Social Business Innovation & Legacy Systems

LEGACY SYSTEMS DEFINEDA legacy system is an is an old process, tool or behaviour thatcontinues to be adopted even though more efficient methods ofperforming a task are now available Legacy systems are often irrelevant in their current contextLegacy systems are a key cause ofvalue erosion and business failure -largely because they slow you down

NASAs Space Shuttle program still uses a large amount of 1970s-era technology. Replacement is cost-prohibitivebecause of the expensive requirement for flight certification; the legacy hardware currently being used has completedthe expensive integration and certification requirement for flight, but any new equipment would have to go throughthat entire process – requiring extensive tests of the new components in their new configurations – before a singleunit could be used in the Space Shuttle program. This would make any new system that started the certificationprocess a de facto legacy system by the time of completion.Additionally, because the entire Space Shuttle system, including ground and launch vehicle assets, was designedto work together as a closed system, and the specifications have not changed, all of the certified systems andcomponents still serve well in the roles for which they were designed.YOU ARE NOT NASANew technologies & new understanding of human behaviourpresent an opportunity to replace legacy systems moreeasily, cheaply & quickly than ever beforeYour business is not a closed system, it is an open system -the more open you make it, the more agility & innovation

THE IMPACT OFLEGACY SYSTEMSTHEY MAKE YOU SLOWTHEY DESTROY PRODUCTIVITY

AT NO POINT IN HISTORY HAVECOMMUNICATIONS & CULTUREMOVED FASTER THAN TODAYThe accelerating pace of change in business, characterised byglobal competition, means connecting the right people with theright information to drive business decisions means thedifference between success and failure

IT’S NOT THE BIG THAT EAT THESMALL, IT’S THE FAST THAT EAT THESLOW Avg life expectancy of companies in the S&P has dropped from 75 years (in 1937) to 15 years - collapsing under their own weightBig business is suffering from long-running performance declines Return on asset rates are declining, even as labour productivity risesThe 3/2 law of employee productivity states that trippling yournumber of employees causes productivity to drop by halfCompanies are no longer places that exist to drive downcosts by getting increasingly bigger. They’re places thatsupport and organise talented individuals to get betterfaster by working with others

THE NEW WORLD ORDERDEMANDS SPEED & AGILITYThis is the age of the collaborative, knowledge-based,hyper-productive organisation – where teams areconnected across departments and geographies

WITH NEW CAPABILITIES COMEGREAT EXPECTATIONSEXTERNAL INTERNAL24-7 REAL TIME AUTONOMYPRODUCT RESEARCH & COMPARISON TRANSIENCE & SELF EMPLOYMENT3RD PARTY RECOMMENDATION BORDERLESSNESSMISTRUST LEADERSHIP vs MANAGEMENT

EVERYONE CAN SHAREWHAT THEY CARE ABOUTPOSITIVE NEGATIVEREFERRALS & RECOMMENDATIONS BAD EXPERIENCES

SO YOU ACTUALLY NEED TOBE A BETTER COMPANYWITH A BETTER OFFERING

THIS IS THE ESSENCE OF BRANDBUILDING IN THE 21st CENTURYLOOKING BEYOND CAMPAIGNS

SOME BRANDS & AGENCIES AREONLY FOCUSING ON THE FAÇADEWHILE THE INNOVATORS OVERTAKEBY FIXING WHAT LIES BENEATH

PEOPLEPROCESS TECHNOLOGY

COSTS YOU ARE LIKELY TO BE INCURRINGNEEDLESSLY DUE TO LEGACY SYSTEMS INCLUDE...

THE COST OFSEARCHING A typical information worker now spends a quarter of their day searching for the right information to complete a given task10% of a company’s salary costs is frittered away as Source: Butler Groupemployees scramble to find adequate and accurateinformation to do their jobs

THE COST OFCOMPLEXITYOn average, the 200 biggest companiesare losing an estimated 10.2% of profitas a result of unnecessary complexity Removing this complexity would save each firm $1.2 billion of lost profits on average - or a total of $237 billion across all 200 firms

THE COST OF LEGACYSERVICE MODELSCall deflection savings from P2P support communities are typically 15-30%= £millions cost savings + increased employee efficiency Support communities increase conversions, average transaction value, reach, engagement and SEO - often becoming #1 traffic driver to your siteProduct issues are typically reported 3-4 weeks fasterthrough community vs traditional channels Customer satisfaction results are typically 15–30% higher amongst those who participate in user communitiesSome companies are eliminating phone and email support altogether

THE COST OF LEGACYDEVELOPMENT MODELSBRINGING THE WALLS DOWN AROUND YOUR DATA DRASTICALLYREDUCES DEVELOPMENT COSTS & ACCELERATES GROWTH Amazon were already achieving $19bn sales through their API by 200860% of eBay listings go through their API, with$500m in mobile-based application revenue

THE COST OFEMAIL ADDICTIONEmail costs organisations of 3000 people £15 million per annum– just over £5k per employeeFor a larger organisation of 6000 people, the cost escalates to £64 million– well over £10k per employeeProblems include ambiguous and unclear messages, email ‘overload’,security and privacy issues and destructive interruptions

THE COST OF LEGACYBUSINESS MODELS ADAPT & OUTPERFORMA better business modeloften beats a better ideaor technologyBusinesses competethrough their businessmodels - therefore thebusiness model itself isa source of competitiveadvantageA disruptively innovativebusiness model canbecome your company’skey asset and USP

THE COST OFENDLESS MEETINGSProfessionals attend on average 61.8 meetingsper month; and over 50% of this time is wastedAssuming each meeting is 1 hour long, this meansprofessionals are wasting 31 hours per monthOn an average salary is £40k, this equates to£7,400 wasted per employee each year

THE HIDDEN COST OFFEAR failure to innovate

THE HIDDEN COST OFUNOPTIMISED COMMSNew knowledge in neuroscience and behavioural economics canenable us to influence decision-making – yet these learnings arerarely applied in organisations, leaving money on the table For example a recent pilot study, applying behavioural economics principles, claimed the NHS could save £250 million in missed appointments simply by having patients write their own appointment cards

THE HIDDEN COST OFWHEEL REINVENTION

THE HIDDEN COST OFPRESENTEEISMTIME SPENT PHYSICALLY PRESENT BUT NOT REALLY DOING YOUR JOB

I’m distributing this presentation under a Creative Commons license,so feel free to share and change it according to these terms:http://creativecommons.org/licenses/by-sa/3.0/ Jane Young • Technology entrepreneur and founder of boutique digital agency Kanbee, agile project collaboration tool Scramblr and enterprise tool for innovation acceleration Daander. • Social business consultant to leading brands, helping them create and capture value from emerging trends in technology, society and the workplace. • Writing on social business and the new world order atwww.resonanceblog.com • jane@resonanceblog.com @resonanceblog http://uk.linkedin.com/in/janesyoung

Social Business Innovation & Legacy Systems

by ResonanceBlog on Nov 30, 2011

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Social Business Innovation & Legacy Systems — Presentation Transcript