Chapter 8: Vision - The Next Frontiers

Overview

Are we there yet?

We know what we need to do. We understand the power of our information resources and the enormous value potential. But knowing this and implementing a strategy for using our information resources are two different things. We still have a long way to go. Throughout this book we ve looked at top companies that are acting on the vision, but none of us are using our information to its full potential. There s work to be done. We haven t fully committed to our information resources yet. Many large companies are still struggling to sort through the flood of data and get a single view of the business. It s a process that takes time, commitment and energy, from the CEO to the front lines.

The statistics are revealing :

• 54 percent of U.S. business executives say their data is doubling and tripling every year.

• 73 percent say it s not easy to navigate, understand or use the data they know they have.

• 73 percent say they made more daily decisions this year than they did last year.

That s the executive level. At the employee level, the statistics are reinforced:

• 75 percent of workers say they miss opportunities because they don t make decisions fast enough.

• Only 25 percent of workers believe that their organization is moving faster than its competitors .

The trend is against us if we don t stay on top of our information. Leveraging our information is not about technology. It s about how we want to manage our companies. The company with the best understanding of its customers, its processes and its organization is going to win.

We understand intuitively how to run our businesses in near real-time. Now we need to execute on that understanding. We need to envision beyond that goal. Our new motto should be foresight is 20/20. Even a recent series of print ads for Nasdaq shows quotes on this popular theme. In one ad Bruce Chizen, President and CEO of Adobe Systems Inc., is quoted, If you want to make history, create the future. In another, Bruce Carter, President and CEO of ZymoGenetics, is quoted as saying, True vision is the ability to see things that don t yet exist. What we need to do is on the tip of everyone s tongues , but it has yet to be truly executed.

Retail, manufacturing, shipping, airlines, financial services and every other industry will be called upon to use its information resources more effectively and efficiently or fall behind. The speed and volume of information accumulation must be met with ever-greater ingenuity.

Experts Say

The demands on capacity and speed are increasing exponentially as free trade continues to expand on a global basis.

Klaus Zumwinkel
Deutsche Post World Net
Chairman of the Board of Management

 

Information resources will drive the next phase of improved productivity in business. Companies will move from using information strategically to using information tactically. Strategic decisions have always relied on the information a company has about its past performance. The assumptions a company made about the future were based on analyses of historical data. But the most successful strategies require that information be used for the day-to-day tactical decisions. Real-time flexible reactive and proactive decision-making means using information tactically to successfully execute strategy.

Business fundamentals haven t changed. In fact, as the market accelerates and speed of decision-making becomes ever more critical, it is increasingly important to refocus on the core business drivers of our companies. We need to be faster and leaner, but we don t need to change our business basics.

Retailers need to continue getting closer to their suppliers and partners , opening up the supply chain process, shaving inventory and restocking more responsively. Manufacturing needs to continue closing the gap between factory and consumer. The logistics sector needs to keep meeting the challenges of steadily higher growth in global distribution networks as national boundaries become ever more permeable. Financial services needs to continue working to be more relevant to customers. We all need to be more transparent in our business operations. The more freely information flows, the more fulsome our information resources, the more questions we can answer. Answers mean opportunities.

We need to ask questions we don t know the answers to today and then ask even harder questions.

Financial

• How can I improve share price in any economy?

• Where are new product introductions not getting results?

• How do I know that when I sign off on financial documents they re accurate?

• How can I drill the financial detail to redirect, streamline and cut costs?

• How can I improve margins, pricing, inventory and accounts receivable to get better cash flow?

• How can I better sweat my assets and leverage return on capital?

Operations

• Is there a way to reduce our cycle times?

• Can we reduce back-order situations by leveraging all our inventory and capacity?

• Which of my distributors is contributing to profitable growth?

• Can we leverage our total procurement power to cut spending?

Sales and Marketing

• Where are my profitable relationships?

• Where are my sales performance deficiencies?

• Where can we increase market penetration?

• What are the opportunities to improve customer penetration and reduce churn?

• Where are new customer and market prospects?

• Are retention programs working as well as they should?

All of us can answer some of these questions right now. None of us can answer them all right now. The company that gets there first will have an enormous competitive advantage. This is the information we need to begin using tactically and not just strategically. Information transparency is a long- term strategy and a tactical necessity. In these pages we ve seen that many top companies are already on course for dramatic improvements in productivity. Still more can be achieved.