Implementing CRM will entail flexible thinking
ERP is out and CRM is in - that is the message the pundits are giving in the wake of troubles among ERP suppliers. But it's not a case of changing fashions. The new e-business technologies pose concrete problems for IT directors that demand new ways of thinking.
Aligning IT with the business is a mantra most IT directors have grown up with. But with e-business to achieve this aim takes genuine flexibility of thought and action, for which the traditional route to IT leadership provides little preparation.
In the old economy, measuring return on IT investment was easy: the main benefits were derived from automating back office processes, or integrating different parts of the enterprise system.
But with customer relationship management - one of the must-haves for any go-getting business manager - the ROI case is far more difficult to express. Until the creative brains of the organisation get hold of the package and learn to interrogate data in ways they never knew they could, the benefits may be unmeasurable and unpredictable. The same is true for knowledge management and business intelligence tools.
At the same time, the sheer unpredictability of the emerging online markets means no IT director can afford to bring in a system that sets business processes in stone.
ERP's great strength was its flexibility in meeting the needs of individual businesses - and installing it often forced managers to re-look at the whole enterprise plan before setting it in the expensive concrete of an ERP implementation.
But in the e-world it's not a case of one-off re-engineering remedies. Agile businesses will want their business models to be constantly reviewed. The strongest attribute of the latest information technology is its power to transform business models completely, and in unexpected directions. And, of course, to empower employee creativity.
There is no ready-made action plan to deal with this new world, but here's two bullet points for starters: pilot your projects small, and develop predictive models of your business.
IT strategists have to be cleverer in formulating the case for IT investment.
With CRM the big-bang approach of ERP has to be replaced with an incremental strategy. So piloting technologies like CRM is essential to quantify their impact on the business.
Pilot projects have an important role to play in changing business culture, but the real skill is to manage the pace of change to ensure you don't run so fast that you fall over.
But while you take the empirical route, a large dose of analytical thinking is also required.
When we attempt to align IT to the business, we are always working with an implicit model of the business. IT strategy has to draw out predictive business models far more explicitly - because they are changing fast in all sectors of the economy.
Armed with the results of pilot projects, and a predictive business model that allows you to guess the impact of an enterprise roll-out, you can navigate a path through the CRM minefield.