Ouch! Now I’m sure I will get some hate mail/posts/tweets from people in my industry and pretty soon from my own company’s marketing department for saying such a bold statement. Before you flame me, all I ask for is five minutes to explain my position and then, if you don’t agree, you can smack me.
Recently I was listening to one of my favorite podcasts, Freakonomics, and they had a great episode called “How to be more Productive.” As a natural procrastinator I like to find ways to maybe (not really) improve my general productivity. During the episode Steven Dubner spoke with Charles Duhigg, the writer of “The Power of Habit” about his new book “Smarter Faster Better” and productivity. During the conversation he highlighted a story about the move from steam to electric in US factories and the lack of productivity improvements factories experienced. See the excerpt below.
DUHIGG: When electricity was first popularized, there was this huge wave of factories that replaced their steam engines with electrical engines. And almost none of the productivity of those factories rose initially. This has been referred to in economics literature as the productivity paradox. And as researchers went back and they tried to figure out why, what they found is that all the factory managers had arrayed all of the machines, had lined them up on the factory floor, so that they could have these steam pipes that would run from machine to machine. And when they electrified the plants, they left all the machines in the same places; they just replaced the pipes with wires. It took like 20 or 25 years for plant managers to start saying, “Look, the strength of electricity isn’t simply a new power source. It’s that we can move these machines in ways that we can have workers work more efficiently or we can use less people or we can create an assembly line.” And that’s where the productivity increase really came from.
So what do steam pipes at factories have to do with my statement about the “cloud” and the lack of productivity gain?
Pulling from my own experience and meeting with executives for the last 10 months, I feel like the situation above is being 100% repeated in our new digital era. The amount of meetings I’ve been in where customers think moving their existing processes to the cloud is going to change their contact centers’ productivity is surprising to me. It’s like me buying a new pair of pants and thinking that they’ll result in my waistline going down! No, I have to make major changes in my daily routine if I want to lose weight.
This isn’t a negative reflection of the people I have met with, but rather a general reflection of how companies look at platform changes. I’ve been in the exact situation most of these executives are in, they’re initiating a platform change that their reputation/career is going to be associated with. So what do you in this situation? You limit the amount of variables that are in the path to moving to the new platform. This typically means that you remove the risk of changing the business processes while you’re changing the platform technology. You can “come back to” the processes and update them after everything gets moved over to the new platform. We end up with the same old processes running on new shiny technology, so we end up seeing little to no real gains in business productivity. If we do see any gains they tend to be experienced in the IT department around staffing and platform costs. Which in my experience typically also leads to an unsatisfied customer.
Ok…so what do we do about this?
The first step is admitting that we have a problem and we want to change…ummm… moving on.
One of the big advantages I see with the cloud is the capability it actually provides for companies to have an easy path to experiment with the re-engineering of their business processes. Most cloud services are on-demand, quickly setup, and pay for use; which means the barriers to entry and risks are extremely low in comparison to legacy software models. I recommend to customers to introduce it as a parallel platform to enable business change instead of moving to the cloud as an immediate system replacement. This is the best way to achieve the productivity improvements you’re looking for. I know this is easier said than done and sometimes realities outside of your control will drive your actions.
From my experience I have found multiple successes in deploying various cloud technologies using this strategy. If I reflect on three major projects the common elements of my strategies have been:
- Start Small
- Focus on solving a defined tangible problem with a small cross-functional group.
- Attack the problem without constraints.
- Trial Solutions
- I’m a huge fan of the scientific method, so just start to use the different solutions to see if any of them work.
- Identify which of the workable solutions have further potential.
- Show the Solution
- Show how the new solution solved the problem.
- Identify what you’ve learned on the journey.
- Outline the Vision
- Show how the solution will solve other problems.
- Demonstrate how to grow and integrate the solution into the wider organization.
Using the steps outlined, all three of the platforms my teams have worked on started as month-to-month services on my corporate card and grew organically from there. Most (not all) of them have been very useful tools helping the organization to continue to evolve. Now that the vision has been met and honestly exceeded from my original vision, I look back and reflect that had we attempted to present the solution upfront it would have died on the vine or we would have simply moved our existing processes to the new technology.
Remember the strength of the cloud is not just the change in the consumption and financial models, but more importantly in the business process innovation it can spark.