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Technology Will Take You Only So Far

Posted by admin on September 25, 2012

A colleague of ours loved to tell the story of sitting in a plant manager's office after hours. The production workers had left for the day and the plant manager looked over the shop floor at the company's recent major investment in automated machinery. "This place would run like clockwork if it weren't for the people," he said wistfully.

The story shows the faith (often misplaced) we have in technology to solve our operating problems. "If we only had the latest (fill in the blank), all our issues would be resolved". How many times have we heard that? It is usually followed by: "We spent a lot on (fill in the blank). How come our results haven't improved?".

The technology panacea does not work because it is one dimensional. Technology is just one part of the equation for a best-in-class company. In order to get the payback on your technology investment, your processes, people and technology must align to support your strategy. If any of these pieces are misaligned, you will not realize the ROI you expected.

To picture this, it can be helpful to think of the classic three-legged stool where strategy is the seat supported by three legs (technology, processes and people). If any of the legs is incorrect (wrong angle, short, broken, etc), the seat would be unusable or at least difficult to use. To be most effective, the three legs must work in concert to support the strategy.

For example, if you have invested in new machinery and have not considered how work processes and employees' skills may need to change to get the most out of that technology, you may be over-relying on technology to fulfill your strategy.

Recently we were talking with a senior production executive whose company had make a major investment in technology upgrades. He could see the output of any machine in the company's numerous plants in real time on his BlackBerry. Pretty amazing stuff! But when we asked what action his people would take if his BlackBerry showed one of the machines was suddenly underperforming, the answer was not very specific. In other words, the company's technology investment could let them know they had a problem, but the people investment in how to effectively identify and correct the cause of the problem might not have been as impressive.

We all have seen the misalignment of strategy and technology. This happens for a number of reasons:

  1. Not having a clearly articulated strategy
  2. Having a clearly articulated strategy but getting distracted by a "bright and shiny" technology without testing how it helps fulfill the strategy
  3. Having such a long-lead time on technology selection and installation that by the time it is up and running, the strategy has changed due to market conditions

So before you invest in the latest technology, ask yourself these key questions:

  • How will this technology help us fulfill our strategy?
  • What processes will we need to change to maximize our results from this technology?
  • What new skills do our people need (and other skills do we not longer need) to fully harness this technology?
  • Is a technology expenditure really required or can we get an improved return from our people and processes?

If you have already installed new technology and are not seeing the results you expected, test the processes-people-technology alignment and how well they are supporting your strategy.