A couple weeks ago, I was chatting my friend Justin, and we got into a great discussion about how businesses seem to be so poorly run, despite having access to almost limitless data. So, what’s the deal? how is it in an age of ERP systems that capture everything you do, we still see so many organizations struggling, or worse yet, barely hanging? Well, we came up with a couple of things that I believe explain a lot (and I hope you can learn from it). Most of this will be from my experience of SAP data.
1. If you don’t know what the data means, how can you interpret it properly. This sounds so simple, but when you stop to think about it, in a giant system like SAP, there is so much data. If don’t know what the data means, how can you possibly use it? In addition, the bigger the system, the harder it is to mix and match the data into something that makes sense to your team.
2. If you don’t know where to find the data, it’s gonna be tough to use. Again, similar to the first point, knowing the data is in there, doesn’t help you find what you NEED to know. In an ERP system, often there is so much data, that getting the stuff you really need can be challenging. SAP for example has so many different dates, that knowing which data you really need to be using can be a challenge. Figuring out the correct data, and then pulling it together to give you the information you need often takes someone with a lot of knowledge about the system.
3. Analysis of the data is key to pinpointing the true issue. Once you have all the information, and you’ve put it into a readable format, now someone needs to look at it and interpret what it means. Take my area for example, Service management. If you have an issue with repairs in-house not happening quickly enough. There are many areas to review to figure out where the bottleneck really is. The issue could be the receiving group not processing the delivery soon enough, it could be that the service order doesn’t get released in a timely manner due to missing parts or lack of capacity. It could even be that the service department doesn’t enter in the data when they need to. If you don’t know what data to look it, you could be solving the wrong problem.
4. If you don’t use the information, things can’t get any better. Now, this is the most difficult of all things to overcome. When an organization doesn’t act on the data they have extracted, things will not improve. As a consultant, this is the most frustrating place to be. Seeing upper management receiving all the data to pinpoint where things are “broken”, but then not taking any actions to improve the the organization. A couple years back, I was a on a project where inventory was in a terrible predicament. Things were in the wrong place, employees were not properly transacting things in the system, and every day it got worse. The entire team kept telling them to perform a full physical inventory, yet the business refused. Instead, they spent days and weeks counting certain areas they believed were causing the issues. All this managed to do was shift the problem around and never solve the issue.
As you can see, there are a lot of things preventing businesses from running at their best. The good news is that of the issues listed above can be solved if you can get someone that does the data, and how to analyze it. The 4th issue… well that’s beyond anything I can offer any help for =)
Anyway, I’m sure I left a bunch of stuff out… but I hope you enjoyed it.