Management Perspective

Business has witnessed the development of the completely integrated ERP suite, a goal set back in the early 1960s. Despite this great technical achievement, many organizations continue to implement a hodge-podge of major enterprise applications from different vendors patched together through various means such as the sophisticated EAI toolset (see, for instance, the December 7, 1998, article in Fortune, "The E-Corporation"). Richard Nolan (1993) presented what the authors believe is a compelling explanation of this phenomenon in the development of the Stages Theory, a framework for understanding the assimilation of information technology (IT) in business organizations. This theory was developed based on the discovery that plotting the annual computer expenditures of an organization formed as "S-shaped" curve, similar to learning curves and experience curves. Hence, enterprise applications are adopted into organizations based on a learning curve. Every organization traverses the stages of learning in a sequential manner: initiation, contagion, control, and integration.

A simple application for this theory to consider is the evolution of the Office Suite, a market now dominated by Microsoft. Twenty years ago, spreadsheet, word processing, presentation graphics, and databases were all separate products offered by different vendors. It was very difficult to communicate or share data or information between these applications unless one was willing to literally cut and paste from one hardcopy to another. Today, it would be hard to find any justification for not having only one vendor provide all of these applications, and more (e.g., website development, project management), on a single integrated platform. This will soon hold true for the ERP suite (viewed as being between the "control" and "integration" stages), and eventually for the e-business suite (viewed as being between the "contagion" and "control" stages) as well. The integrated e-business suite will be the cornerstone of the intelligent enterprise.

The challenge of implementing ERP solutions is well documented. The ROI challenge of an ERP solution is also well documented (see, for instance, Davenport, 2000). Despite the great potential, the promise of ERP technology has yet to be realized for many organizations. ERP initiatives have been mistakenly identified as "projects" whereas they are really "programs;" ongoing and in need of constant attention and resources. Davenport et al. (2002) points to specific areas that organizations must focus on in order to capture the original promise of enterprise solutions: integrate (data and processes), optimize (processes), and informate (turn data into information and knowledge). In reference to the last point, intelligence exists when information and knowledge are acted upon, either at the highest or lowest levels, both, or anything in between. The intelligent enterprise of the 21st century will have their ERP and e-business suite implemented, integrated, optimized, and informated. This enterprise will have decision-makers trained and educated on utilization of information effectively in their environment.

All too often, in a technology intense environment, the technology itself becomes the center of attention. It is important not to loose sight of the objective of the technology, whether it aims to make intelligence available to the decision-maker or to make the world a more pleasant place to live, for instance. Intelligence is not possible in today's environment without integration, in large measure due to the critical nature of the temporal dimension of intelligence. In fact, many dimensions of integration have been identified in the literature (Ghoshal & Gratton, 2002): operational integration (standardized technological infrastructure), social integration (collective bonds of performance), emotional integration (common purpose and identity), and intellectual integration (shared knowledge base). The technology is ripe for operational integration in most organizations. But the far greater challenges of achieving emotional, intellectual and social integration have yet to be realized in most organizations.

Intelligent Enterprises of the 21st Century
Intelligent Enterprises of the 21st Century
ISBN: 1591401607
EAN: 2147483647
Year: 2003
Pages: 195 © 2008-2017.
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