Digital Thoughts

for the

Chief Executive
By J Philip Scott

How to Keep Ahead in the Digital Age; A Chief Executive’s Private Guide.
next

For Amelia

Copyright © J Philip Scott, 2001 ISBN 0-9583594-9-0
This publication is copyright. Except for the quoting of brief passages for the purpose of reviewing, this ebook may not be passed on to any other person in whole or in part by any means whatsoever. This includes internet email and World Wide Web servers. Other than storing on the purchasers personal computer, it may not be stored in a retrieval devise or transmitted in any form, electrical or mechanical including photocopying without written permission from the author. Infringers of copyright, including the receivers of illegal copies, render themselves libel for prosecution.

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Table of Contents
1. Introduction 2. Case Study 3. Why The Computer 4. Creative Computing 5. Lateral Thinking 6. Delphi Technique 7. Strategy and the Strategic Plan 8. Shareholder Value Added 9. Computer Staff 10. Consultants 11. Contractors 12. Common Sense 13. Critical Success Factors 14. Customers 15. Daily Operating Control (DOC) 16. Data Warehousing 17. E-business 18. Facilities Management (Outsorcery) 19. Gobble-de-Gook 20. How Much Do I Spend? 21. Interfaces 22. Just In Time Knowledge Workers 23. Muddle Management 24. Open Systems 25. Programmers 26. Project Management 27. Prototypes 28. Request For Information (RFI) 29. Request For Proposal (RFP) 30. Risk Analysis 31. Solutions 32. Testing 33. The Branch Office 34. Training 35. UPEL 36. Writing Reports 37. Epilogue 38. Summary How to navigate this book

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1. Introduction
To err is human - and to blame it on the computer is even more so.
Robert Orben

This is a book for General Managers. It will give you a philosophy for dealing effectively with computers and all the baggage that goes with them. A philosophy and a strategy for ensuring that your computers will work to improve the return on the money invested in your organisation. It will also ensure that you have a strategy for leading your staff into an increasingly complex “computer age” rather than have them wandering up expensive side tracks. You can use computers for greater efficiency and to reduce costs. They can give you a competitive advantage and be a delight to your customers OR they can be an expensive disaster.

Major organisations are still making basic mistakes that others made many times before. One example of this is the New Zealand National Library. The senior executives in the early 90’s decided to work with the Australian National Library and build a new suite of software to fit with their unusual requirements. This was a big project scheduled to take some years to complete. To make things even more difficult they had the problem of designing requirements for two organisations in two countries at the same time. The library had spent $9,000,000 when the government became concerned enough with the lack of progress to cancel the contract. The newspapers of course made this very embarrassing for all concerned. The news on this morning’s radio is of our new police computer that is running well behind schedule and about $20m over budget. The new software will not be ready before the start of the

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year 2000 so there is now the extra expense of upgrading the old software to be Y2K compliant. If they can do it in time1. Similar scenarios have happened many times in the past and they will happen again. This book will help you avoid these and other major pitfalls. But more than that, we develop a philosophy and strategy for harnessing the power of computers that will enhance and develop your business as well as make it run more efficiently. Failure with computers is a management failure. The computer just does what people tell it to do. Computers fly aeroplanes, win at chess against grandmasters and are part of our everyday life. Computers allow doctors to perform surgery by remote control. Computers made space-travel possible. Computers are now embedded into every facet of our life. In the middle of all this wonder and cleverness the question is; “How do we use this potential to
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increase the shareholder value in our business?” The philosophy developed in this book will show you how to keep your staff concentrating on your main strategies and ensure that you have less risk and more profit. The basic principles of managing computer installations have been the same over the last 30 years and they will be the same over the next 30 years. The technology is not the problem. We have always been working with the “bleeding edge” of technology. That is where the work is. When we know what to do we can have successful installations without any fuss. If we don’t understand the principles involved then we are in grave danger of producing a very visible catastrophe. This book should bring a smile to your face as you recall the situations you have seen in previous organisations and hopefully you will avoid the pitfalls that have befallen your predecessors. The first seven chapters will provide you with the basic philosophies and strategies necessary

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Since I wrote this, and only about three weeks later, IBM decided not to continue with the contract.

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to understand the place of Information Technology in the modern organisation. Read the chapters after that in any sequence and use them for reference when problems arise. They will provide you with “common sense” answers to the problems you will meet when dealing with the Information Technology industry. As we advance into the information age our organisations will become increasingly dependent on computers. Our computer strategy will determine success or failure. Our computers will assist our customers to deal with us. Rather than be a barrier they will form an essential part of the organisation and in some cases will be the determining factor that ensures success in the market place. Dell, which makes and sells PCs, has a business model that provides direct computer input from customers into the manufacturing cycle. They also provide direct computer attachment to their suppliers at the back end to ensure that these suppliers have the most up to date information

for providing the Just In Time service demanded. This very short “supply to manufacture to sell” chain has enabled Dell to become such a success in one of the most competitive industries in the world that they are crippling their opposition. Compaq and IBM have a major problem in trying to compete with this new model of the PC Supplier company. If they cannot compete they will have to get out of the business. Could this happen to you? It is not just a matter of putting something on the web. Dell’s competitors are doing that. Each company must attempt to redefine their business model to become unique and defeat the competition by that very uniqueness.

Scott’s Law 1: Your business strategy will inevitably become dependent on your Information Technology strategy.

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2. Case Study
I don’t have any solution, but I certainly admire the problem.
Ashleigh Brilliant

All they would need then is an efficient billing system and they had their systems problems solved. What did they do? This company went for Business Process ReEngineering. The company called in an international accounting firm and their Business Process Re-Engineering specialists went to work. They set up office in a big meeting room and examined every aspect of the company. This then enabled them to draw a “function work flow” diagram that covered all the walls from floor to ceiling. They must have produced more than 100 square metres of arrows and boxes. From this they developed a list of required functions and produced the Request For Proposal. This document is a complete set of
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A medium-sized company in New Zealand with a turnover of around $80m needed some new systems. Their current systems had been in place since the company was much smaller and were a hotchpotch of software running on different computers. This company installed and repaired expensive machinery at hundreds of sites around the country. Their problem was coordinating their emergency repair and scheduled maintenance so that their staff would travel the minimum distance. If they could solve this problem then they could offer the most efficient and costeffective service in the country. They would then be able to dominate their market.

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requirements for potential suppliers and must be produced accurately as it will form the basis of the legal contract between the company and its supplier. The cost was $350,000 and the document was a masterful effort. But they still had to find the solution and implement it. The responses arrived and a local firm was proposing to use an international job allocation system (let us call it IJAS) which included inventory and accounting packages. IJAS was the result of many years work by a well respected consulting firm using the best techniques from Operations Research.2 This would enable the user to calculate the least distance for service engineers to travel while still including the possibility of combining urgent repairs with standard maintenance. In addition, they combined this scientific approach with the latest technology for plotting positions on maps and showing the shortest
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route. The designers had installed it in a number of Fortune 500 companies who were in a similar line of business and it seemed the perfect answer. Price around $250,000. Add in the Financials for $100,000 and we have a worldbeating system for a total of $350,000 plus hardware, installation and training. Then what did they do. Some men are born mediocre, some men achieve mediocrity, and some men have mediocrity thrust upon them.
Joseph Heller (Author of Catch 22)

A scientific approach to management and decision making embodying many powerful mathematical techniques for problem resolution.

Having spent such a large sum on BPR the company decided that they could not afford this “Rolls-Royce - IJAS” solution. They accepted another inventory and financial software solution that was still in development and went on to connect the bits to run all the repair jobs and the scheduled maintenance as efficiently as they

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could. The costs started rising and the systems did not solve the real problem for them. They are still struggling with this software at a cost rising past $500,000 plus the expensive BPR exercise3. This was an expensive disaster they would have avoided had they understood the philosophy and strategies of this book. What they should have done. When we finally see the light, we see how once again we have fallen into some foolish assumption, some oafish practice, or some witless blunder.
Gerald M. Weinberg (Computer Guru from 1970s)

Advantage” in the market place. I discuss this more fully in the chapter “Why The Computer”. If the managers of this company had analysed their situation with this concept in mind they would have quickly seen that a superior system for scheduling jobs and staff would give them a Competitive Advantage. The most appropriate accounting system to install would then be a model of Operational Efficiency. This would have enabled them to see that their best strategy would be to search the world for the system that would keep their service superior to their competitors and thus continue to dominate their market. Having concentrated on this project they would then be able to use the accounting software that best fitted that choice. Most specialty packages interface to a variety of accounting packages. The other major error of judgement was to launch into a full scale Business Process ReEngineering project. Business Process Re-

The first thing to understand is that we have only two reasons for using computers in our business. They are for improving “Operational Efficiency” within our organisation or to gain “Competitive
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This case has since gone to court and the Solicitors’ fees will be rising to match.

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Engineering is a similar process to the one we called Systems Analysis in the 1960s and 70s when we applied this methodology to the whole company. We found that the problem was not with the methodology or the people doing it but just the sheer difficulty of changing a complete company. The solution is to have a strategy for the whole organisation but to only change one portion at a time. When people try to change a large organisation by redesigning processes from the ground up they imply new design and programming effort at a basic level. This implies that the company is unique and the only way to get effective solutions is to redesign the way the company does business. Then design the most suitable systems to go with the new business. This approach is difficult and costly. They should have ignored the Business Process Re-Engineering proposal and written a broad brush Request For Information. This would have

elicited the same responses as before from the same companies. This means they would have obtained the same proposals at a cost of around 10% of the Business Process Re-Engineering effort and they could then have afforded the best solution. They would have then been well ahead of any competition at a cost saving of $500,000.

Scott’s Law 2: Get the basic concepts right.

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3. Why The Computer
Humanity is acquiring all the right technology for all the wrong reasons.
R. Buckminster Fuller

continued with computers becoming integral parts of all business systems. Clearly we use computers to save money. As time passed from the middle part of this century to the 80s and 90s we begin to see another aspect to the use of computers. Companies that managed to use their computers well seemed to have an advantage over their competitors. Not only did they process information more efficiently but they seemed to be able offer more personal services to their customers. Letters to customers were individually addressed. Not only that but they also looked like individual letters. Systems were developed to remember dates and write to customers when, for instance, their car was due for servicing. Systems would keep track of customers’ purchases and offer bonuses and prizes when they reached certain levels of
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What are we trying to do with Information Technology? There must be a reason for owning computers and all that software. We spend millions and we don’t get value for money. How do we change this? How do you get control of the Information Technology part of your organisation and manage it for fun and profit? When we look back at the history of the computer we see that the reason for its growth in commercial use has been to process information faster and cheaper than before. The U.S. government started by using early machines to tabulate results from the census. This early success led to the use of similar machines in business for processing accounts. This has

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spending. This has now mushroomed into such things as “Talking Points” from Telecom and “Fly Buys” from a range of places. These services started to provide companies with an advantage over their competitors and so the competitors also had to provide similar inducements to customers. Now with PCs and the World Wide Web we are seeing more and more instances where organisations are using Information Technology to gain advantage over their competitors. Customers can now do “mail orders” directly online. Customers can be anywhere in the world. Some services and products can be sent directly down the telephone line at the time of ordering. In a few years music stores as we know them might disappear. Everybody will order their new CDs directly down the phone line and then make their own CD on their own $295 CD writer.

Maybe we won’t even bother making the CD as storage has become so cheap that we start storing our music directly in our home computer and connect the computer to the Hi Fi set. Maybe the computer is the Hi Fi set. When we examine the computer systems used by organisations we discover that they have only two purposes and these two purposes are: Operational Efficiency4 Competitive Advantage5 Operational Efficiency means to perform the mundane processing of data as efficiently and as cost effectively as possible. This means, for instance, sending out your invoices and statements efficiently and cost effectively, processing incoming orders quickly and cheaply. Filling forms and passing information only when

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So much of what we call management consists in making it difficult for people to work. - Peter Drucker You can fool too many of the people too much of the time. - James Thurber

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necessary and then quickly and cheaply. Use technology to reduce your costs. Competitive Advantage means to provide your organisation with an edge over the competition. If you can have a special sales order and invoicing system that enables you to provide a better service to your customers then that will hopefully increase your market share and your Rate of Return on Capital. If you can also get them to pay faster then you will again earn a better Rate of Return on Capital than your competitors. Combine your brainpower and technology to outsmart the competition. Ask your Information Systems Manager to provide you with a complete list of all the systems on all your computers listed under the two headings6: “Designed for Operational Efficiency”, “Designed for Competitive Advantage”.
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Next ask the following questions: • Are any systems not on these two lists? Put these on a third list. • Do you need the systems on the third list? For the Operational Efficiency systems ask: • Can any system be removed? Is each one really necessary? • Can any systems be combined? • Can any system be run more efficiently? • Can any system be run more cheaply? • Can they be replaced with something cheaper? • How can we reduce the cost of running all these that are left? • For the Competitive Advantage systems ask: • What is the competitive advantage? Is this real?
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Delay is the deadliest form of denial. - C. Northcote Parkinson

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• How can I change this system to obtain more advantage? • Is this list complete? • Are there any other possible systems that we need for Competitive Advantage? • Should some of the Operational Efficiency systems be in this list? And vice versa? This should give your managers something to work on. Then of course, whenever anyone proposes a new system, ask them which category they would put it in; “Operational Efficiency” or “Competitive Advantage”7. By organising your systems into these two categories you now have a means of judging how much time, effort and money to spend on any new systems. If the system is to gain Operational Efficiency then you should only spend money if the new system will save money. Never mind

about new technology. Make these systems cheaper and more cost effective than the existing ones or there is no point in making the change. This keeps your decision making process clear and simple. If the system is designed to provide you with a Competitive Advantage then you will undoubtedly have a more difficult task to determine how much the proposed system is worth and how much should be spent on it. Competitive Advantage type systems come in many guises and sometimes they may mean that your organisation may need considerable change as well to match the proposed system. The purpose of having this classification of systems is to concentrate management time on the main task. If the system is to improve efficiency then we are looking at the best price for the minimum required functionality. If you are looking for Competitive Advantage then you

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Less is more. - Mies van der Rohe

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will need to start with some top level creative and strategic thinking before you start to think in systems terms.

