even suppliers, are no longer pertinent to their customers’ preferences and needs. More customer-centric ERP systems will help retailers overcome costly and difficult to recover from bottlenecks in their operations.
Bottom line: Enterprises clinging to monolithic, inflexible ERP systems need to re-evaluate how their enterprise computing strategies are serving their customers before their competitors do.