Saturday, 13 June 2015

IT Strategy Case Study

Some time ago I was asked to provide assistance to a key department within a company, where a variety of IT issues needed to be addressed.

My approach was to examine the problems which existed and to determine a long-term IT Strategy which would handle both the current and any future issues which we believed might occur in the next 10 or so years. This is my preferred approach rather than to take "urgent" action, which companies often do, but which if not thought out fully can be misdirected and actually cause further difficulties.

One of the key steps in the creation of an IT Strategy is to identify typical problems and to fit them into a framework of standard actions which mean that (hopefully) there will be fewer surprises in future.

ISSUES

There were several issues which needed to be addressed. The main one was that there was a very old database system in use (Problem 1), but it was so inaccurate and difficult to use that many staff had set up their own spreadsheets (2) which were easier for them to use.

This is a crucial mistake. If staff have their own spreadsheets then they "know" they are correct. This makes them lax about keeping the central system up-to-date. If they make input errors they don't notice them (3) as they use their spreadsheets rather than the company system to help them make decisions. It is very important that organisations have their information in one central database, otherwise all sorts of problems can occur.

With my customer, when questions were asked, the various spreadsheets produced conflicting answers, and no-one really knew what the correct answer was. This applied to diverse areas which were crucial to my client's business.

In addition to the three main problems, a minor but irritating point for the staff was that they were based in several locations. In some of these Internet bandwidth was very limited, so that some staff never got good (timely) responses from the central system and gave up using it (4). In fact they often got a better response from their home PCs.

Again, if staff are not using the central system then it may well be that the data is not being validated as the staff are using other methods to obtain answers. (Another company I dealt with had staff who persisted in using paper files as they were easier to access than the main computer system.)

As with many systems, there was also no simple way for staff to obtain reports (5). When senior managers asked questions it was "all hands to the pumps" as staff rushed round looking at their spreadsheets, creating new ones with look-ups, totalling figures and generally committing a minimum of two man days work to produce any answers, without being sure that next week's answers would be the same.

Another issue which strongly affected my client was that accounting was carried out on a completely separate mainframe computer, updated by means of a multi-part paper document (6) which had long outlived its natural lifespan.

The accounts staff did not trust the information in the department's system so they ignored it, even though it was being used by company staff to assist with many of their day-to-day decisions. Another irritation was that when accounting reports were provided (at least two weeks after period end) staff often disagreed with the figures provided, but had no easy way of clarifying why there were discrepancies (7).

One area which affected my client department quite adversely was that there was no central system for recording orders (8), which meant that commitments already entered into were not understood. When invoices came through they were recorded against the current period and year, so that at any moment staff could think they were under or over budget by large amounts without being aware of the exact situation. As with many companies, towards the end of the financial year those areas which appeared to be under budget were ransacked to pay for areas which had gone over budget. The strongest tended to win.

Another minor issue was that many interactions with suppliers and customers were carried out by e-mail or telephone call, but there was no easy way of recording and filing what had happened (9). Some users dictated or typed (or handwrote) notes, while printouts of e-mails might also be filed. This resulted in bulky, difficult to read files and inconsistent results.

Finally, budgets were set once a year using an arcane process which took two months and which no-one understood. Budgets when completed by the department staff went to accounts staff who modified them, often without referring back to the initiators, who were left bewildered as to why the changes had been made. (10)

AN IT STRATEGY

As indicated above, the approach proposed was to identify a clear, long-term IT Strategy. The agreed strategy was to implement a central, modern, fully-integrated, easily-accessible, Windows-style, Internet-based system. A key aspect of this was that data would only be entered into the system once, avoiding duplication. Staff would not enter data into spreadsheets, but were able to extract data into Excel or as reports.

This directly handled problems (1), (2) and (3), and indirectly addressed many of the others.

A modern, Internet-based, Windows-style system does not require great amounts of bandwidth, but in any case the company made sure that all staff had easy access to the Internet and reasonable download speeds. This addressed problem (4).

Now that all the staff are using the same system they are able to see any data errors and then to ensure that the central system is correct. Only one set of figures is now used for reports, and if similar information is asked for a week later, the two sets of figures agree.

The system that was installed had a range of reports provided (5). In addition it is very easy for users to query the data and then download an Excel spreadsheet containing the relevant subset of data. Users have been trained to use and discard spreadsheets so that the next time they ask a question they download a fresh set of data. The system came with a report writer which allows trained staff to write new reports, and even untrained staff can modify reports already in existence.

My client did not move to fully integrate their accounting, but there is no longer a multi-part paper form - updates are passed by means of an automated e-mail (6). In an ideal situation there would either be (a) one system which was both a database and an accounting system, or (b) complete integration between the departmental database and the external accounting system so that all updates to the one were reflected in the other.

Procedures at period end have been tightened up so that staff have a much better view of the ongoing figures and can readily query discrepancies, which handles problem (7). (And see below.)

Problem (8) - commitments - is handled by ensuring that all invoices are matched up with an order, complete with expense code. Ideally the order should be created at the time the work is authorised, but even where it is not, the invoice goes to the correct expense code and there cannot generally be any doubt about where amounts are charged. This helps considerably in the control of budgets, and there is no longer the end-of-year budget robbery which we all knew and loved.

The strategic approach to e-mails has been to ensure that many are generated automatically by the system, while others are stored within the database (9). [There is now - 2015 - a range of even better solutions available. Up-to-the minute systems will capture e-mails sent from clients or any person in the department's contact database and automatically store them.]

The handling of the year-end budget process has been transformed by the creation of the central database (10). The system generates a potential next year's budget using user-defined parameters, and each responsible person then spends a short amount of time checking this. Sometimes this is where data errors are discovered, but these are soon corrected and new figures produced in half the time and with one quarter of the hassle. Because the budget figures are in principle produced by a computer system the accounting staff cannot change them without agreeing why, so everyone (if not exactly happy) can understand what is going on.

THE FUTURE

So how are your systems? Call me if you would like me to help you set an IT Strategy.


No comments:

Post a Comment

© Copyright 2013, 2014 Cameron Somerville Web Designers Toolkit Websites