Daily Archives: April 14, 2011

It’s Easy To Move Beyond Spreadsheets and Improve Operational Decisions

All you have to do is survive the uprising that results when you ban spreadsheets from the organization.

Industry Week recently published a very nicely thought out and written piece from SAP on “how to move beyond spreadsheets to improve operational decisions” using business intelligence that sounds wonderful in theory but doesn’t work in practice. Why not? Because the first thing a user does when they get a new system is dump the data to a spreadsheet they can play with because

  1. they are used to the spreadsheet environment and
  2. the vast majority of BI tools don’t have the capabilities the average analyst needs to do the analysis she needs to do because they all work off one version of the data that cannot be altered in any way.

Thus, an average BI system only worsens the problem as users create and share more and more spreadsheets in an effort to get around the limitations of yet another system with yet another version of the truth. There are only two ways to move beyond spreadsheets. They are:

  1. Ban Spreadsheets
    and force your users to work within the limitations of the BI tool or
  2. Adopt a Real Analysis Tool that Supports a Spreadsheet Interface
    and allows your users to continue to use the interface they are comfortable with in a productive, value-creating, manner

Spreadsheets are not going to go away just because you’ve introduced yet another system. It’s delusional to think otherwise. Your only choices are to ban them or embrace them in a manner that is actually helpful.

What Do You Want?

One thing is for certain, the CPO Agenda knows how to get your attention these days. As soon as I saw the headline for their recent executive debate on “what comes first, quick bucks or big changes”, all I could say is “well, that depends on what you want“. Are you just in it to make a buck, or are you in it to make a career. A career requires long term viability, and that requires the willingness to make big changes when big changes are necessary. Continue to do it right, and the market, with its money, will come.

But I guess the answer is not that easy when management is divided, or you want to keep your job (though I personally don’t see why you would want to keep a job at a company with no vision of the future, as it won’t likely survive this economy without one, but I have to respect a healthy fear of the current job market, or lack thereof). To this end, you could take the advice of Laurence Laroche of Saint-Gobain Packaging — quick wins are a means to gain this credibility [with purchasing] and then transform the function, and do a few quick wins to get respect and then start the long-term transformation.

The real question is whether you can pursue quick wins and long term transformation at the same time. As Xavier Cassignol of FCI points out, it is difficult to do both at the same time, especially when purchasing needs to be constantly in tune with the broader challenges facing the organisation. Especially when product lifecycles are shrinking along with average management tenure. For better or worse, a manager is not likely to survive four years if she doesn’t show increasing returns in each of the first three years, which is difficult when real transformation efforts often take two years in a multi-national.

But you still need to constantly improve. We’re in a perform or perish culture, and it’s not always easy to keep up, so getting ahead of the game can be a real challenge. And you can’t ignore your long term supplier relationships, even if another supplier tries to woo you with lower costs, because quality, reliability, and fit is important too — so you have to continually improve in supplier relationship management too.

And, as Mohamed Marfouk of LVMH notes, if you do continuous improvement right, each step is going to happen faster and faster, because you are building on success, you are building credibility. As you build success in marketing then R&D will want to be your customers and so on. You must carry out your own marketing internally so that other people know what you did and that it worked. This will drive more customers, which, in turn, means you get greater resources and you deliver more. It is continuous. Especially if you start with getting the right team, as I pointed out in step 1 to building a world class supply management organization.