Scott’s Law 3: Any given system should either gain you Operational Efficiency or Competitive Advantage.

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4. Creative Computing
Think sideways!
Edward de Bono

the adventuring types ring up from the top of Everest or from the South Pole. There is a major trend to combine digital computing power with communications systems. Analogue systems are being replaced with digital systems. The early cellphones were all analogue but now as the digital cellphones develop wider coverage around the country their natural advantages of lightness, longevity, and multiple functionality will entice more people to shift to digital communications. The latest developments in TV technology are to provide us with a digital TV. The reason is that the digital signal arrives with no loss of information and so we always get perfect pictures. We can also pack more information into the signal and get a better quality picture with finer detail.

In the world of the future, computers will proliferate. We already have computers in our cars and washing machines. Serious manufacturers in the USA are talking about computers in toasters, dish washers, and spread around the home to help with a multitude of ordinary tasks. A large number of homes already have one, two or even three computers. All this computing power sits idle for most of the time. Communications systems are also developing rapidly. Homes often now have radio, television in three varieties (normal, satellite and cable), telephone with radio extensions, cell phone, fax and the ubiquitous computer hooked up to the internet. People can communicate anywhere in the world at any time. We are not surprised when

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Our music on Compact Disks is all digital. We can get more information and hence richer sound with digital signals rather than the old analogue vinyl platters. And, of course, they don’t wear out. Prices are plummeting and there is no end in sight. Do we follow along safe and secure, like the Whip Manufacturing Co., producing ever better buggy whips in the age of the motor car or do we charge to the front and bleed to death on the cutting edge of technology? Hopefully we can find a third way8. The Delphi Technique, described in this book, is a very useful tool in determining where our particular industry is moving to in the age of computers. However, to really make best use of this tool we need to open up our thinking to new possibilities and this is where we can make use of the ideas of Edward de Bono and really do some creative thinking.
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Our aim is to find a “best path” forward for our company. How can we increase our market share? What market are we in? Should we redefine ourselves to create our own market? We have been around the efficiency loop with TQM and Quality Circles. Now our competitors have also been through the efficiency mill and we are again competing head to head. Perhaps the answer lies in combining with a complementary organisation to find the synergy that will drive us forward. The world is now in the middle of yet another major merger round as oil companies and car manufacturers join forces in diminishing markets. A merger is very difficult between companies within the one country because differing cultures developed in each company make it very difficult for staff to work together. How much more difficult will it be for companies from different countries and different languages? Did you know that 70% of

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There ain’t no rules around here! We’re trying to accomplish something! - Thomas Edison

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all mergers failed to add value for the shareholders? I think we need a better than 30% chance of success so the merger idea should be discarded. After mergers and take-overs that were less than successful many companies have “gone back to the knitting”. That is, they have searched for their core competency and discarded the rest. The difficulty with this approach is that it puts us back in the same boat with all our old competitors. And, although that might be what we are good at, isn’t this just another run at being the best buggy whip maker? We must start with what we have and search for ways whereby we can add value for the customer. This may mean both dropping existing functions as well as developing new products and services. We should build a business model that makes products and services better, cheaper and more relevant for the customer. What we are

doing with this approach is to change and redefine our market so that we reduce our competition. We develop the whole organisation to work in the particular mode that enhances value for our customers. An example of this is Dell computing who have designed their business model around providing direct sales of computers to consumers. They have a system whereby any person on the internet can describe the functionality of the computer they want and place the order immediately for direct delivery within a day or two. The whole Dell organisation is geared to this method of operation9. The systems and people work in concert to achieve maximum value for the customer. Dell is now the fastest growing supplier of Personal Computers in the USA.
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Hewlett Packard now openly admit that that “Dell is forcing us to reorganise our whole sales end”. This is interesting because I think we would all acknowledge that Hewlett Packard is currently one of the most successful companies in America.

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Compaq are now trying to develop a similar model and impose it on their existing organisation structure. This is likely to be very difficult as they already have an existing business supplying mainly to companies rather than individuals. The chances of Compaq doing both jobs so well that they provide better individual service than Dell would seem to be small. It seems clear that if this model of Dell’s is forcing two hugely successful companies like Compaq and Hewlett Packard to revamp their businesses then it will be adopted by many other firms in completely different industries. In this new digital age we need to conceive and develop the model of our organisation that will maximise the value perceived by our customers.

This is defining our own particular market which has the effect of reducing our competition. We need all the functionality and perfection required and supplied by others but when combined with this value added model we can provide a unique and more valuable service. This will mean combining our business ideas with developing digital technology. The quest is to do this successfully.

Scott’s Law 4: Use creative thinking to develop your digital business model.

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5. Lateral Thinking
I am not prone to argue.
Mae West

Information Technology staff are often very creative people. They build systems from ideas and thin air. Where we have gone wrong so often in the past is to separate out the Information Technology whizz kids and leave them creating in isolation to the real business. Computers are now an integral part of society. They are not a magic thing apart. If we are to fully utilise their power in the interest of our organisation we need to bring all the brains of the staff to bear on their use. We need to have a common corporate goal. One way to help get different parts of the company working together is to develop multidisciplinary teams who are trained in the art and practice of Lateral Thinking10.
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Lateral Thinking is a new way of thinking and is not dependent on how much tertiary education we have had. People in Marketing and Advertising are often thought of as being creative and people in Accounts or Operations as being more logical. I am sure that some people are naturally more capable of thinking laterally just as some people are more logical but, just as we can teach the elements of logic and give everybody a base to work from, so we can teach the rudiments of Lateral Thinking to all. The world’s number one lateral thinker and the inventor of the expression is of course Edward de Bono. He has written a large number of books on the subject and they contain many ideas to help us learn some of the ways of thinking laterally and not logically. The reason we human beings have such trouble in thinking laterally is rooted in the very

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The significant problems we have cannot be solved at the same level of thinking with which we created them. - Albert Einstein.

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foundations of the mind. When we are born our brains are a clean slate. Just grey mush. What happens is that as we grow and experience the world around us the brain cells develop pathways that represent the patterns that we observe in life. Our vision is constantly comparing what we see with patterns stored in the brain. Sifting through memory searching for familiar patterns. This is how we learn to speak and recognise speech. Our brain11 is constantly sorting input to compare with existing patterns. This leads to our brains being very good at logical thinking, at recognising patterns within a problem and logically determining what we normally do when confronted with that particular pattern. This is why we find it difficult to change our habits. Old patterns die hard. Our brains work by recognising patterns and building quick short-cut routes through the brain’s pathways so that we

can perform most actions by rote. The pathway is fixed - this is always what we do in this circumstance and the body is already in motion before we realise what is happening. What we want to do is to change this lifetime habit and think the unthinkable12. Suspend judgement and consider stupid ideas in the hope that these will trigger off other ideas that may not be so stupid13. It is very difficult to change the habits of a lifetime, especially when these thoughts are so deeply ingrained and bound into what we are as the thinking animal. We will constantly revert to our old pattern recognising and judgemental self. The methods of lateral thinking are to generate ideas without using our critical and logical thinking mode of operation. They are means of thinking the unthinkable and making new
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What luck for rulers that men do not think. - Adolf Hitler Don’t talk to me about a man’s being able to talk sense. Everyone can talk sense. Can he talk nonsense? William Pitt the Elder.

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Brains are an asset, if you hide them. - Mae West

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illogical associations that our brain refuses to accept. An example of this is the approach that many people are now taking to business over the internet. For instance there are three young chaps in Israel who decided to provide a service over the net and they proposed to run their business by not charging for the service. Now how illogical is that? They conceived of an easier method of sending mail around the net. They needed $100,000 to start off but naturally the logical thinking venture capitalists would not front with the money without a well thought out plan. This plan needed budgets showing how the money would roll in. They managed to get this seed money from one of the parents and built their new software. People on the net liked what they saw and since it was free and easy to use they started using it. Of course each person they talked to could see the new idea and they too started to use this new

free software. Thousands of users became millions of users and the three entrepreneurs sold the company to one of the big net companies in the States for $187,000,000. After paying costs they had $60,000,000 each for their idea. Not bad for a plan to give their product away. So remember, the first rule is to suspend judgement. What we are aiming to do is to discover new ways of combining computer technology with our business acumen. One method of starting this thinking process is to state the opposite. That is, “We will not use computers in our business.” Do our cellphones have computer chips in them? Chuck them out. Do we use computers to bill our customers? Stop doing that! How could we run a successful business with no computers? Could we use someone else’s computer? If we could rearrange things to not use a computer would this make our

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customers love to use our services? Out of this thinking may come new insights into how your business could be run. Another method is to use random response words then use word association to chase ideas and concepts in the hope that we can trigger some useful thoughts. To do this we make a list of 60 words chosen at random. Just use common words like peach and knee and roads. Then choose the topic to discuss. In this case it might be, “How do we keep our existing customers”? We all know that it costs six times as much to get a new customer as to keep an existing one so let us save some money by keeping our customers. The meeting facilitator then asks one of the participants to look at the second hand of his watch and quote the number of seconds it shows. If he says 17 then we take the 17th word in our random word list and write it in big letters. Let us suppose the random word is “Petunia”. Word association then produces “flowers”,

“plants”, “fresh”, “nice smells”, “perfume”. This may encourage us to think of ways to keep our customers by supplying a flower for a button hole, or by putting fresh flowers in the store so that it smells nice, or perhaps use happy smelling paper to print out the invoices. The successful company of the future will be the one that defines its own market and the strategy to meet the needs of the market, and which then completely integrates all systems within the company so they are dedicated to that strategy. To achieve this we must have creative thinking from all the staff involved.

Scott’s Law 5: One original think is worth a thousand logical thoughts.

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6. Delphi Technique
The only limit to the realisation of tomorrow will be our doubts of today.
Franklin D. Roosevelt

The technique works like this: • Discuss this technique with your senior staff and explain that it will take a small amount of their time and the time of any of their staff whom they consider should be involved. Include any computer staff that express an interest in being involved. • Ask each person to write down their predictions for the future of your industry and also what changes they see happening in the
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The name springs from the “Delphic Oracle” of ancient Greece whose utterances were regarded as the words of Apollo, and who was consulted widely by private citizens and public officials14. The RAND Corporation was developed as an American think tank for Government in the 60’s to help them map out the future16. It developed a considerable reputation for its advanced thinking in a number of social, scientific and national arenas. To assist with the problems of trying to define the future and refine its details the RAND Corporation developed this technique which it christened the “Delphi Technique”.
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The town of Delphi become wealthy but unfortunately that made it a frequent target for attack over the years, including a raid by Gauls in 279 BC. After the Roman conquest of Greece, Delphi declined and much of its art and treasure was confiscated by the Romans. The oracle, however, continued until AD 390. The RAND Corporation was a United States research centre and think tank set up by the government in the 1960s to provide original thinking for problems largely associated with the “Cold War”. I never think of the future - it comes soon enough. Albert Einstein.

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computer industry. It should be done when they can find time to be more contemplative than normal. This is an individual lateral thinking exercise. • Take all these projections, combine similar ones and make two lists. One list for your industry’s future and one for computer technology. Write them out in the order in which they are likely to happen. • Provide both lists to all staff and ask them to combine the lists to indicate what effect technology will have in your industry in the future. • Collect all the finished lists and combine similar predictions together. This will give you a set of predictions for the future of computer technology within your industry. • Distribute the final list and ask everybody to write beside each prediction the date when they think it will happen. This is will provide some interesting results.

