Operational chaos hits UK business  

Steve Ponting at Software AG asks whether technology is a help or a hindrance

 

In an ultra-competitive business landscape that’s increasingly built on software, Heads of Transformation and strategic leaders have to keep shape shifting. One day they must address efficiency, the next day customer service. All the while, delivering positive change and growth. 

 

To achieve this feat, they must have full oversight of people, processes and technology, ensuring they are flexible enough to provide resilience, but also robust enough to comply with auditors and regulators alike. Smooth running processes are vital for business continuity as well as growth - but, as technology expands and becomes more personalised, duplication, divergence and conflict can creep in. This creates an organisational chaos. 

 

The quick-fire pace of tech advancement is leading to systems overload. Software AG’s recent Reality Check Report, found that 86% of UK organisations have substantially grown their tech infrastructure in recent years. And the majority (76%) say that this has made work more challenging. 

 

The challenge is that they are drowning in software. Businesses, at enterprise level alone, saw their average number of apps jump from 843 in 2021 to 1,061 in 2023. The resulting patchwork of solutions is proving cumbersome and becoming increasingly unworkable.

 

These numbers only reflect the known applications – shadow IT is another maze of quick fixes, upgrades and isolated downloads. Software AG’s research also showed shadow IT is an issue for 82% of businesses where employees bypass company sanctioned IT resources and using their own software and devices in working life. 

 

At a time when cost cutting, streamlining and agility are critical for many businesses, organisational chaos is making the business of transformation much harder. However, managing the chaos is possible. The sprawl of processes can be brought back under control if the right level of process intelligence can be applied. 

 

Here are some key considerations. 

 

The hidden dangers of tech stack expansion

It’s a classic tale: a new technology comes to market and businesses flock to try it, in an attempt to steal an advantage. The intention is good, but what’s often missing is a clear definition of the intended business impact.

 

While the right technology can make a big impact, if it’s poorly implemented, it will only add to the complexity. Despite best intentions, shoehorning in new technologies without clear strategy for their use creates new deviations in a process, which can cause inefficiency, or a non-compliant situation. It can make the complex unmanageable when all you wanted was efficiency.  

 

For example, imagine if an employee or department introduced new reporting software that doesn’t integrate into the current systems. There is duplication of processes and/or a bottleneck where the two need to combine. A riskier example could be a new procurement system brought in by one division of the business, without the knowledge of key central functions. This process deviation can cause inventory anomalies or unaccounted for costs that disrupt key financial processes.  

 

Operational chaos is a maze of different processes and systems, causing a slowdown in decision-making and action for 80% of businesses. The resulting lack of agility and low productivity threatens operational resilience, customer relationships, and regulatory compliance. Managing the chaos, however, is possible.

 

So, where’s a good place to start?

Simply put: process intelligence. Understand where there are bottlenecks; where multiple deviations from standard processes create inefficiencies or where non-compliant processes are emerging. 

 

This approach helps pinpoint the actions that could have the largest impact on the business.

 

With the right level of process intelligence, adding new solutions to the mix is less risky. Organisations will be able to match innovative new tech to problems they need to solve. For instance, generative AI can be a problem if not implemented properly, but if organisations know that certain processes have bottlenecks because of heavy manual workloads that can be automated, suddenly they have an opportunity to become more efficient. This kind of systematic approach to implementing technology pays dividends down the line. 

 

Scaled up, organisations should look at a full circle audit for any new technology. This means understanding what the output will look like, who owns the technology and what are the ripple effects for other systems or processes. It’s imperative at this stage to consult with the technology partner to have a clear consensus.

 

The thing to remember is that giving someone access to a new tool isn’t the end game. Whether the goal is efficiency, quality of service, productivity, compliance, profitability or growth, the right technology is the enabler. But the wrong tech is a blocker. Knowing the difference is what determines success.

 

Digital transformation is a double-edged sword. Clarity of vision for business outcomes helps make sure you’re on the right side of it and can operate through the chaos.

 

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Steve Ponting is a Director at Software AG

 

Main image courtesy of iStockPhoto.com and yourstockbank