We all played the old game “rock, paper, scissors” (aka Rochambeau) to settle a dispute or just for fun. Everyone knows the simple hierarchy that forms a path to victory - rocks crush scissors, paper covers a rock, but scissors cut paper. This is a lesson we learn as children, but such simple hierarchies of superiority can govern outcomes in professional life too.
For example, solutions to a problem have always, since the beginning of our species, involved a three-element formula – people, process, and tools. If we apply this formula to something simple like digging a hole, the ‘people’ part may be a person that is a trained digger, the process is to select a location for the hole including specs like depth and width, the method by which the tool will be applied to complete the task, etc...and finally the tool involved...in this case a shovel.
Of course, the tool is important, but it should be obvious that even with the most glorious tool available, the shovel cannot complete the task by itself. (Not until we get robotic shovels, but this isn’t the point!)
So, let’s apply a version of our rock, paper, scissors hierarchy to see which combinations of outcomes achieve the objective.
- Untrained person, bad process, excellent tool = fail.
- Trained person, bad process, excellent tool = fail.
- Trained person, good process, weak tool = success (albeit with greater effort).
- Untrained person, good process, excellent tool = success (the tool would have to compensate for the skill gaps with the people.)
You can run every permutation of this hierarchy in your mind – as I have – and here is my conclusion: You need at least two of three solution elements to be good to achieve success and one of those must be a good process. However, most solutions treat process as the lowest consideration!
Let’s correlate that to EPM, Analytics, and every technology-based solution every organization has tried to implement. Advances in technology are exciting and very compelling as to what can be accomplished, but of the three solution components required:
- The strength of the technology is the least indicative factor for success. Highly effective people and a productive process will carry the day even if the technology is suboptimal.
- But then, technology and people, no matter how well configured and prepared, cannot out execute to overcome a poor process. Since process is so important, you’d expect vendors to be articulating precise instructions to follow to ensure their customers have consistently successful results - unfortunately that is not the case. The default is to assume that the existing process is perfect as is, and the improvement will come from the implementation of the new tool with the same process and same people.
- We don’t dispute that there are some benefits to acquiring a better shovel, however the benefits will be limited more by the process and the limited skills of the people.
In accounting, there are millions of certified accountants who rightfully tout their credentials as qualification to participate in the process of business accounting. There are certification boards, compliance courts, and government agencies all arrayed to enforce these definitions to ensure absolute compliance.
There are no equivalent certifications, published standards or oversight agencies for processes within EPM disciplines like budgeting, management reporting, and analytics. The output of these systems is rather arbitrary, and quality and effectiveness vary widely from company to company.
We believe the primary reason for poor outcomes and variability across organizations is the lack of appropriate process
But what can be done? Column5’s response is to define our own advanced process we call “Dynamic Networked Analytics” or DNA.
This framework specifies standard capabilities that our customers view as competitive advantages. The DNA blueprint has organizational (people) structures to operate and support the solution, standardized business processes, and rigorous technology requirements to fully support the solution.
The historical lack of definition on process in this solution area will not remain for long. AI is putting extreme pressure on the status quo to embed process in the technology to ultimately replace humans. In fact, AI depends on this integration to be seamless. Revisiting our analogy of rock, paper, scissors above, AI covers technology, embeds process AND even in some cases replaces people to promise the potential for flawless outcomes.
In order to embrace and adapt to this new reality, the entire business management process needs rethinking to embrace technology and be compatible with a hybrid workforce of human and automated workers. In addition to our DNA process framework above, the Column5 team is recognized thought leaders on the topic of applying analytics to improve processes.
It’s clear…we have a strong vision, have so much to say and want to share our insights about how your organization can benefit from this time of transformation. Our customers have a lot to prepare for and we believe this dialog requires an extended conversation to address changing stages your organization will face over time. You cannot get all you need to know in one sitting or reading one article or book. Therefore, we are changing our long established EPM Summit to put in place the necessary education and dialogue to plant and nurture the seeds of transformation in your organization.
We look forward to hearing our thoughts on this topic. To join the discussion post on this blog or shoot me an email.
David Den Boer, Founder, Column5 Consulting
Who’s leading the way in AI and how it affects technology?
Column5 – join our new EPM Summit Network Membership to be part of our deeper
discussions and stay ahead of the Rock, Paper Scissors challenge – you know it’s coming.