Average the dates across all the staff and publish the final predictions17. This is an effective means of getting your staff to make an assessment of where the future lies for the organisation. It is a consensus of everyone’s thoughts and since they are all involved they are buying into the next step - the Strategic Plan. When I first read about this plan I was working for Databank. Databank was a clearing house set up by the five trading banks of New Zealand and at that stage we had just completed the job of writing the main batch oriented software and were processing cheques overnight. This involved a nation-wide courier system for collecting and distributing cheques. These were collected in centres in Auckland, Wellington and Christchurch and processed through a big IBM machine (which had about 1% of the power that my PC now has). All the payments were made around the various bank accounts and the
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The trouble with our times is that the future is not what it used to be. - Paul Valery

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cheques were sent out again to the originating banks. This was a labour intensive and expensive business. We, at Databank and the founding banks, decided that we should be able to do better and we had to work out a way for the future. But, of course, what future? We established a small team to provide for a strategic plan for the board and decided to use the Delphi Technique. We approached all the staff of Databank who we thought might like to contribute and talked to the senior people of the banks. We got plenty of interest and we followed the steps above. I can tell you that this Delphi Technique had an uncanny ability to predict the future of the industry. Ten years later when I met my old boss in the street one day he told me that he had just recently found the old report we wrote and he was surprised to find that it read like a history of the previous ten years.

The plan had worked extremely well and was the foundation for a decade of success for what was one of the world’s most successful bank clearing houses.

Scott’s Law 6: Understand the future and drive towards it.

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7. Strategy and the Strategic Plan
Formula for success: Rise early, work hard, strike oil.
J. Paul Getty

advantage with this approach leads to your whole market segment becoming more efficient. You are on the treadmill with your competitors and you can’t hop off. The way to overcome this leap-frogging effect is to position your company differently from your competitors. You should do this, not by discovering your core competencies as we did in the past but rather by looking for other opportunities in the industry. An example of this is Telecom in New Zealand who are doing this by changing from being a provider of telephone services to become a provider of on-line services. This covers a broad range of communications systems and moves them into the realm of the World Wide Web. Telecom must then work to redefine the organisation in the new terms. Not only must the customer see the organisation in the new way but the company

In his recent book, On Competition, Michael Porter has upgraded his thinking in the chapter entitled, What Is Strategy? Here he describes the difference between operational effectiveness and strategic positioning. Operational effectiveness is to perform the same activities as your competitors, only better. This can be done by using such techniques as bench-marking, TQM and lean manufacturing. However such techniques lead to short-term advantages while your competitors catch up. You are still part of the same industry segment albeit more efficient than before. But of course all your competitors will also be racing to achieve the same efficiencies. Short term

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must see itself as a changed entity and realign all its systems for optimum efficiency in the new direction. This strategic approach emphasises that you must first conceive the business strategy, then develop the Information Technology strategy18. Again, looking at Dell we see that they have aligned their Competitive Advantage with their customer ordering system. Their Competitive Advantage is their customer ordering system. Their major strategic advantage is locked in with a system that provides maximum service and ease of use for their customers to order exactly the PC they want. In the future, companies will need to be lean and mean to compete with global competition and in addition they will need to have a clearly defined model of how they interact with their customers. This interaction will be systematised with computer technology to provide maximum
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service and cost-effectiveness for the customer. This is where the Delphi technique can be so useful. It will help you and your staff focus on the future and where your market is going and how future computer developments can be used to provide you with the competitive advantage that is essential for success in the long term. We used to say “First define your business strategy and then you will be able to develop a suitable computer strategy to enhance it”. Now we say “The model that you develop for your business operations of the future must incorporate business strategic thinking and the likely future of information technology at the same time”. That is “Your business is the sum total of its systems”.

Scott’s Law 7: Your strategy is to define your market so that you have no competition.

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A little uncertainty is good for everyone. - Henry Kissinger.

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8. Shareholder Value Added
The way to make money is to buy when blood is running on the street.
John D Rockefeller

Shareholder Value or Return On Investment is what it is all about. Your computer people (oops sorry; Information Technologists) just love the latest technology. “Change and challenge is where it’s at, man.” Remember that your job is to maximise the company’s return on its capital19. Computers have only two purposes: Operational Efficiency: Provide cheaper, or more cost-effective ways of working within the company. Can we get our invoices out faster? Can we do the paper-work faster and cheaper? Will new technology reduce staff costs?

Competitive Advantage: Use new technologies to provide new services better and faster than your competition. Will a new system give us a competitive advantage? If we provide the airline booking system will our planes appear first on the list? Should we use the Internet to gain more customers more cheaply? Projects should show an eighteen month payback period or better. If the computer person has to show you a ten year time horizon to get some return on capital then forget it. He doesn’t even know what he will be selling next year. In 1987 a Local Body installed the latest modern Financial Management System. Fully integrated, it had features like a commitments system which displayed intended purchases in the General Ledger then automatically transferred them out of commitments and into liabilities when the

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Too much of a good thing is simply wonderful. Liberace (American pianist)

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purchase order was printed. The system cost around $1m to install on their current hardware and to train their staff. Incidentally, it was fully Y2K compliant. In 1997 the same organisation on the advice of their technical people and a large accounting firm did the same thing again, but this time they spent $7m. In functional terms the new Financial Management System would not give them any particular advantage over the old system. Why do people spend $7m for no clear advantage? Perhaps it doesn’t matter when it is other people’s money. However, in the real world where competitors are either racing ahead or catching up fast we can’t afford such luxuries as emotional decisions. The solution is to classify all systems

into either “Operational Efficiency” or “Competitive Advantage” types then we will quickly see where to spend our money to best effect and where to squeeze for minimum costs.

Scott’s Law 8: Increase shareholder value by seeking operational efficiency and competitive advantage from your systems.

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9. Computer Staff
I do not want people to be agreeable, as it saves me the trouble of liking them.
Jane Austen

Computer staff are expensive. They also have a reputation for being more interested in the technology than in your business. You certainly don’t want to be funding a bunch of nerds to do clever and useless things with your computers. Information Technology managers, like all department heads, want to make sure that they have an expanding empire over which they have undisputed control. The question is: “How can you control the costs of this burgeoning empire?” You may decide that the answer lies in handing this problem to someone else. This is known as Facilities Management and certainly solves the problem of managing your staff. However, it

may be a more expensive solution than managing the Information Technology yourself. There is also the problem with Facilities Management that the external company may not be responsive enough when you need new solutions to keep ahead of the competition. As we discussed in the chapter, Why The Computer?, organisations have two types of systems. The first type is concerned with reducing costs and is suitable for Facilities Management. The other type, where you hope to gain competitive advantage in the market place, may require that you have a team of computer whiz kids that you have under close control. The question to resolve is how do you tell the difference between these two types of systems and how do you manage the various options to give you maximum flexibility and competitiveness combined with minimum costs.

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How can you manage your systems and not have staff problems? You can do this by hiring a competent Information Technology Director who reports directly to you and who has no staff20. The job is to ensure that all your people have suitable systems available to them so that they can do their job with the maximum of efficiency. Calls for new systems are placed before this person and following the tenets of this book they are assessed on their merits. Senior staff meet with the Information Technology Director once a month in a systems steering committee and decide the merits of each proposal and the order of importance. Important ones get done first. When people get used to this idea the meeting will take less than one hour a month. Hold the meeting standing up and it takes 15 minutes.
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All costs for each system come from the budgets of the using departments. This means that you do not have an Information Technology department with a budget for distributing. It means that users must decide whether they will get a financial reward for their investment. This way you only spend what is necessary. If a new system is required then it will be supplied by outside contractors. There are three ways of doing this: A Systems Integrator can be retained to perform the installation and ongoing maintenance and running of the chosen product, You can choose the product and tender out its day-to-day running, You can choose the product, which is then installed by the supplier, and your staff run it as part of their normal job.

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It may be that the Information Technology Director does have a few staff working and building the systems necessary to gain Competitive Advantage. Their knowledge and skill will be part of your advantage.

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The Information Technology Director is responsible for ensuring that all this is achieved at the least possible cost. No empires, maximum visibility and total responsibility. Combine this with the strategies set out in this book and you have a winning formula. Senior management ensure that their staff can concentrate their energies on the areas of the business that will give you Competitive Advantage and the other parts are run as efficiently and cheaply as possible.

Scott’s Law 9: The fewer Information Technologists on your staff the better.
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10. Consultants
Real knowledge is to know the extent of one’s ignorance.
Confucius

Consultants must supply more than just advice they must see the job through to its natural conclusion. Then they have earned their fee. Use consultants if they can improve shareholder value or your Return On Investment (including their fees). Get a quote in advance, or better still, agree a deal where they are paid some percentage of the result they produce22. For instance, suppose your Information Technology budget is $1,000,000 per annum for your current level of operational efficiency. Why not pay your consultant 25% of all savings made? If your costs come down by $500,000 then the fee of $125,000 will be worthwhile. If your savings are only $100,000 then the fee is only $25,000 but you might as well add $75,000 to your profit for the year. This arrangement might be on a permanent basis where the
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We’ve all heard the old joke that a consultant is a person who borrows your watch to tell you the time - and then walks off with the watch. Seriously though, we often need experienced and sound advice but where can we find it? Many computer people call themselves consultants but they are often either contractors with a particular expertise to sell or else they turn out to be salespeople who sell you services that their company provides. Consultants21 are people who can apply their experience and intelligence to make a difference to your company results. Their advice should be without bias or any possibility of bias.
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Talk low, talk slow and don’t say too much. - John Wayne

We’re overpaying him, but he’s worth it. - Samuel Goldwyn

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consultant earns his keep by continually reducing your costs or it could be a one off arrangement where the consultant makes significant cost savings and the fee continues for five years. The rationale being that it takes a year for the savings to start coming through into the balance sheet, they build up for two or three years and then other influencing factors start to be more significant. On the other side of the ledger, when looking for Competitive Advantage, why not offer the consultant a percentage of increased profits. It will take more effort to find a workable formula but if the new ideas and systems do not improve the bottom line then you pay the consultant nothing. This would be a good test of the consultant’s convictions. Many modern companies provide major incentives, such as stock options, for the management team to succeed. Your consultant is part of the top team and should be rewarded the same way. It would

certainly test their convictions if their daily rate was reduced and they received a results oriented package. Payment by results - the new incentive package for consultants. Most consulting firms in the Information Technology arena are really collections of contractors. The company principals have an array of contractors in their employment or on their books for whom they must find work. They also have sales staff who must be paid. They sell your company on the latest technology and you get to do the paying. That is, the consulting firm will give advice that leads to more work for their staff. Some “consulting” firms (and this includes some of the international major accounting firms) even supply software to go with their advice and of course they supply the staff to install that software. When their sales staff come calling be

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aware that you are buying contractors, not consultants. When you first meet a consultant you will need to find some common ground where the consultant can be of use. If you decide to use consulting services start with a definite job for a definite result and for a definite quote. Most consultants will make an initial offer to show their mettle which will allow you to judge their usefulness to your firm for a small start-up fee. To ensure that you are getting absolutely independent advice from your consultant you should assure him or her that you will not employ the services of any other person from their firm23. If their advice convinces you and your team to move forward with a new project then the staffing for this project must come from your staff and other suitable third parties. This

way you will know that they are not biased in favour of supplying what their firm sells.

Scott’s Law 10: Your consultant must give advice without bias.

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In our case study (on page 5) the accounting firm who acted as consultants proposed the use of their junior staff to do the BPR study.

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11. Contractors
A specialist is one who knows everything about something and nothing about anything else.
Ambrose Pierce (1842-1914)

These are people with clearly definable expertise that you can employ at a fixed rate per hour. Only employ them when you have determined that you need their defined expertise24. Make every effort to employ these people on a fixed price quote for a completed job. Hourly rates go on forever. Many contractors call themselves consultants. They do this because it sounds more important, and they can charge more. A real consultant can tell the difference between a contactor and a consultant and so can you. The
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contractor offers expert services for an hourly fee - the consultant will offer to help you improve your Return On Investment. A real consultant can also tell the difference between a competent contractor and the not-so-good or even the downright incompetent. Only the mediocre are always at their best.
Jean Giraudoux

Did you know that tests on programmers show that the best are 20 times better than the average and the worst will never complete your job. When you need contract programmers, seek the best and pay them 20% or 50% more because not only will they produce the desired result, they will produce it in a fraction of the time taken by the average. (See Chapter 25 Programmers).

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Don’t ask the barber if you need a haircut. - Daniel S Greenberg - American writer.

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Don’t forget, organise your project so that you can obtain a fixed price quote for your programming work.

Scott’s Law 11: Pay your contractors for results not hours.

