Package-Enabled Design: A Path to Greater ROI

There are a few traditional tenets of re-engineering hold true: Begin with a clean sheet of paper; to be most effective, there can be no constraints or boundaries; redesign must start with the process; and technology is an enabler for achieving the desired state, not the driver of the design.

The reality, however, is that there are almost always compromises or constraints to consider. A common one is the organization's ability (or lack thereof) to come to grips with and quickly implement a radical redesign. Companies with cultures that dampen creativity and risk-taking tend to struggle the most with re-engineering implementation. While these organizations may succeed in redesigning their processes on paper, they almost always need heavy support and stern motivation to actually implement change.

Organizations that are contemplating or in the midst of a system change or conversion should recognize opportunities for the new system to serve as the engine for change. Package-enabled design emphasizes radically rethinking business operations using a software package's functionality as a framework for redesign. In this approach, the package functionality and configuration options are used to challenge current practices and suggest new processing paradigms. Without taking a fundamental look at business processes, job design, organizational structure, management practices, and reward systems in conjunction with a major system replacement, that system's return on investment and business impact will be severely diminished.

[Previous commentary from The Nolan Company: Former Aflac CIO Gerald Shields on agile development]

The redesign concepts are the same, but consider these important caveats and distinctions between the package-enabled concept and traditional redesign efforts:

• The effectiveness of package-enabled design depends on the robustness of the software. It is important that the software selection process objectively examine packages that represent advancements over current business practices.

• A rigorous software modification assessment and approval process is critical in order to protect the organization from resisting the changes that are suggested in the software package. Without this, the organization runs the risk of modifying the software to replicate current (and often inefficient) business practices (a.k.a., "paving the cow path"). In other words, customization of the packaged software will likely negate major benefits of the new system by erasing opportunities to redesign core processes. Any proposed modifications to the new system must therefore be in sync with process redesign objectives, including new customer experience goals, organization design, job design, metrics, and management practices.

Michael J. Meyer, The Nolan Company

• An enterprise view of the system functionality, user-driven system options, and core interfaces to other systems is required in order to maximize positive impacts on work processes and on other departments and systems.

• Distinctions between process and procedure steps that are system-driven as opposed to those that can be designed independently from the system must be understood.

• The "leap to the ideal" step is conducted with the system in mind and involves applying redesign concepts to arrive at the ideal package-enabled environment.

• The schedule of the redesign implementation should be linked to system implementation time frames, which will influence the logical sequencing of events.

• As with any redesign effort, business readiness can be a make-or-break x-factor. The organization must perceive the system replacement as a transition to a new way of doing business. Furthermore, the changes will likely affect department structures, skill sets, training, organization, and performance measures among other operating paradigms.

A package-enabled design effort can be a powerful tool to help companies achieve a greater return on investment for a major system conversion. However the system alone must not be the only driver of change; rather the system should be used help facilitate change. A system replacement provides an opportunity and framework to take a fresh look at how business is done and how to improve it. At the same time, employees are more open to new ways of doing business because the unavoidable system change is the catalyst for transformation. Implementing a new system alone will not result in a successful operational redesign – it takes a balance of new technology, operations redesign, and change management.

About the author: Michael J. Meyer is a principal consultant with The Nolan Company.