The Effective Leader’s Guide to Enterprise Software

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This e-book is for leaders who want to excel by using information technology (IT) as a catalyst to transform their businesses. It is divided into four areas: Becoming a Transformational Leader, Leaders as IT Strategists, Leaders as Sales and Business Development Strategists and The CEO as a Leader of Disruptive Change

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The Effective Leader’s Guide to Enterprise Software

  1. 1. The EffectiveLeader’s Guide toEnterprise Software:Competing with Intensity and Insight in Turbulent Times Global Strategic Partner for Manufacturing
  2. 2. A CEOs priorities havea direct impact on profits.How and where CEOsinvest their time has a A Leader’s Guidedirect impact on the This e-book is for leadersperformance of their firms. who want to excel by using informationMany leaders agree that technology (IT) as asetting vision and strategy, catalyst to transformplanning acquisitions and their businesses. It isinvestments, motivating and divided into four areas:leading their employees toexcel and contributing to • Becoming abusiness development and Transformational Leadersales management are allhigh priorities. Many CEOs • Leaders as IT Strategistsand general managers arechallenged with getting their • Leaders as Salescompanies to execute as well. and Business Development StrategistsGiven the proliferation of socialmedia and the quickening • The CEO as a Leaderpace of new ventures, these of Disruptive Changeleaders are often also thecompany spokespeople on allnew developments.From the new start-up to the suites of Fortune 100 companies,the challenges are the same. Leaders successfully guiding theircompanies through these turbulent times share a passion for makingthe most of all available intelligence, insight and information. Theyalso excel as IT strategists, aligning the complexity of informationsystems in their organizations to strategic priorities and goals. 1
  3. 3. The First Four Steps on the Fast Track to Becominga Transformational LeaderIf you think about the best bosses you ever had, the ones you’drun through a brick wall for, they did four things really well—notjust for you, but for everyone on the team. And they did thesefour things with amazing authenticity and transparency. Today’semerging and longstanding leaders have added technology tofurther support and strengthen their roles. What can you do?1. Show that every person matters. The greatest leaders have this down to an art form. They use enterprise software to connect with every employee, showing sometimes in real time how a business is doing. Leaders have very high expectations of technology in keeping their teams together. In fact, they have higher expectations than the CIOs when it comes to the transformational value of IT (Johnson, Lederer, 2007)1.2. Create a culture that thrives on learning and intelligence. Transformational leaders know that their best performers aren’t there for the paycheck; they are there for the challenge. A strong CEO and leader will use IT to create collaboration and communication opportunities throughout the entire organization, and this includes CRM, ERP, SCM and many other enterprise systems. Leaders and CEOs who are thriving now are focused on making these enterprise systems unified to create a world-class learning culture.3. Inspire by doing more than you expect others to do. The greatest leaders all share this trait; they are willing to sacrifice far more than they would ever ask a subordinate to do. This breeds exceptional trust and gives everyone a very clear idea of how their contributions matter. Great CEOs are building enterprise systems today that further strengthen this with real-time feedback; not just employee performance, but the performance of strategies and key customer-facing processes. 2
  4. 4. 4. Build accountability into their enterprise systems and regularly revisit its effectiveness. One CEO I know regularly visits customers and provides contributions to the company CRM system after each visit. He does his own comments on the records of other C-level and senior-management teams he meets. His and the senior-management team’s system usage is visible for anyone on the CRM system to see. This led to the CRM system being adopted by more than 15 percent of sales personnel within three days.Great Leaders Are Also IT StrategistsThree Strategic IT Priorities1. Projects that enable the company to develop and offer new products and services more efficiently and in less time2. Projects that provide new decision support information to top, middle and lower levels of management3. Projects that use existing and planned IT investments to find new ways for the enterprise to competeThe most successful leaders use their transformational leadershipskills to get these three strategic priorities accomplished, whilemaking sure that every aspect of the business stays synchronized.To get a sense of how difficult this is to do well, see the GartnerDemand Driven Value Network (DDVN) in Figure 1. This is a graphicalillustration of how complex the collaboration, communication andsynchronization challenges are for CEOs today. 3