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12. Common Sense
The difference between genius and stupidity is that genius has its limits.
Albert Einstein

Common sense - a most uncommon thing. This book is about common sense. Some years ago one of our top 20 companies hired a computer hardware chap as the new computer manager. He surveyed the computer technology at the time and decided that Honeywell produced the best hardware for the price he wanted to spend. He ordered the hardware and then looked for the appropriate software for it. Packages of the day didn’t quite fit so he decided to write new accounting software. Needless to say, even with the best will in the world and highly talented staff, he found that money was draining away and the project just kept extending. He resigned.

Another DP25 manager put his senior data entry woman in charge of the operators who loaded tapes and disks onto the “mainframe”. She was also required to allocate the work flow through the computer. This, of course, made her unhappy because she didn’t know what to do and the computer operators ignored her. I relieved her of that duty (at no change in her remuneration) and put the best operator in charge. Everything went splendidly after that and she repaid me by removing one of the trouble makers in her department and doing the same work with one less staff member. Plain common sense. The brain is as strong as its weakest think.
Eleanor Doan

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Data Processing: The old-fashioned term for Information Systems or Information Technology

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Another Information Technology Manager developed a new system for collecting membership fees. After 18 months he was under considerable pressure to get the system up and running. After all, the General Manager had to justify the expense of the new machine that was not doing much. He therefore launched forth with a system that was not yet finished. Senior management pressure was too much for this gentle soul. (He was really a programmer at heart.) The system was not finished and not properly tested - of course the books did not balance and each week more things went wrong. This disaster confounded management as they had 120,000 members and they weren’t sure who had paid and who had not. We managed to fix the problem. Fortunately I had a first-rate team who designed, built and implemented a new system in a new language in six months. It is still working today more than 16 years later. Now here is the common sense bit. Balancing the money was quite a problem. The auditor

suggested that we should write a program to run through all the records and determine their status and correct each one. He didn’t seem to appreciate the magnitude of that task. It would have been a complex program and testing it thoroughly would have been a costly undertaking. The solution to this problem was the old principle of divide and conquer. We used easily developed programs to search the file for different categories of the members. Each pass of the file produced a set of records that we could fix with a quickly written program as they all had the same problem. When we had reduced the remaining file to under 10,000 difficult cases we set them aside and a team of three people fixed them by hand in two or three weeks. The most recent case to come to the public’s attention is from the New Zealand Police force. During the fiasco of their multi-million dollar argument with IBM it has been revealed that they have a missing persons system. This system
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now exists on the old police computer and also on the new one. They have now accumulated 25,000 names of missing people which should be very useful. Unfortunately they have a system for putting names onto the list, but they do not have a system for taking names off the list. The list has been growing for years and is full of “non-missing” persons. To hear the police spokesperson explain this to an interviewer was a delight of politically correct info-babble. At no stage did he intimate that they were working out a system to remove names. How could anyone put such a system into practice? I have just been involved in the aftermath of another multi-million dollar fiasco where the senior managers (including the CEO) were forced to resign. This problem occurred with a Government organisation that spent $9m developing new software and ended up with nothing working. It created front page news at the time and “questions were asked in the house”.

The new Information Technology manager immediately abandoned the project and set about sourcing suitable packages from around the world. He used the methods explained in the Request For Information and Request For Proposal chapters and found what was required. The software packages have since been installed and are running successfully. Common sense is not always obvious. When hiring programmers it would seem to be common sense to pay the industry average or a bit more for a good programmer. However, when you know that the best programmer can work 20 times faster than the average and do it better, it may be cheaper to pay the very best person twice as much as the average.

Scott’s Law 12: Common sense is hard to find26.
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Against logic there is no armour like ignorance. Laurence J Peter.

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13. Critical Success Factors
We don’t know a millionth of one percent about anything.
Thomas Edison

Bite-sized Chunks Keep the expected duration of each project to less than six months. If you have a longer-term goal then break it down to size. Make it a series of “Six Month” projects, each clearly definable and with a measurable result27. Use A Consultant Have a competent professional consultant in charge. Ensure that your consultant is managing the project or has advised on providing a competent project manager. Inquire About Progress Take a keen interest in all the milestones on the project plan. This may be the most critical of all factors. Projects tend to go well where the CEO has a keen interest in progress. Too many chief executives have in the past fobbed off this area
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To achieve success in your periodic forays into the Information Technology industry there are five essential factors to consider. There is, of course, a multitude of minor factors that impinge on the project but consider some basic ones carefully before you commit your hard-earned dollars. Your Goal Know what you want to achieve in business terms. Are you aiming at Operational Efficiency to reduce costs, reduce staff or replace machines that have a high maintenance cost? Or are you aiming at Competitive Advantage where you might be developing an innovative scheme that makes it easier for your customers to do business with you?

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We learn from experience that men never learn from experience.- George Bernard Shaw

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of their company to the accounting division. This is fine when the company has decided to install a particular Accounts Payable package and the accounting staff are charged with the responsibility of implementing it. But even where a particular implementation has been delegated you must still display that keen interest. Be Results Oriented Pay for results when they are achieved. In one particular organisation the steering committee decided that the General Manager could manage the project without professional assistance. In the end the Australian contractors they hired had done 80% of each required function but nothing could be implemented because nothing was finished. The contractors had been paid more than had been budgeted and were demanding considerably more to complete the job. A classic error of judgement. If the General Manager had only paid for each working

function then you can bet your boots that some of the partly completed jobs would have been finished and implemented. It is better to have the basic version running than the super version almost running.

Scott’s Law 13: You, the Chief Executive, make the difference.

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14. Customers
A satisfied Customer? We should have him stuffed.
Basil Fawlty

two sorts; the systems that must be just as efficient as possible and the other type that give you competitive advantage. This second type relates to your customers. You can gain competitive advantage by having systems that make it easier for customers to do business with you. For instance, you could have a friendly Order Entry system that adjusts to the customer’s way of doing things. You might like to consider accepting orders over the Internet for example. If these systems can provide additional advantage for your customers then use them. Make your customers LOVE your systems. For instance, if your customers are looking for used cars then offer them the Internet with a search engine revved up to find exactly what you are looking for, anywhere in the country?

This is the name of the game. Your whole company is dedicated to serving customers. I am sure you have computer systems that communicate with them. When your customers receive your computer’s output are they impressed? Are they annoyed? Are they even distressed? Do your customers perceive added value in using your systems? Two days ago one organisation sent out a bill for two cents (2c). This made news in the paper which was certainly not good publicity. Maybe your systems are better. If you read the chapter, Return On Investment, you will see that I have categorised systems into

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Can you think of any computer systems that you meet that impress you and make you want to see more of that company? What about systems that make you cringe and want to avoid that company? How about the company with complicated and detailed statements designed for their accounting staff but which are impossible for you to understand? What about using the systems in your company? Do you find them friendly and easy to use? Will this help your staff relate to your customers? There is no panacea but this is a fruitful area for your best people to be involved. Try some blue sky thinking to generate ideas to make your

customers love to use your services. Try Edward de Bono’s ideas for lateral thinking. We are seeing many spin-offs from the internet concept. Where does this lead and what will follow?

Scott’s Law 14: To understand your company, become a customer.

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15. Daily Operating Control (DOC)
Carpe Deim28 If you manage your business on a monthly basis then it will take months to discover that things are going wrong and more months to fix any problem. Far better to have weekly reporting to speed up this process. How much better then, if you can get results out each day. If your basic systems are operating efficiently and effectively then by the end of the day all that day’s transactions will be assimilated. This means that your computer should be able to tell you in a friendly fashion each evening that your business has had a good day and you can sleep easy that night. A customer of mine in a competitive industry had a Daily Operating Control (DOC) as standard procedure. When we built him a new computer system we provided a “snapshot” of
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the General Ledger which gave the CEO a precise set of measures about his business. We provided such measures as: sales that day, salesto-date by week and month, costs incurred, cash in bank, accounts receivable position, debtors and the number of staff. Numbers that were easy to understand and everyone knew that the CEO looked at these numbers every day. The CEO became rich and successful. If each day is progressing as expected then each week will be successful and the monthly reports to the board will be a pleasure to read. Carpe Diem - Seize the day and control it. Therein lies your future.
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Scott’s Law 15: Have a DOC today.

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Seize the day.

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16. Data Warehousing
Add little to little and there will be a big pile.
Ovid

We now have the technology to keep track of all sorts of information to do with our business. Modern systems are designed to keep track of all transactions that flow through your systems. This data is kept in the computer system so your staff can use it to answer customer queries, look up order information from suppliers and so on. This information can be kept on your computer for months or years and so provide a base of data from which you can derive information about your customers’ buying habits, your suppliers’ average delivery times and so forth. All this collection of data can be termed your data warehouse. With older systems this data was not always kept on the computer and would be dumped to tape

and archived so that it was difficult to get back and analyse. This led to the idea of a separate data warehouse which would hold all this transaction data and be used for studies into various aspects of the business. With very large corporations such as the Fortune 500 an additional complication was that different divisions and other parts of the organisation would have different computer systems. Hence the job of constructing a data warehouse was much more complicated than simply selecting data to shift onto the data warehouse computer. For instance the same customer might exist on five different systems. To understand his needs of your organisation we would have to match the differing customer numbers and other data elements so that we could pull the data together. This would require considerable analysis time and expense.

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Fortunately most companies are much smaller than the Fortune 500 companies and won’t have the problem of dealing with such vast arrays of data. For instance, Telecom keeps the basic information about every phone call in the country - on-line for three months and in separate storage for many more months. This data is kept in detail and can be used to reconstruct invoices if necessary. This is not a complex example of a data warehouse as the data stored is just what the main system produces. The only problem is to find a computer with a suitable database for holding terabytes of data at a reasonable price. Another example from a few years ago was a company in the USA who had a very old General Ledger system that had few and primitive reporting features. Rather than go to the expense of installing a new “state of the art” General Ledger with the attendant training problems and disruption to normal business they constructed a data warehouse from the General Ledger data.

They could then use more sophisticated reporting tools to obtain the information they required. This is the concept of data warehousing29. Not only is the technology available to deal with these terabytes of information but the cost of doing so has been dramatically reduced. It is now quite feasible to keep every scrap of information that passes through the company’s computers in these vast storage areas. The question is; “What is the point”? We normally keep a few months worth of data in case something goes wrong with our systems and we need to reconstruct our current position but data warehousing goes beyond this and holds years of transaction data. Is this data useful information or is it just one more way to spend our hard earned money on even more disk space? It is not possible to answer this question by the normal logical means of systems analysis. We
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Data expands to fill the space available - with apologies to Northcote G. Parkinson

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don’t know why we want to hold all this once vital information. It is just that we can, so maybe we should. For this reason it is pointless undertaking studies to determine what should go into the data warehouse. Just store the lot. Storage is cheap and analysis time is very expensive. Start with only one system such as the one holding your customer information and work with that. Then look on this question as an opportunity to engage in some creative thinking about your business. The sort of thinking that Edward De Bono exhorts us to use to create better organisations. Keep this data for a while and then start up a creative project team to examine the data and use creative thinking techniques to develop uses for it. What can we learn when we run trend analyses? Does this information give us new insights into our customers? Will this help us to prepare for the future?

If your team will take this creative step then it is possible that new concepts and ideas will arise. If this approach looks promising then ask the project team to do a cost-benefit analysis on using this data warehouse. If there are measurable benefits then look at refining the process and extending it to other systems. If the benefits do not out-weigh the costs and you cannot gain new insights from studies of the data in the warehouse then it is not worth keeping all that historical data. Either we can learn and grow from the information contained in the data warehouse or we don’t need one30.

Scott’s Law 16: Data, Data everywhere and all the thoughts did shrink; Data, Data everywhere and not a thought to think.
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We must learn to refrain from doing things merely because we know how to do them. - Sir Theodore Fox, British medical journalist.

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17. E-business
Time and tide wait for no man.
Shakespeare

Microsoft were so busy concentrating on their Windows operating system that they nearly missed the Internet market. The only way they could compete with the Netscape browser was to build something similar and to give it away free with every operating system they sold. This is hardly profitable business, but Microsoft realised that the Internet is all about obtaining and retaining the millions of fickle browsers cruising around the net. This has led to Microsoft being charged by the Justice Department of the USA with using its monopoly position to put Netscape out of business. Microsoft understood the potential of the E-business and dramatically altered its operation to take advantage while it could.

