The new hot topic from the proponents of social, of which I am one, is ‘engagement platforms’. In a blog from August 28th titled ‘ The New Engagement Platform Drives The Shift From Transactions’ Ray Wang states that:
If Business Value And Outcomes Are The Goal, Then We Need An Engagement Platform For The Enterprise The arrival of engagement platforms does not signify time to throw out the transactional systems. In fact, those systems provide the foundation required for engagement. The engagement layer exposes transactions and allow for deeper interaction and richer sources of information. However, the transactional systems lack the ability to support engagement. …While crafting the right strategy should be designed prior to any technology selection, once completed, the technology to support the strategy does not exist out of the box from ANY solution provider. Unfortunately, the technologies to achieve engagement remain disparate and hodge podge.
While I agree with what Ray writes, there are two critical capabilities that are needed to make a solution relevant to the enterprise space. The first is to take social network concepts and convert them into a responsibility network. In business, specific people need to act, so messages/alerts need to be directed, not broadcast to everyone. Secondarily there is the need to separate the urgent from the important, to increase the signal to noise ratio. In other words there is the need to be able to evaluate the business impact of a piece of information. This was captured by @tdeballion in a tweet on Ray’s blog.
It is that ‘why, who, and how’ that is so important in the enterprise, particularly for Operations and Supply Chain. For example, a supplier may decommit from an agreed delivery date. Who needs to know and why? The answer will depend on each person’s responsibility. Clearly the purchasing agent should be notified. Who else? Well, that depends on the impact the late delivery has on the rest of the supply chain. If it is going to mean that a production plan needs to be revised then someone in manufacturing needs to know, but whom? How do you determine the person to tell when your supply chain is outsourced? If the production plan needs to be revised, is there a revenue and customer service issue? Which customers are affected? Who should know about the revenue impact and who should know about the customer service impact? As I commented in 2011 in a blog titled “Who should know?” The key to the use of social networks in the supply chain, tremendous value is added by determining:
- What are the downstream and upstream impacts?
- When will these occur?
- How much do these impact performance metrics such as revenue, customer service, equipment utilization, etc.?
- Who needs to be informed and what actions do they need to take?
What is also required is a collaborative environment in which the people impacted and responsible for taking action can evaluate different scenarios to determine how to overcome the issues at hand. They need to be able to run rapid what-if analysis to determine the operational and financial impacts of a decision in order to make trade-offs across competing function and organizational metrics. We call this an Operations Control Tower, in which orchestration across multiple functional boundaries is a requirement. To be fair to Ray, he does address some of this in his blog. The system capabilities Ray identifies are:
1. Multi-channel bi-directional sensors. 2. Decision management and analytics. 3. Context engines. 4. Complex event processing (CEP). 5. P2P architectures. 6. Interaction histories 7. Business process management (BPM) and adaptive case management (ACM). 8. Master data management (MDM).
Reading through my description of the supply decommit you can see how many of the systems capabilities are used to satisfy the business problem, for particularly P2P Architectures, Complex Event Processing, and Adaptive Case Management. In reality probably the only less relevant capability is sentiment analysis, but the closest Ray comes to responsibilities is in his description of P2P Architectures. I feel that we also need to describe why this is happening and therefore why engagement platforms are of business value. Ray takes it for granted that these are trends without explaining the business context. I am sure he is aware of the underlying trends. He just doesn’t state them in his article. In this context Accenture published a very interesting piece recently called “Corporate Agility: Six Ways to Make Volatility Your Friend” in which they refer to my all-time favorite a Harvard Business Review article by George Stalk of Boston Consulting Group called “Time – The Next Source of Competitive Advantage”. The key passages in the article in terms of business drivers are:
GE’s CEO Jeffrey Immelt nicely summed up his team’s perspective on the need for agility: “When the environment is continuously unstable, it is no longer volatile. Rather, we have entered a new economic era.. . . Nothing is certain except for the need to have strong risk management, a lot of cash, the willingness to invest even when the future is unclear, and great people.” To be sure, the rise of volatility and market turbulence merits far more attention to getting risk management right. But there is—or should be—more to it than that. Accenture has found that several high performers view ongoing uncertainty as non-stop opportunity.
In other words, increased demand and business volatility is requiring a different way of operating, which in turn makes many of the technology trends Ray highlights attractive as process enablers. Accenture summarizes the process needs, and therefore business needs, as:
- The strategic lens: Opening up more options
- The leadership lens: Ensuring that agility starts at the top
- The organizational lens: Overcoming “transformation fatigue”
- The market lens: Sensing fast and responding faster
- The operational lens: Avoiding the “lean is good, leaner is better” trap
- The financial lens: Saying goodbye to the annual budget
Above all else these require the ability to know sooner and act faster, with confidence, all leading to visibility, agility and alignment. More explicitly this requires:
- Contextual visibility – what does it mean and who should care? In other words, insight.
- Process agility – every second we give back to the physical supply chain by making decisions more quickly provides flexibility that increases exponentially·
- Value alignment – which is all about trade-offs because if people/functions/orgs cannot see what is in it for them they will undermine the decision.
I’m very excited about all these trends. It is the fruition of so many broken promises over the past 15 years since functional supply chain solutions such as demand planning and factory planning first because popular. Finally there is technology that comes close to matching the vision of end-to-end value chain orchestration. It isn’t correct that, as Ray writes, “the technologies to achieve engagement remain disparate and hodge podge”. Not in the supply chain space anyway.