SaaS Notes

Organizational Leadership - Preparing Leaders for Virtualizing the Business

Virtual business success begins at the top with Internet savvy leadership. A previous blog provided a short list of questions to help determine leadership readiness for executing on a virtual business strategy. What do you do, then, if after reviewing the leadership readiness questions you discover the firm's leaders are not ready to go virtual? This post explores a few of the most common hurdles of leadership readiness and how to overcome them as you build your busienss case for taking the firm virtual.

1. Leaders cannot move to virtualize business processes if the processes are broken.

This may seem obvious, but it is amazing how many companies are limping along with broken processes. Some examples I've seen include multiple order entry systems, disjointed service support systems and disjointed sales and service systems. When sales associates are required to input the same information into different applications, there is a serious problem. When service cannot proactively reach out to customers to renew maintenance contracts and add the recent purchases to the contract, there is a problem.

Before a firm can even consider virtualizing its business processes, the processes must be cleaned up. Incrementalize the clean up to ensure the project is small, manageable and quick. Build on small rapid successes. This is also the time to ensure the business issues are integrated with the technology. For example, improving the company's billing cycles by tying billing into spare parts ordering. As you work on cleaning up broken processes keep two critical questions in mind: Does the solution improve customer satisfaction? Does the solution improve the business in some manner?

2. Leaders need to create a culture of communicating information.

The difference between data and information is that information is actionable. Leaders who take advantage of the vast body of knowledge within the organization are better informed on process friction points and the variety of solutions available to address them. Those employees that are in the middle of the process flow and experiencing the hurdles are the best suited for seeing opportunities to improve the flow. Middle management tends to impede upward communication. Their removal, while widely desirable, is highly impractical for a plethora of reasons.

This is the perfect application for implementing internal social networking. Social networks only work when all the parties involved have a vested interest in the topic. In the case of process improvement, those involved in the process are anxious to have the friction points resolved. It benefits the leaders and the company to implement process improvements. It also enhances employee satisfaction, in turn, increasing employee retention when they feel like their suggestions for company improvements are being heard and addressed. When the employees are happy, you can be assured their positive feelings for the company are reflected in their interactions with customers, improving customer experiences. Effective, bi-directional communicaiton between the company leaders and the employee-centric knowledge base can only benefit the firm.

3. Leaders need to plan for process change.

Process change is required for companies to remain competitive in a 24/7, global market. It is unrealistic for firms to do a technology rip-and-replace in today's economic environment. Starting with the end in mind allows leaders to communicate the e-Business vision the firm is pursuing. However, communicating the vision is only part of the solution. Leaders need to understand how the interim process changes will impact the company and all the employees involved. It is reasonable to assume that process improvements will lead to automation and elimination of some roles. By planning for process change, employees can be trained to perform other functions within the organization that generate more intellectual property, adding greater value to the overall company. Planning for process change also means being prepared to educate and train employees to work within the e-Business model.

This list of virtual business leadership readiness hurdles and potential solutions is not comprehensive. There are numerous ways to support busienss leaders as they momve toward implementing virtual busienss processes and strategy. The goal is to get you thinking about how to move your firm's busienss processes into the virtual environment and how to get the leadership team on board with the strategy.

The next post will explore the idea of IT Governance and how governance readiness can smooth the road to implementing virtual business processes.