Dell computers understand the E-business from the user end. They have successfully built the internet into both ends of their business. Their customers use the net to order exactly the PC they want and to track its progress. Dell’s suppliers use the net to examine Dell’s systems and understand how to supply exactly what is needed just in time for the assembly process to produce the customer’s PC. No waste time. No excess inventory. Minimum costs. Maximum sales. Compaq, Hewlett Packard and IBM are worried. We have to become E-businesses or lose business to our competitors. Amazon started selling books and was so successful that Barnes and Noble, the largest group of bookshops in America, had to also set up a web site and sell over the internet. It didn’t matter that Amazon wasn’t making a profit. Their “net model” was so powerful that they could dominate the market

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inside two years and threaten the biggest, brightest and most profitable company in the business. Many businesses have just finished major exercises into Enterprise Resource Planning (ERP). As the lead up to the Y2K problems many companies installed new ERP systems to obtain more control of their business. This is just the beginning as Dell, Compaq, Hewlett Packard and IBM are discovering. We must use the ERP system as the base to provide customers and suppliers with information over the net. Easy ordering and simple order tracking - front and back - will become the standard approach for successful companies. Creative thinking is required. How will the Internet affect the business? Our Internet strategy will shape our business. Our business strategy will shape our systems. The best method I have found to map out the future is the Delphi technique described earlier. After all the efforts

we have put into our systems over the past decades we discover that we are now only at the beginning of the new information age. We must press on.

Scott’s Law 17: All business will soon be E-business.

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18. Facilities Management (Outsorcery31)
Are you sure it’s safe?
William Palmer, Condemned murderer, upon mounting the gallows.

This is when you have despaired of ever managing your computer department and pay a fee for someone else to do it for you. Facilities Management is usually a high cost alternative and admission of defeat. Normally the Facilities Management company will take over the complete Information Technology department and run it more efficiently but still provide you with the same service. The secret is to understand the difference between systems that provide operational efficiency and those that provide competitive advantage. Some systems providing operational efficiency could well be out-sourced if that reduces your costs. If you wish to obtain

competitive advantage in the market place then systems that help you achieve this aim must be part of company thinking and development. This concept of the competitive advantage system is central to the thinking of new-age companies such as Dell Computers. Their customer interaction system is the core of the company. The use of the World Wide Web can only enhance the use of this type of system. As competitive pressures increase on a world wide scale there may be advantages for a company to out-source some of its operations. Japanese car manufacturers have successfully out-sourced the manufacturing of various components and have used Just In Time systems to ensure delivery of quality components in time for the assembly line. So too, you can out-source
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Facilities Management was known for a while as “OutSourcing”, hence “Outsorcery” by those managers who had become doubtful of the claimed benefits

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some aspects of your Information Technology systems. Divide your systems in the two types; operational efficiency versus competitive advantage. All the operational efficiency types should be run as cheaply and efficiently as possible. Facilities Management may well be an answer in running these systems more cheaply. The competitive advantage systems however, are to be viewed differently. These systems are what can or will provide you with advantage over your competitors and hence they must be closely and continually aligned with the thinking of your management team. This suggests that the company strategic thinkers and your system developers must be closely aligned in their thinking. This does not mean that any system development must be done by in-house programmers. It means that you should have a systems architect available to your management team to assist with the strategic development.

You can still contract out portions of your new developments as and when appropriate. Out-sourcing may be a useful mechanism for when you need to make extensive changes in a large organisation. Someone else guarantees to do the Operational Efficiency type work for a good price and you can relieve yourself of the burden of a lot of technical staff who only seem interested in promoting expensive new technology. Then you and your senior staff may be able to concentrate on finding the means to use computer technology for Competitive Advantage.

Scott’s Law 18: Competitive Advantage systems should not be out-sourced.

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1 9 . G o b b l e - d e - G o o k32
Wise men talk because they have something to say. Fools talk because they have to say something.
Plato (c. 400BC)

I wish that people who have trouble communicating would just shut up.
Tom Lehrer

Information Technology, in common with most specialist activities, has a language of its own for conveying precise meanings amongst the cognoscenti33. The real expert who needs to explain his subject to an intelligent person can always do so using common English. The person who is extolling the virtues of SQL Windows with object-oriented, extensible, multiplatform, multi-threading, multi-tasking, totally distributed, open, integrated, ODBC-compliant, OLE-enabled system in a manner that you can’t understand is a Gook going Gobble Gobble.

Experts can explain their specialty clearly - con artists hide behind their buzz words. I have just read about the case of the German con artist who picked up enough jargon from his two girlfriends to bluff his way as a clinical psychologist. He reduced his diagnoses to two possibilities; if the patient was shy, sleepy or reluctant to speak then he had a “lightly autistic psychosis” and more lively ones were suffering from “active psychosis of a schizophrenic nature”.
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“He can compress the most words into the smallest idea of any man I ever met.” - Abraham Lincoln

I have come across many technical “experts” who use terms incorrectly. For instance, just in the last month I have talked to one analyst who was not sure of the difference between parameters, flags and codes. Another Business Analyst who used the terms “Purging” and “Archiving” as if they meant the same thing. “Archiving” saves your data and “purging” deletes it for ever. A vast difference.

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He became chief neurologist and psychiatrist at a big regional hospital near Colditz. He built up such a reputation that he was tipped for a chair in neurology. He was eventually rumbled by accident and faces a year in jail. We had Milan Brych who fooled the oncologists in Auckland for a couple of years. I have always found that an expert in some subject is able to explain what he means in my language so that I can understand what he is saying. Stephen Hawking talks about the most abstruse subject of all, cosmology - the origin of the stars, but he can still make it intelligible to the average person. You are an intelligent person. If you don’t have a clear understanding of what your consultant is talking about, then that will be your consultant’s fault - not yours. Do not be afraid to ask what you suspect is an ignorant question. Of course you will be ignorant of much information about computers. This is only to be expected. If your adviser (or

the salesperson) cannot answer your question then he has the problem not you. I once tried to make this point with a class of Honours students at the local University. I had a “Gobble-de-Gook” maker provided by one of the computer manufacturers that consisted of three lists of phrases. When you used any phrase from the first list with any phrase from the second list and added any phrase from the third list you got a really learned sounding sentence. I started the lecture with this “buzz word generator” in my hand like a set of notes and launched forth with three minutes of extremely impressive rubbish. I myself was immensely impressed, especially when I could see that half the class were taking notes furiously34. Because I was a serious ‘outside’ speaker they listened to the words and thought that they must
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Everybody gets so much information all day long that they lose their common sense. - Gertrude Stein, American Writer.

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make sense. They assumed that I was talking sense and that they just hadn’t quite got the gist of it. They seemed rather unimpressed when I explained my little experiment to them. But, just maybe, one of those students has listened to a computer salesperson and remembered me. Who knows, I might have saved him millions.

Scott’s Law 19: If you can’t understand him ignore him.

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20. How Much Do I Spend?
We’re overpaying him, but he’s worth it.
Samuel Goldwyn

In the early days when corporations were running large mainframes, studies were done about how much different organisations in the different industrial sectors were spending on computer equipment, software and on their Information Technology department as a percentage of their turnover. It was also common for managers to compare themselves with this number and to feel comforted if they were spending a similar amount. When I was running the Information Technology department for an oil company I was asked what we should be spending on Information Technology. The industry average in USA at that

time was around two or three percent of turnover. The company were spending 0.8% when I arrived and was struggling to get their payroll out in time. They were unable to make any progress with new systems and the Information Technology manager was barricading himself in35 to avoid the angry remarks from his users. After one year of new management everything was running smoothly and, I am pleased to say, with no change in the costs. It still only cost roughly 0.8% of turnover to do things properly. Spending the industry average would only have been a waste of money. Why everybody was wanting to be like the industry average I could never understand. I want systems to be cheaper overall and yet
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I am not kidding. He had just finished building a new wall with a grille between his area in the building and the rest of the company. Information was passed between his computer people and the users through this grille.

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produce financial results that are above the industry average. Why would we aim to be average? You will recall that in this book that I divide computer systems into two groups; Operational Efficiency types and Competitive Advantage types. This exercise enables us to reduce costs at the same time as we exert effort and spend money to surpass the competition. “How much money should we spend?” For systems aimed at Operational Efficiency the answer is “As little as possible”. For the Competitive Advantage systems the answer is “Sufficient to get the edge on the competition and to keep it”.

Scott’s Law 20: Spend as little as possible and as much as necessary.

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21. Interfaces
Ideas are one thing, and what happens is another.
John Cage (American musician)

and comes supplied with standard software for connecting to the other machines. If you are wanting to connect to your bank this is a simple matter. The bank will send your statement information to your PC and even give you some software to use. This is a simple file transfer and can be used for many jobs. If you have a large mail-out problem then just have your computer produce the file of letters and send them to a mail house. If you want to use an outside organisation to collect your mail and deal with all payments then this is a similar job. They collect the details and bank your cheques then send your machine a file of transactions that it can then use to update your files. With these file transfer jobs the only work needed is to ensure that both parties agree on the same file layout. There is not a timing problem as long as the file arrives at some stage so that it
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An interface in Information Technology jargon is described as the connection between two different computers. This is to include the hardware and the software. These days with outsourcing jobs like mailing letters and collecting accounts we will often find that we need to interface our computer to another computer in a different organisation that may even be in a different part of the country. We also have the internet connection and some times we may have on-line machines that need to communicate to our main computer to get answers for customers. This complexity can lead to problems. Fortunately, the hardware now works to standards, is bought cheaply over the counter

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can be processed. Even the next day is usually not a problem. Other interfaces, such as the internet, are supplied as a standard set of hardware and software and you simply choose the one that suits (the cheapest), install it and pay for it. Sometimes however, the world is not so simple. A certain large overseas software house specialises in providing warehouse inventory management systems that do everything to manage your stock and your warehouse. They have standard interfaces that need to connect to your computer so that they can do such jobs as price the stock as it is dispatched and print an invoice for the customer. Some jobs require that they get a response back from your computer immediately. One organisation where they tried to install this software had such a problem getting this interface to work that they were forced to abandon the project.

The problem was that the question of immediacy was not properly understood. The designers thought that it meant that they must use one machine to interrupt the other to ask the question and get the answer back. Because there were about a dozen different cases where this could happen they ended up with a very complicated muddle trying to keep both machines synchronised. If we understand that machines work very fast and that they can juggle an enormous amount of data in one second we can understand that what we as humans mean by immediately is actually a long time to a computer. If we want the machines to communicate within a few seconds then we have plenty of time since the computers can read and write hundreds of records and make thousands of calculations in this time. The solution to the warehousing problem was to have a third machine in the middle. This computer contained a series of files and both

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computers sent records to the proper file so that we developed a database of all records they needed to send. The computers also scanned this database to see if it contained any records that they wanted. This meant that each computer worked independently, sending records when its application dictated and continually looping around looking for the records that were meant for it. This loop could be adjusted in time to provide the best result. This approach meant that the main-frame could talk easily to a modern Unix box. Each worked in its own way and the result was a very happy client. Of course the middle computer was a Unix box and we didn’t actually use a separate computer, we just used a separate part of the Unix machine. It was getting the concept for this interface that was the important part. This concept is now the standard method used by the warehousing software company.

Interfaces can be standard and cheap or very tricky. Not all Information Technology people know the difference.

Scott’s Law 21: Some interfaces can be tricky.

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22. Just In Time Knowledge Workers
Life is short. Live it up.
Nikita Kruschev

Solve the muddle management problem by hiring just who you want just when you need them. During this century, as the industrial age developed to its full potential, we made major efforts to bring down the cost of manufactured goods. Our assembly lines developed with the use of robots and our costs reduced further by using external manufacturers to make some of the items and sub-assemblies. So that, when we build a car these days the whole process is automated and the car options can be programmed in at the beginning of the process to meet the customer’s order. This process works smoothly provided all the bits arrive at the factory in time to move to the assembly line. If

they arrive too early we have increased inventory costs of storage and management. If they arrive too late then the assembly line is slowed down or stopped till they arrive. If they arrive “Just In Time” then this will minimise costs. If your business development is planned to the same extent then you could employ “Just In Time” computer contractors to provide the technical skills for each particular task. We are fortunate these days that there is a plentiful supply of contractors either working on their own account or through an agency. This provides us with a pool of skilled people at rates from $30 to $100 per hour. The same people if provided by an accounting firm or a hardware manufacturer or software house would cost you from $80 to $200. The difference is about $75 per hour which is a saving of $150,000 for a year’s work. Our main concern is to find the

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quality of person that we require. Another difficult problem is to have them available when needed. However, with $150,000 in the balance we should be able to provide the individual with a suitable incentive bonus that ensures we get a quality job in the required time-frame. If we have separated your systems into two types, the operationally efficient and the competitively advantageous, then we make our problem easier. The systems that are required to be efficient will have very few changes and the people required to run them will be available from the lower cost end of the salary spectrum. We can use skilled part-timers or else increase the training for existing staff. For the competitive advantage systems we have the added problem that what we learn about these systems is an important knowledge base for the company’s future. It is not a good idea to contract out the development of your new system and then have all that new wisdom walk out the door and on to the next project - especially if it

happens to be for your major competitor. It is essential that the thinking behind the development and the knowledge gained should be available for any further work. Even if you have managed to carve out a new niche for your company your competitors will be trying to catch up. Staying ahead is what we need from technology and the knowledge of our staff. The implication is that your systems for competitive advantage will have a core of knowledge workers, some of high technological capability, continually helping you lead the organisation forward. If you are sufficiently large you will be able to afford this “High Tech” team as part of the cost of getting ahead of the rest of the competition. If you are not big enough to afford this overhead then some special arrangements are required. New software houses are always very keen to have ongoing work as a base for expanding. You should be able to find one or even start one up.

