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Change is going to come, Microsoft predicts

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24th Mar 2009
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MicrosoftAt Microsoft's invitation, John Stokdyk discussed the implications of business change for ERP software users with a group of expert panellists. Read the text preview before you see the movie on Microsoft's website.

Like most good business software companies, Microsoft invests a lot in research to find out how customers feel about their business circumstances and the applications they use. This month, Microsoft Dynamics UK product marketing director Gary Turner hosted a roundtable discussion at the company's London base to chew over the findings of a survey of 500 business directors with a panel that included Cranfield academic Mike Bourne, Andrew Birch from I'Ansons (featured previously in a case study on AccountingWEB), Ovum analyst David Mitchell and me.

Microsoft research: Key findings

  • 57% said they are experiencing more change than they were a year ago, but 38% expected to see little change in the next 12 months.
  • 26% had gone through some kind of corporate transaction in the past 12 months - merger, sale or acquisition; 15% anticipated this happening to them in the next 12 months.
  • Proactive change is more successful than forced change. It's better to identify need for rationalisation and plan for it than to have it forced on you.
  • Technology infrastructure was most commonly cited as an area for change (54%), followed by new product and service developments (51%); marketing/brand (48% and business systems processes (46%). With some variations, these were also the most successful areas, with tech infrastructure cited by 81%, product/service development 79% and business systems/prcesses (79%)
  • Survey categorised respondents as: Change Pioneers (37%); Change Reactors (28%); Change Followers (29%); and Change Resistors (3%).
Coming soon will be a video of the session, part of the new multimedia approach to market research that prompted a few musings in my latest Editor's Blog, We're ready for your close up, Mr Stokdyk. What follows is a short summary of the survey findings and subsequent debate - I'll try not to ruin the suspense.

The results of Microsoft's Preparing for Uncertainty survey were perhaps a little undercooked - it seems there's a lot of change about, and different people feel and act differently about it (see right), but the discussion that followed was lively and informative.

Cranfield's Mike Bourne attempted to refine the idea of predictive and reactive change by examining the underlying factors, which could be driven by a desire to change products and processes, or to cut costs. "Reactive change can cut capabilities and staff," he noted. And while changing the technology infrastructure was relatively straightforward, cultural changes are the most difficult to implement.

David Mitchell of Ovum added that companies are typically excellent at customer intimacy, product innovation or internal efficiency - but if you push forward on one front, you need to make sure you don't neglect the others.

Andrew Birch confirmed that this had happened to some degree at I'Ansons, but after focusing on business process and technology change for a while, staff responded positively and embraced a more questioning corporate culture, turning the company from a Change Reactor into a pioneer.

Microsoft's Gary Turner wondered whether technology change and innovation had stagnated in the business sector since the 1990s. While companies continued to run legacy systems, consumers were adopting ecommerce in a way that contrasted with their experiences at work. "There's a friction between individual aspirations and clunky business technology," he suggested.

Bourne pointed out that one reason innovation may have slowed was due to consolidation in the industry around a small number of IT vendors. It was also important for companies to understand that the point of undergoing technology changes was to get competitive advantage. "You only get an advantage if you do innovations well."

Mitchell agreed: "You get very little competitive advantage from a general ledger. Mobile applications, voice and the like are not the same as automating a GL." Companies are often lured into change by shiny new technology, which often brings along baggage of a major upgrade to get to the innovations.

"Customisation is for life, not just for Christmasm" Mitchell quipped. "If you go early, you may find that 2-3 years down the line the things you have customised are now standard modules and the changes you made can prevent you from taking products forward."

In those cases where ERP nearly killed a business, the problems often did not lie with the technology itself, he said. "Often it's project management, the business changes or the lack of buy-in that are at fault."

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