  5. 5. Figure 1: Demand-Driven Value NetworkCoordinating the Demand, Supply and Product networks iscomplicated by the fact that there isn’t an abundance ofoverlap and that each network has a tendency to go in theirown direction.Not only must a CEO keep the Demand Networks tightlycoordinated to Supply Networks, the existing product strategiesand often highly complex new product-development andintroduction (NPDI) process in the Product Networks area must becoordinated. The role of enterprise software in general and theERP system specifically is to orchestrate these three strategicnetworks of a business. When one considers that each of thenetworks shown (Demand, Supply and Product) have a naturaltendency to go off on their own direction, it becomes clearthat cost-reduction strategies alone in enterprise software areextremely tactical in nature. 4
  6. 6. Coordinating the Demand, Supply and Product NetworksWhat’s needed is a way to orchestrate all three networks into asingle, unified and highly powerful strategy.The highest-performing leaders today are using enterprise softwareas an accelerator to their vision and goals. They also realize thatonly by aligning ERP systems to their top three priorities will theirbusinesses have a chance to break through a market’s turbulenceand competitive chaos to succeed. One of the most powerfulstrategies for accomplishing this is aligning the ERP system to theneed for more accurate, precise information about new markets.One of the most effective transformational leader’s secretweapons: a two-tier ERP strategy.Get Insight to Compete with Intensity:How Two-Tier ERP Strategies Can HelpAs IT strategists, leaders are guiding their organizations toattain higher levels of agility than ever before. The longstandingassumption of having a single ERP system to serve a diverse,growing global enterprise is changing fast. No longer can asingle monolithic system keep up with the diverse strategicneeds of a company that’s attempting to penetrate entirelynew foreign markets.Two-tier ERP systems are giving enterprises the agility they needto compete more effectively. Hewlett-Packard used this strategyto create factories that are specifically designed to create moreeffective Asian supply chains while also gathering local marketrequirements to the strategy. 5
  7. 7. In any conversation regarding two-tier ERP strategy, the Harvard Business Review article, “Making the Most of Foreign Factories” by Dr. Kasra Fedrows surfaces2. Dr. Fedrows has completed decades of research on what makes distributed manufacturing centers globally successful. The Roles of Foreign Factories: A Strategic Matrix, Figure 2, shows how site competence should lead the strategic reason for the site, and mirrors Dr. Fedrows’ research. Figure 2: The Roles of Foreign Factories: a Strategic Matrix High Lead ContributorSite Competence Source Server Offshore Low Outpost Access to low-cost Access to skills and Proximity to market production knowledge Strategic Reason for the Site Two-tier ERP systems enable global enterprises to match the unique local requirements of every market. 6
  8. 8. The CEO as Sales and BusinessDevelopment ChampionMany leadership experts contend that the best CEOs come outof sales, while an entirely different set of studies offers operationsas the best path to the top job. Those citing operations showthat in manufacturing and highly complex enterprise businesses,operations provides the CEO with a unique, global view of thebusiness—a view that otherwise would have to be learned onthe job (Koyuncu, Firfiray, Claes, Hamori, 2010)3.Regardless of background, a CEO must excel at orchestratingcustomer-relationship and selling strategies, long-term businessacquisition and project execution. Figure 3 shows how these threeareas intersect and how critical it is to have a strong enterpriseprogram management strategy to have 360-degree views ofthese areas.Figure 3: Getting to Optimal CEO Performance: Finding the Intersectionof Strategy, Acquisition and Execution in Your Company Bottom Line: CEOs who excel in their roles as sales and business-development leaders deliberately set up internal governance and compliance frameworks supported by enterprise software to free up their time for customers and selling. 7
  9. 9. The need for process spectrum flexibility, enterprise-wide processorchestration and decision management including analytics are alsokey. Figure 3 shows the unique role of the CEO as orchestratingthese three core areas as well. Business development and salesare areas where the majority of CEOs say they want to spendmore time yet can’t due to time constraints.The CEO as a Passionate Leaderof Disruptive ChangeBoth the person who aspires to be a CEO and the individualserving as one today needs a very clear, compelling vision oftheir company that is centered on the customer. They also haveto be so passionate and believe so strongly in the vision of whatthey are doing that they willingly sacrifice for it and inspire othersto do the same. There must be a compelling reason for the entirecompany to go through a significant change and ride throughturbulent times, emerging stronger for it. And that compellingreason must be solidly based on the customer and deliveringthem exceptional value daily. That only happens when they aregalvanized around customer-based vision.But how do the highest-performing CEOs make their visions ofbeing a customer-centric business turn into great results? By beingpassionate and entirely focused on the attainment of challenginggoals, regardless of market uncertainty or turbulence in theirindustries. They push through those obstacles and knock downone goal after another, undaunted. 8