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You could guarantee an initial development set up and then a continual improvement agreement over a period of two or three years with some latitude for what you need. Part of the arrangement would be that the new company does not work for any of your direct competitors. This sort of agreement would provide you with a “Just In Time” knowledge base of skilled technical assistance without excess overhead of full-time staff.

Scott’s Law 22: Develop the Just In Time concept throughout your organisation.

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23. Muddle Management
You can’t keep a dead mind down.
Samuel Beckett (Irish Author)

Muddle management is the bit between top management and the people who do the work. Muddle management is the group of whom Mr Northcote Parkinson said “ . . . their work expands to fill the time available”. I always think of the MI5 and John Le Carre novels and how the truth as discovered by the operatives in the field is modified by the bureaucracy until it is unrecognisable and the department head makes the wrong decision. How many times have the CIA middle tiers of bureaucracy failed to understand the field operatives’ reports and given the wrong advice to the president. From the Bay Of Pigs debacle through the deposing of the Shah of Iran and on to Bush’s abortive attempt to rescue marines by

helicopter we have classic examples of field truths being warped by muddle management to ensure that top managers made wrong decisions. How did the Americans come to bomb the Chinese embassy in Belgrade? I have twice been called in to rescue Information Technology departments that had become major muddles and I have seen many smaller muddles. Muddle management just made bad decisions. They employed the wrong people. They failed to understand the problems they were required to solve. They tried to cover up their mistakes and to blame other people or else the computer. We still read today in the newspaper where the computer is blamed for company problems. It usually makes the headlines when it is a payroll running late or the banks don’t balance in the morning. The computer slavishly does exactly what it is ordered to do. It is the management of that process that is astray.

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The solution of course is to have no muddle management. The organisation of the future will have a Chief Executive and Line Managers making things happen according to their plans and no “Staff Officers”. The line managers will be people like the Operations Manager, the Sales Manager, the R & D. Manager and the Finance Manager. The Information Technology manager, the Public Relations director, the Marketing manager, and the Human Resources manager will be individuals who are hired on contract to provide advice to you and your line managers and to organise any assistance needed from time to time. These staff type people will not have any staff. Have you noticed that when you hear a Public Relations officer talking on radio or TV you automatically think that you are getting the standard company snow job. If you hear the Chief Executive you listen carefully. Other people measure you and your company the same

way. You don’t need a PR department. You may need specific advice from time to time. Know where to get it. When I hear academic types discussing marketing I am puzzled when they explain that marketing involves all processes in the company and that everything that the company does revolves around marketing concepts. I get very puzzled when they then talk about a separate marketing department. What is the rest of the company supposed to do while the marketing department is doing everything? Of course the whole company is involved in marketing. That is what you and the line managers are doing each day. The company is the marketing entity. You don’t need a separate department to do it. If you need specific advice then find the people with the specific skills required. If you are doing your job well you will hire senior staff who are fully competent to do their jobs. Their jobs include the process of hiring and firing the people that must work for them. If they

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can’t do this job then they are not competent and you must fire them. They in their turn will understand that if they hire a manager to control a group of people then that manager must also be able to hire and fire to develop the best team possible. If you hire somebody who can’t do this then you have made a major rod for your own back and reduced your effectiveness. Why do you and your line managers need a Human Resources department to do your job for you? You may need advice on employment law, psychological tests or intelligent tests from time to time. You may decide to employ a “Head Hunter” to find a particular person. You may need an agency to provide temporary or contract workers. When you put a Human Resources department between you and the applicant you will get the results of muddle management. You know who you want in your team. It is your job to get them.

The same thinking applies to the Information Technology manager. Operational Efficiency systems can be run by the users under line management with a contract to keep the software and hardware in running order. Competitive Advantage systems involve more thought from your whole team. This will help to keep the knowledge about these systems within your company.

Scott’s Law 23: Remove the Muddle Management layer.

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The company of the future will look like this:
HR Manager

IT Manager Chief Executive Marketing Manager

PR Director

Operations Real People

Sales Manager Sales Reps

R&D Researchers

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24. Open Systems
For every problem there is a solution that is simple, neat, and wrong.
H. L. Mencken

Remember the Open Systems debates? Why did everybody want an Open System? From the early days computer manufacturers made their own operating system which exactly suited the needs of their particular hardware. The operating system is a large and clever computer program that controls all the devices connected to the computer. This was fine, except that when users wanted to shift from one type of computer to another they found that the effort involved with the new operating system was much too expensive. They felt that they were trapped with their current supplier; and they were, and their suppliers sometimes did take advantage of the situation.

After years of being locked in to a particular mainframe environment in this way, customers began to demand Open Systems. That is, operating systems that would work on any machine. Just at this time, the academic world produced an operating system for their own purposes that would indeed work on a number of different machines and the business world welcomed this new system with open arms. The new system was called the UNIX operating system and it quickly developed into viable low cost alternative solution to the old operating systems. Then of course, since the UNIX operating system is transportable across computers we could change suppliers easily, the price of hardware plummeted even faster, and computers started to become another generic cheap commodity. This type of generic operating system was called an open system and soon all

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businesses were insisting on having an open system. All Requests For Proposal insisted that: “the solution must be an open system”. How did the manufacturers who had spent countless millions developing their own special operating systems react to this challenge? They redefined the term “Open System”, and we now find that ALL systems are Open Systems. For years Digital has worked on its VMS operating system for its VAX computers and IBM has a directly competing class of machines called the AS400 with an OS400 operating system. These two operating systems could not be more different, and both of them are different from the UNIX operating system. BOTH of them are now described in the company literature as Open Systems. You wanted to get away from specialty systems they just redefined the word open. During the last few years students have been building their own Unix type operating system.

They have called it Linux36. This operating system has been developed to such a level that it now competes as an equal to Unix. The big advantage is that it is free. As the operating system wars heat up between Microsoft’s multiuser version of Windows and the Unix promoters more and more people are opting for Linux; freely available from the Web. If you want to know what system you should be buying see the chapter Return On Investment.

Scott’s Law 24: What operating system you use is not the question. Pursue Competitive Advantage and Operational Efficiency.
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This is the prime example of what is called “Open Source” software. Red Hat of America provides documentation and support for US$50.

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25. Programmers
If a programmer is found to be indispensable, the best thing to do is to get rid of him as quickly as possible.
Gerald M. Weinberg

When you are hiring computer programmers it is handy to know that not all programmers are born equal. Programmers vary greatly in their ability to do your work. If we took an average group of professional programmers and gave them all the same program to solve, some would finish the job in hours, some would take days and weeks, some would never understand what the problem was and one would advise you to purchase a bigger machine as the problem was bigger than first imagined. Don’t laugh! One of my clients had a small computer and hired a programmer to write a few

programs to supply rebates and tax adjustments to their customers. After nearly two years the programmer had no idea of how to solve the problem and he could only stall for time by advising the client to get a bigger computer. The client had a time deadline because of the tax implications and they felt that their programmer would not finish in time. I was compelled to agree with them. One competent programmer and I analysed the requirements in a matter of hours and designed the system in three weeks. Our superprogrammer had the live version running inside three months. If my programmer cost you twice as much per hour to hire as the in-house one, which one would you use? The in-house programmer was paid $50,000 per annum and therefore cost the company $100,000 to produce nothing. The contract programmer cost $50 per hour ($100,000 pa) and the complete job cost the

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customer a total of $32,000 for a perfectly running system. Some time later another client needed to produce an Inventory System. This was to be a complex and comprehensive solution to their problem and was then to be used as a successful package in a number of organisations both here and in Australia. I assigned two staff to this job. They were both Honours graduates, one in Maths and the other in Physics. One had 10 years experience, knew exactly what he wanted and was the designer of the new system. The other had about three years’ experience, was as sharp as a tack and had a wonderful pragmatic approach to problem solving. We used a powerful development language that made a huge difference to our speed of working and we designed and built that system in one month. The system consisted of 108 programs and was a fully functioning system that we implemented directly into production for our

client the following week. There were no bugs and the system worked perfectly from day one. Now we were helped in this situation because we could design exactly what we wanted and did not have to spend time in discussions with the client which is always very time consuming and therefore expensive. We used rapid development tools that were naturally about 10 times faster than old languages like COBOL. We had a very small team - two plus me hovering occasionally. All factors in speedy development. But all the same, this example illustrates what two very capable people can do in a very short time. If you know exactly what you want to do and use the best of staff then the results can be astounding. Our policy was not to work overtime. This is because these “best” people are concentrating with dedicated ferocity on the problem at hand and it is not possible to work at this intensity for more than eight hours per day without burning
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out and making mistakes. Overtime for programmers does not work in terms of productivity per hour. Tired programmers make mistakes which then take many hours to find and resolve. Can you judge which people are the best programmers? It is a most difficult task which even professionals can get wrong, and hiring the wrong person can be a disaster. My real-life experiences led me to think that there really is a very large difference between the best and the average programmer, so I did a little research. In 1969 H. Sackman (et al) were studying the comparative debugging performance of programmers under conditions of on-line and off-line access to a computer. Not surprisingly they found that on-line debugging was faster. However, they also found something of much more significance: There exists a striking difference in performance between individual programmers.

The experiment involved two groups of programmers who were all “highly experienced research and development programmers”. The group was asked to write two programs to solve the “maze” and the “algebra” problems. Their results were: Performance Measure Algebra Debug Hours Maze Debug Hours Algebra CPU Time Maze CPU Time Algebra Code Hours Maze Code Hours Algebra Program Size Maze Program Size Algebra Run Time Maze Run Time Worst 170 26 3075 541 111 50 6137 3287 7.9 8.0 Best Ratio 28:1 26:1 8:1 11:1 16:1 25:1 6:1 5:1 5:1 13:1
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Score Score 6 1 370 50 7 2 1050 651 1.6 0.6

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The most important factors involved in providing your solutions are the time to solve the problem and the time to debug it. Now remember that this sample of programmers was “highly experienced” and they all found working solutions. However, you will see that in the most important areas the best was on average about 20 times faster than the worst. In real life I have found that the worst could not even provide a solution. Sackman was not the only academic to notice this discrepancy between the best and the average programmer. Professor Weinberg, in his book The Psychology of Programming tells a similar story: “However, abstract ideas about intelligence rarely fall into accord with our beliefs about concrete situations. Lacking any objective measure, we often judge how difficult a program is by how hard a programmer works on it. Using this sort of measure, we can easily fall into believing that the worst programmers are the

best - because they work so hard at it. A case in point was a programmer who worked 14 hours a day, seven days a week, for eight weeks to get a small program running in a new installation. For his efforts his company gave him an award for exceptional service. Shortly thereafter, another programmer (for the former had been promoted to a managerial position as an additional reward) was given the job of making some additions to this program. He found that the program was such a confusing mess that it was easier to rewrite it than to try and modify it. The rewriting and debugging took exactly one week, working normal hours. Even considering that writing a program for the second time is easier than writing it the first, the difference is significant. Moreover, the new program ran eight times faster than the old, took half the storage, and contained half as many lines of coding. Clearly, the first programmer had been rewarded for making a mountain out of a molehill. The discovery of this misapplication of management

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largesse then led to a severe drop in morale in this programming group.” The ratio in times is, strangely enough 19.6. Professor Weinberg’s situation relates very closely with Sackman’s results.

Scott’s Law 25: The best programmer is 20 times better.

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26. Project Management
There are risks and costs to a programme of action. But they are far less than the long-range risks and costs of comfortable inaction.
John F. Kennedy

about six months to a year. Start with one and complete it. This will give your staff confidence. Then go on to the next. This is the secret in implementing computer systems in commerce and government. Have a grand plan, but make sure that it consists of medium or small projects.

As far as Project Management applies to developing and implementing new computer systems the rules are few and simple. The first and most important rule is not to start with a project that is too big. Every large project (over about $10m) that I have ever come across was either given up half way through or finished with huge cost over-runs and dissatisfaction all round. If you want to complete a project so large that it will completely change the way your firm operates then divide this big project up into a number of smaller ones that will each last for

Scott’s Law 26: Only attempt “six month” projects.
One of the advantages of PCs these days is that we can get some good Project Management software on them. Microsoft Project has a great system for Gantt charts and Apple have a wonderful PERT chart. The PERT chart is excellent if you are having trouble finding the critical path through a complex project. Fortunately most Information Technology

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projects are not complex in that sense and tend to form a well-recognised pattern. This can be handled easily using the Gantt chart capabilities of Microsoft. The main reason for going to the time and trouble of using a computerised project management system is that it makes it much easier to obtain good communication among the participants. It is a case of one picture being worth a thousand words. Now, Microsoft Project is complex and contains a vast array of functionality - most of which we do not need in our Information Technology projects. Our concept here is to use the plan to make sure that everybody has the same picture of the project as you do. Then, if it is running late, everyone can see the reason. When you set up a plan in a PC make sure that you follow these steps: • Make a list of all the tasks that need to be done. You must include every task.

• Show the dependencies between tasks so that they follow their proper order. • Have a milestone called “Start Project” and ensure that all tasks follow on from this first task. • Have a milestone called “End Project” and ensure that all tasks lead to this one. This now means that all tasks have a preceding and a succeeding task. • Fix the “Start Project” milestone with a “Must Start On” date. Now as you adjust the timings for each task the “End Project” task will move backwards and forwards in time. This will tell you realistically how long the job will take. • Work out who is going to do each task and how long it will take them. Discuss this with each worker and all users. Agree each task time-frame. Now complete the task list and round the loop again. You must get each person to agree to this time-frame at this point.

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• Check that your resources are not working in two places at the same time. The system has a means for adjusting staff called leveling and it also holds individual calendars for each person with holidays and hours available. This helps with this job. • You are now able to check the completion time with the project sponsor. The biggest mistake that novices make is to fix the end date because they are told the project must be finished by then. They then develop a set of tasks which have an unrealistic duration in an effort to show that they can develop a plan to meet the schedule. If you do this you will have a set of unrealistic expectations and I can guarantee you complete dissatisfaction from all quarters. • If the “End Project” date is too late for the project sponsor then you and she must work together to see how the project tasks may be adjusted to bring the “End Project” date

forward. You could use more staff and overlap some of the tasks or you could discuss the timings with the staff again to see if some of them can be reduced. You might need to meet a targeted date by taking some of the tasks out of this project and placing them in a following project. (This means that you are achieving a target date with a limited solution but this may be an acceptable approach.). Start on the start date. When I am managing a project I then print out the complete project, pin it to the wall and hang a bright red string down in front of it. This string represents the current day and each day I move it over one day37. Everybody can now see how the various tasks are proceeding and which ones are falling behind. Remember, each person was asked to estimate the time for their tasks. Of course each task has
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Start every day off with a smile and get it over with. W. C. Fields

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the owner’s name printed alongside. The psychology of peer pressure works to keep the project on target. When some manager wishes to impinge on the time of any of the workers it is easy to show how this will alter the whole project. This picture concentrates the mind. Keep it clear and simple. This is your means of communications with everybody.

constructed you will soon understand the amount of people time involved in the project and thus get a good estimate of this cost. Costs for hardware, networks, packaged software and alterations to the software will be fixed by the Request For Proposal process. With care and attention you should be able to keep your project on time and within expected costs.

Scott’s Law 27: Your project plan is just a picture for all to see.
MSProject allows you to keep track of the work done and the money involved as well as the duration of each task. If your plan has been well

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27. Prototypes
In business school classrooms they construct wonderful models of a non-world.
Peter Drucker

The most difficult thing in all of computing is the communications problem. How do you describe a new-looking screen to a programmer? How do you describe a series of screens to a programmer? How does the programmer show you how those screens will work together? It is difficult to know exactly what should be on a screen for a new system and much more difficult to arrange a series of screens so that the user will have a system that does the right thing and feels natural. To build the complete system and then ask people if they like it is to court disaster. To

describe the system with words and even pictures can leave a lot unsaid and it is difficult for people to imagine how they would use the system. Users try to describe what they want but how can they be sure that the technicians have understood? This communications gap is the main cause of computer disasters. The solution is often to build a system that looks like the real one but is just a mock-up. That is, your programmers can make screens that look like what we have in mind but just don’t put the complicated bits in behind. People can then see how the system looks and even how it will work in a primitive way. Then the people who have to use the system can say “Yes, but you forgot to include the “Stress Factor Code” on the second screen.” Or “If you put half that information on that other screen it will save time entering data”.

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And so on. The designers can then build prototype II and your users can then start the same critical process38. If you have a prototype, people will soon say whether they like it or not. If you have a treatise on functional requirements with data models and work flow charts you have a monument to technical cleverness and a large invoice. In many ways, of course, this is the reason to look at packages. That is, all the systems thinking has been done and the user functions worked out to suit real people in similar situations. You can see what you are buying. However, sometimes a suitable package does not exist. If you are pursuing the cause of “Competitive Advantage” then it may be that some clever things that give you the edge in your industry must be designed and built from scratch. You have indulged in some creative thinking and
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developed some new ideas for your business. This is where the prototype can be a real advantage in allowing everybody to visualise the new system. Mock-ups can be done in a fraction of the time and with modern tools they can be the skeleton of the real system. I once designed a system for the racing clubs of New Zealand to run on a PC. With the assistance of a very smart programmer, I constructed a prototype to do all the basic jobs of “Nominations” and “Acceptances” including connecting to the Head Office for up-to-date information on owners, trainers and jockeys. We even built the prototype with a new “Barrier Draw” function - complete with a random number generator. When the prototype was finished we showed the committee of five club secretaries how it looked and how it worked. Of course it had no editing functions so we could put rubbish in if we wanted to but we were able to show these
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Why should you mind being wrong if someone can show you that you are? - A J Ayer, British philosopher.

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practical people exactly how the system would work in their club. They saw some omissions and made a few suggestions but with that one meeting we had acceptance of our system design. This approach ensured that the users got a system that was just what they wanted and when the final product was delivered the club secretaries were immediately able to use the system and it did the job exactly as they required. Our post-implementation audit was a very satisfying affair.

Scott’s Law 28: A Prototype is the best means of describing the system.
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28. Request For Information (RFI)
Make things as simple as possible, but no simpler.
Albert Einstein

“Constant change is here to stay.” I saw that notice on the wall of Burroughs’ computer room in 1973. Burroughs is now UNISYS and that notice is as true today as it ever was. If you want to stay in business then you have to be in that constant process of change. If you are looking for new systems, hardware or software then you can bet that the market has changed substantially in the last few years and new technologies will be producing ever more benefits at greatly reduced prices. These may not be relevant to you and of course you don’t want change for change’s sake. Don’t stick blindly with tried and true. See what is available - out there - NOW. This will also

(unsubtly) keep the incumbent suppliers on their toes and you may make some unexpected finds. For instance, one of the most unlikely “packages” we could hope to find would be for our National Library’s “InterLoan System”. With only one system for our whole country you wouldn’t think that anybody would be building these systems and selling them off the shelf. On the contrary, we found an excellent system in England using modern technology and providing what the Library needed. The other point that is often overlooked is that suppliers of software may be more knowledgable about your particular industry than many of your staff. They will have spent many years working with organisations like your own to perfect their software. The resulting package should have much sophisticated functionality contained within. This knowledge is then provided to your staff as part of using the package. In a sense you

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will be using the software package to train your staff in the latest thinking in your industry. When you issue a Request For Information you are giving some of the world’s most knowledgable39 people the chance to educate your staff in the latest ideas in your business. Choose your respondents carefully and let them tell you about their product. Are you chasing Operational Efficiency or Competitive Advantage? The idea of the Request For Information is to find a shortlist of prospective suppliers that you can ask to respond to your Request For Proposal. This is a winnowing process to find the best possible suppliers and save time at the Request For Proposal stage. The Request For Information should be as broad as possible. You are there to learn from the world’s best suppliers.

If there is nothing suitable in existence then you will need to do some heavy thinking. The responses will also assist you in developing your Request For Proposal into a complete set of required functions. After all, if you don’t realise that something exists how can you specify it in the Request For Proposal? This process will help your Business and Systems Analysts (if you still employ such people) to do their job more quickly and easily. They will learn from the suppliers.

Scott’s Law 29: Issue a Request For Information - the education will be worth it.
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Knowledge has always been one of the three tools of power: the other two are violence and wealth. Alvin Toffler, American futurologist.

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29. Request For Proposal (RFP)
There is nothing new under the sun but there are lots of old things we don’t know.
Ambrose Bierce

potential suppliers unnecessarily. Aim to end up with a short list of three with whom you will negotiate to get the best deal. If you are searching for Competitive Advantage then your strategy is somewhat different. You are looking for ways to make your company a market leader through a system that is better than your competitors. You may not want to use the same system that all your competitors use. The answer might be to use a computer package as the base and use a special team to enhance it to your requirements. The finished product is then yours and yours alone. A number of our customers started with good basic accounting packages and went on to develop “industry best practice” systems. We designed and built a specialised package for a group of four Ford Dealers. It was tightly linked to the way they did business and would require a major change to

The Request For Proposal will become part of the legal agreement with the supplier so it will need to be written correctly and be the complete set of desired functionality. If your team has already seen what the world has to offer then this will not be too difficult. It is every supplier’s dream to help write the Request For Proposal. They can all help (see Request For Information). If you are chasing Operational Efficiency then restrict your requirements to the essentials. You are going to look for a best price. Functionality will not necessarily relate to price so keep the requirements broadly based and don’t eliminate

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make it suitable for other Car Dealerships. However it soon became recognised as the best system for Ford Dealers and we had little competition when it came to selling it to them. You may need to develop a special system from scratch40. This is risky and should only be undertaken for small systems. The project must be achievable within six months to a year. (See Project Management and Prototypes.)

Scott’s Law 30: Request For Proposal - issued when you know what you want.

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We learn from experience that men never learn anything from experience. - George Bernard Shaw

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30. Risk Analysis
As far as the laws of mathematics refer to reality, they are not certain; and as far as they are certain, they do not refer to reality.
Albert Einstein

plan will have the complete list of tasks. Add to this any outside factors or involvements by third parties. Then choose the items that have a high risk associated with them. If the project plan is complete then you should now have a good idea of where to concentrate your managerial skills. If any of these tasks fall onto the critical path then this will provide you with a clue. The important point is to ensure that your staff involved in designing, building and implementing the system are all aware of the critical points in the project. Forewarned is forearmed. The skill is in ensuring that everybody is aware of likely trouble points, not in trying to perform detailed numerical estimates of risk. This

All projects involve risk41. The trick is to discover where these risks lie and to eliminate or at least to reduce them. The first risk is starting a big project42. Reduce the risk by making it two or more small projects. This sounds trite but it is your first analysis, and reduction, of risk. When your project manager has produced a project plan this must be discussed with all the managers involved in the project present at one meeting. The topic of the meeting is Risk Analysis. The project
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The incompetent with nothing to do can still make a mess of it.- Laurence J Peter If I had been present at creation, I would have given some useful hints. - Alfonso the Wise (1221-1284) next
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application of the Pareto principle will solve 80% of the risk with 20% of the effort. You will not eliminate all risk.

Scott’s Law 31: Planning and open communications will reduce risk.

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31. Solutions
You are either part of the solution or part of the problem.
Eldridge Cleaver

and your senior executives can find the solutions that will suit your evolving organisation. Remember that with computer systems you must decide whether you are after Operational Efficiency or Competitive Advantage. When you know that for any system, you will be able to find the most suitable solution.

Everybody wants solutions. Salespeople are trained in Solution Selling. Computer companies provide solutions not computers. Wherever you look in our industry you will see people selling solutions. More important is, “What is the Question”? This book is designed to help you ask the questions that need to be asked. At any stage in the life of your systems, people will want to tinker with them or to ditch them43. If you think about the message of this book you should be in a position to ask suitable questions so that you
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Scott’s Law 32: Solution salespeople should be dissolved.