  10. 10. How? By creating teams who believe they can, by setting up teamsto win and by balancing short-term (transactional leadership) withlong-term (transformational leadership) goals. They also do thisby balancing transactional leadership skills that reward immediateperformance with a compelling vision of the future everyone canidentify with.Figure 4: Transformational BalanceBalancing short-term needs while making progress toward long-termgoals is the mark of a true transformational leader. 9
  11. 11. The balance of transactional and transformational leadership iswhat separates the highest-performing CEOs who deliver greatresults year after year. This ability to move between transactionaland transformational leadership has to be based on trust tosucceed. The best CEOs get it. They realize trust is the catalystof disruptive change, and information technology can makethem more effective as leaders of change.Eight Key Takeaways for Transformational Leaders1. The highest-performing leaders and CEOs have developed a strong set of transformational leadership skills and continually work to improve them. These transformational leadership skills, including emotional intelligence, help the highest-performing CEOs move quickly between their roles of IT strategist, sales and business development leader and leader of disruptive change.2. CEOs who are IT strategists are able to better align their existing and planned IT systems to challenging and highly profitable customer-driven strategies. Measuring the performance of IT systems by their contribution to gross contribution margin (GCM), Lifetime Customer Value (LCV) and the success of multichannel selling and service strategies is more important than just measuring cost reduction.3. Efficiency only matters when it’s measured from the customers’ standpoint, not from internal metrics. The top-performing CEOs who are IT strategists are able to define analytics and metrics that measure collaboration that meet and exceed customer expectations first. These CEOs seek to architect their systems so that customer expectations get met and exceeded as a result of having excellent internal system performance and coordination. 10
  12. 12. 4. Using two-tier ERP strategies as a strong catalyst of global competitiveness and gaining the critical intelligence and insight that’s necessary to excel in new markets is a must-do. Each regional, national or foreign market has its own unique attributes, characteristics and cultural factors that influence the quality of information in IT systems. Having an ERP system in specific subsidiaries, especially for manufacturing companies, can mean the difference between staying competitive or not. The greater the quality of information in a subsidiary the greater the agility. CEOs who are IT strategists are relying on two-tier ERP as a means to quickly enter new markets and get operations up and running quickly.5. Excelling as an IT strategist requires a leader to see IT systems as sources of differentiation not just cost reduction. The highest-performing CEOs are championing these three priorities within their organizations today, making sure that IT systems align to their attainment: a. Projects that will allow the company to develop and offer new products and services more efficiently and in less time b. Projects whose primary benefit is providing new decision support information to top, middle and lower levels of management c. Projects that use existing and planned IT investments to find new ways for the enterprise to compete 11
  13. 13. 6. Be ruthless about aligning IT systems to customer requirements to excel in the role of Sales and Business Development Strategist. From GE with their Six Sigma programs that are specifically designed to keep their products aligned to customer needs, to FedEx and their world-class approach to tracking customer packages, making IT systems align to customer requirements is critical to succeed.7. Leaders of disruptive change start with a compelling customer-centered vision and use IT to galvanize their companies around it. CEOs who have exceptional transformational skills have the ability to balance short- and long-term goals while keeping their enterprises focused on excelling for the customer. Using IT as the catalyst of making disruptive change permanent are what these CEOs are capable of achieving. We’ve provided a graphic of how this dynamic works in Figure 3.8. Most important of all, a leader lives the vision. Daily, with passion, they lay it all on the line, and people respect and trust them for it. 12
  14. 14. References1 Johnson, A. M., & Lederer, A. L. (2007). The impact ofcommunication between CEOs and CIOs on their sharedviews of the current and future role of IT. Information SystemsManagement, 24(1), 85-90.2 Fedrows, K. (1997), Making the most of foreign factories.Harvard Business Review, 75(2), 73-88.3 Koyuncu, B., Firfiray, S., Claes, B., & Hamori, M. (2010). CEOswith a functional background in operations: Reviewing theirperformance and prevalence in the top post. Human ResourceManagement, 49(5), 869. 13
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  16. 16. Cincom and the Quadrant Logo are registered trademarks of Cincom Systems, Inc. MicrosoftDynamics is a registered trademark of Microsoft Corporation. All other trademarks belong totheir respective companies.© 2012 Cincom Systems, Inc.FORM CMUS1204047 10/12Printed in U.S.A. All Rights ReservedWorld Headquarters • Cincinnati, OH USAUS 1-800-2CINCOM (1-800-224-6266) • International 1-513-612-2769Fax 1-513-612-2000 • E-mail info@cincom.com • www.cincom.com

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