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After you have done a thing the same way for two years look it over carefully. After five years with suspicion and after ten years throw it away and start all over again.- Alfred Perlman - American Railroad Executive

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32. Testing
If debugging is the process of removing bugs, then programming must be the process of putting them in.
Dykstra, (Professor of Computing)

when they want to install a new computer system to ensure that the package does exactly what was agreed. This has led to a peculiar situation. Your organisation buys a new software package and you require the software supplier to make a number of changes. When the package arrives and your Information Technology staff install it they initially put it in a separate area so that your Test Analysts can subject it to a “proper” test. When they have found all the “bugs” and the supplier has fixed them all it is then deemed acceptable and put into production. Your staff are trained and they can then start using the new system. All this seems very simple and a good idea except for one thing. You are paying for a product and then you are paying to test it to see if it works. Don’t we have a consumer law that
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With the arrival of the Y2K problem many companies began a huge testing program. Our largest corporations each spent almost $100,000,000 in testing all equipment and every computer program. The greatest fear was that if anything was left untested it could be the weak link that would destroy the organisation. There was no choice. This has seen a major growth in the number of people who are specialist computer program testers. This has seen the growth of a new Information Technology specialist - Software Test Analyst. Many of our larger organisations are beginning to hire a number of Test Analysts

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stipulates that your supplier must provide the product in a workable condition? Why should you be paying to solve the supplier’s problems? Shouldn’t the supplier already have done the necessary testing? If you are supplying the final testing facility then there is a very real danger that the supplier will become complacent and deliver shoddy software on the basis that you will find the errors and save him money. If you are buying software that is not “shrink wrapped” and “off the shelf” then you must have an agreement with your supplier about the final acceptance testing process. It may be a good idea to have an acceptable third party testing regime that you and your supplier both pay for. This will provide them with an incentive to do their work properly and have no “bugs” creating havoc and costing you money. There are a number of

different ways of defining a suitable arrangement. This will depend on the quality and resources of your supplier and the importance of the new software.

Scott’s Law 33: Don’t buy software and then pay to test it.

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33. The Branch Office
The only things that evolve by themselves in an organisation are disorder, friction and malperformance.
Peter Drucker

Information”. If you are installing new systems around your branches then you will want to make sure that the system works well for your best branches. In this situation we always involve staff from the best two or three sites which are representative of all the branches. If you are aiming for competitive advantage you will be providing a system that will be specifically tailored to the requirements of your best branches. When your best people are happy that the system is right, then is the time to implement it around the other branches. The staff of the branches with problems will then be trained in the new methods and if the system is properly designed it will naturally lead them to do the right thing. Hopefully they will complete the daily round successfully and at the end of the day all transactions will be in the

If you are lucky(?) enough to have a set of branch offices you will know that not all of them run with equal efficiency. You will have probably discovered that while one or two run well with happy customers and sufficient profitability some of them are a mess and seem unable to follow the easiest of instructions. We need to find ways and means of converting the latter into the former. Good systems can do this. One of the surprising and most useful things that a good computer system can do is to teach your staff how to do their jobs. I have alluded to this elsewhere, in the chapter titled “Request For

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computer. This will give you a vital edge in the fight for survival – the Daily Operating Control (See Chapter 15). The biggest problem with branches is that they are branches. That is, they are not close by where you might have better control over their activities. Your biggest ally in this is a properly designed system that brings all your staff up to a standard and which gives you a print-out of results every day. That way you can keep your finger on the pulse. Any perturbations and you can take action straight away.

Scott’s Law 34: Your systems should train your staff.
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34. Training
If you think education is expensive, try ignorance.
Derek Bok

This will, of course, be varied according to how many people are to use the system, but with this basic concept of “training the trainers” you get maximum learning for least cost. Creative minds have always been known to survive any kind of bad training.
Anna Freud

Training is the essential part of systems that too many people forget or gloss over. It is the first thing that goes when money gets tight and when implementing systems money always gets tight. One thing I learned from my days as a teacher is that I learned more about a subject by teaching it than I ever did by studying it. This thought provides me with the maxim for training your staff in the use of new systems - PC and otherwise. Ask the supplier to train one or more of your staff so that they are proficient in the new ways. Then get your trained staff to educate more of your staff and then get them (with the assistance of the first few) to train their staff.

This conviction that training is important implies that your systems have sufficient documentation around them to use as a base for training. Buying a system includes buying sufficient documentation so that your staff can use it properly. One of the biggest and most complex systems I have ever seen is used by hundreds of people and it is entirely without documentation. Learning how just some parts of it work takes

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months. This is expensive use of time and of course training is rare and spasmodic. Still, hundreds of people are teaching themselves by trial and error each day. I have never let my schooling interfere with my education.
Mark Twain

Don’t forget that training will also include you44.

Scott’s Law 35: Train your trainer.

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“I do not seek, I find.” - Pablo Picasso

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35. UPEL
Nine-tenths of all existing books are nonsense.
Benjamin Disraeli

Each year there is a new buzz word which is touted as the UPEL (see above) and if only you can agree to their costs you can have user ecstasy. Beware. Remember BPR? This stands for Business Process Re-engineering. In other words, have a good look at your total business operation and see if you should re-jigger all your systems to produce the New Wave company for the nineties. Twenty or thirty years ago we called this process Systems Analysis and we also discovered back then that trying to redefine everything at once would generally cause a big headache. We now know that 70% of BPR projects have been failures46. No-one points to any significant success story.

This is the “Universal Panacea - Elixir of Life” acronym syndrome. Every year from the year DOT (Dawn Of Time) the computer industry has been producing a plethora of products and services that have been coded with sexy acronyms to stick in your mind. Some acronyms become so embedded that noone can remember what they stand for. Try CICS45 for size. This has been around IBM Mainframes since the early days and still survives on today’s computers. I haven’t yet found anyone who knows what it stands for although some will hazard a guess such as Communications Interface mumble mumble.
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Scott’s Law 36: Beware the touter of UPELS.
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CICS stands for Customer Information Control System. Test your Information Technology manager.

“To be honest, I don’t think we accomplished anything,” said the man who led Levi Strauss’ reengineering effort.

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36. Writing Reports
Real knowledge is to know the extent of one’s ignorance.
Confucius

the work may have been easy or difficult. Regardless, you must produce a report that is clearly laid out and easy to understand by readers of intelligence. Bertrand Russell said that when you are writing your PhD thesis you should be as obscure as possible to prove how intellectually brilliant you are. For the rest of your life you should pursue simplicity. When I was completing my maths degree I tried to read the original Principia Mathematica (1911) and couldn’t get past the first page. I recently found the second edition (1928) in the library and found it surprisingly easy to understand. Either my memory is astray or they made it easier to read in the second edition. (Perhaps I am just getting smarter in my old age.)

Introduction This section illustrates how to write reports using the style features of Microsoft Word to make the layout easy to type and easy to read. Give this section to any staff who are writing reports for you and insist that they follow this methodology. Simple The purpose of writing a report is to provide a clear understanding for your reader of what may be an obscure subject47. The analysis phase of
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Einstein was a man who could ask immensely simple questions. And what his work showed is that when the answers are simple too, then you can hear God thinking. Jacob Bronowski in “The Ascent Of Man”.

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Clear48 There are a number of ways to assist in making your work clear: Lay out your work so that the main points are made in a logical order, Keep the language plain and the sentences short, Use bullets to list the main points. You will be surprised how often your work and ideas will naturally conform to the “three49 bullet points” rule just illustrated. Layout50 This section uses the standard Microsoft Word “Heading Numbering” function in the “Format” menu to show you a layout that your staff can follow easily.
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Indenting This makes it easy for the reader to see the hierarchy of ideas. It also helps for you to form your thoughts into this hierarchy. More Indenting This illustrates the effect of having two ideas under two headings at this level. Conclusion51 And of course all reports should end with some conclusion. This section is to help your staff use the facilities in their PC to produce the best reports for you.

Scott’s Law 37: Think clearly, write plainly.
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The irrational separates us, the rational unites us. Bertrand Russell Omne trinum est perfectum. Everything in threes is perfect. Try to find something that works and stay with it. Robb Sagendorph - American Economist
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37. Epilogue
Nothing is ever accomplished by a reasonable man.
Fred Bucy - Texas Instruments Executive.

Business is war52. Business is a struggle to survive. Only the strong and the innovative grow and prosper. In war, it is said, the generals are always fighting the last war because that is the one they know about. In business we cannot afford to do that. We must look forward and discover what the next war is. We see that people are becoming increasingly expensive while commodities and manufactured goods are getting cheaper and cheaper. To advance our business we must reduce our human costs by using the latest technology. You can guarantee that your competitors (or some of them at least) are already doing this.
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In business and in war we have the front end fighting force and we have the staff back at company Head Quarters. With limited resources we must maximise our fighting force and their equipment and save cost and confusion by trimming back the staff positions. Hannahs Shoe stores have been in business for 130 years. Things have not been going so well recently so the board appointed a new General Manager who bought a large share-holding in the company. He immediately reduced Head Office staff from 84 to 27. Why wait so long? Your Information Technology Department consists entirely of staff positions. All its work consists of looking after systems that are either designed for Operational Efficiency or for Competitive Advantage. We should reduce all people costs associated with the Operational Efficiency type systems and concentrate our efforts on the Competitive Advantage systems.

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In war there is no substitute for victory. General Douglas MacArthur

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We should out-source all work for the Operational Efficiency type systems and concentrate our few top staff on the Competitive Advantage systems. These are the ones that give our salespeople (fighting force) the tools (weapons) to succeed. Perhaps you can convert some of your Information Technology staff types into part of your line force. This philosophy can be extended to other “Staff” type departments. Take Human Resources for instance. One of your jobs as Chief Executive is to hire the best possible people to report directly to you. You know what you want in a Chief Accountant or Sales Manager. It is your job to find the right person for the job and then to manage that person so he will reach his full potential and perform miracles on a daily basis. Would you trust anyone else to hire these senior staff for you? One of the main attributes that you are looking for in your immediate staff is the ability to hire the staff they need. You are not likely to hire

anyone who can’t find and control the best of staff. You know that if they make a mess then you will pay for it and then have to clean it up. Similarly these senior executives will hire competent managers who can also find their own most suitable staff and hence maximise their results. This is what a manager does. All managers must meet budgets and they must use their staff and funds wisely to do so. They must hire staff who can do the job. Why then do we need a Human Resources Department53? Can we find a good computer system that keeps track of information that managers need to know? Should the payroll be run by an outside organisation that specialises in that business? Would it be cheaper? Is payroll an Operational Efficiency type system or a Competitive Advantage system? How much useful management information is available from the payroll system? Do we need a Human Resources system? What would its function be?
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If you can’t annoy somebody, there’s little point in writing. - Kingsley Amis

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Do we need an extra system at all? How much use do we make of outside “Head Hunter” organisations? If we use them, what are our inhouse Human Resources people doing? As you can see, our primary dichotomy of system types can produce some interesting questions. What the answers are is over to you and your organisation. There is no blanket answer that is correct for all organisations or even perhaps for the one organisation over all periods of time. Things change. We are fighting a war and the way to do that is to get on the front foot and lead into the battle, and not sit comfortably at the rear having discussions with staff about many and various esoteric subjects. We can’t wait for the opposition to overwhelm our territory before we react. We must be making positive steps all the time to improve our organisation and the systems within it. No sooner had Bill Gates made a success with MSDOS than he was superseding it with Windows, and that went through Version 3.1 to

Windows 95 and then Windows 98. Maybe the computer industry changes faster than most others but the one thing we know for sure is that “Constant change is here to stay”. The successful company of the future will be lean and mean. The employees will be directly involved in operations, sales or accounting. Other areas like Information Technology, Human Resources, Public Relations and Marketing will consist of one person who controls the sourcing and purchase of skills as and when needed. The CEO together with these four individuals and the heads of operations, sales and accounting will form the creative centre of the business. There will be no “Staff” positions - only the top management and people making, selling and accounting for it all.
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Scott’s Law 38: Winner companies will have no Staff positions.

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38. Summary
Take what you can use and let the rest go by.
Ken Kesey (American novelist)

Objectives Get the basic concepts right. Understand the future and drive towards it. Any given system should either gain you Operational Efficiency or Competitive Advantage. Use creative thinking to develop your digital business model. Strategies Your business strategy will inevitably become dependent on your Information Technology strategy. All business will soon be E-business.

Your strategy is to define your market so that you have no competition. Increase shareholder value by seeking operational efficiency and competitive advantage from your systems. Information Have a DOC today. Data, Data everywhere and all the thoughts did shrink; Data, Data everywhere and not a thought to think. Some interfaces can be tricky.

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Resources Spend as little as possible and as much as necessary. Develop the Just In Time concept throughout your organisation. Remove the Muddle Management layer. People You, the Chief Executive, make the difference. The fewer Information Technologists on your staff the better. Your consultant must give advice without bias. Pay your contractors for results not hours. If you can’t understand him ignore him. The best programmer is 20 times better. Solution salespeople should be dissolved. Beware the touter of UPELS. Train your trainer. Winner companies will have no Staff positions.

Planning One original think is worth a thousand logical thoughts. Only attempt “six month” projects. Your project plan is a picture for all to see. Think clearly, write plainly. Planning and open communications will reduce risk. Issue a Request For Information - the education will be worth it. Request For Proposal - issued when you know what you want. Systems • Which operating system you use is not the question. Pursue Competitive Advantage and Operational Efficiency. • Competitive Advantage systems should not be out-sourced. • A Prototype is the best means of describing the system.
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• Don’t buy software and then pay to test it. • Your systems should train your staff.

To understand your company, become a customer.

Common sense is hard to find.

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