Wednesday, October 28, 2009

USING TECHNOLOGY IN BUSINESS FOR GROWTH & PROFITABILTY

Necessity of a Digital Nervous System (DNS)

With globalization resulting in extremely high competition, organizations are required to meet customer expectations before time, in order to delight them, so as to make the difference. To sustain and grow in the face of competition, today’s companies are required to be very fleet footed to respond to the demands of the market. Therefore, organizations require an infrastructure with built-in intelligence to respond to the market demands, on time. This is achieved through a combination of computers, telecom, software, connectivity and information utility devices. These in fact form the Digital Nervous System (DNS) of the organization. The center of this digital nervous system will be the Enterprise Resource Planning (ERP) software. With Customer Relationship ManagemAdd Imageent (CRM) application and Supply Chain Management (SCM) application added to it, it gives the organization the necessary competitive teeth. Equivalent to a biological nervous system, DNS is a digital system built on a combination of hardware, software and connectivity; making it possible to receive a stimuli, process the same and trigger a response at the earliest. It is a digital process linking every aspect of an organization's thought and actions.

Why do Companies require ERP ?

Many corporates have information flow challenges due to lack of an integrated transaction information system in place.

An integrated transaction oriented information systems is concerned with the seamless flow of data among the business functions of the enterprise, resulting into improved administrative and operational efficiency in the organization. The absence of such systems in the enterprise may result in to following business challenges:

* High lead time in business processes
* High cycle time in business transactions
* High Inventory
* Poor utilization of financial resources
* Poor productivity
* High stock out etc.

The planning and control oriented information systems are concerned with improved coordination and collaboration among different business functions enabling enterprise to be more dynamic and intelligent in decision making. The lack of such systems may results into the following business issues:

* Poor utilization of enterprise capacities and resources
* Unsatisfied customers and suppliers
* Unable to handle competitiveness
* Poor flexibility in demand supply management
* Unable to plan growth and future etc.

Functional Modules of ERP Systems

Activities comig under functions of a company consists of functional module. Financial Accounting, Inventory management, Invoicing, HR management, Production planning, Costing, Maintenence management, Sales & distribution, Customer relationship management, Supply chain management etc are the examples of the functional modules. These functional modules are seamlessly integrated in an ERP package. The entire data of all these functional modules reside in a single database engine and therefore the organization does not suffer from data dis-integrity that normally happens due to multiple unconnected databases that normally exist with many functions of a company.

From a user prospective, an ERP package is all about a central database connected to the customer front end through tools (software technology) and rules (standards and benchmarks).

Expected Tangible Benefits of ERP Implementation

· Substantial reduction in Inventory
· Substantial improvement in manpower and machines productivity
· Reduction in financial close cycle
· Improvement in cash management
· Reduction in wastage and improvement in its management
· Reduction in transaction cost of management

Expected Intangible Benefits of ERP Implementation

· Improvement in customer responsiveness
· Improvement in order management
· Improvement in production planning based on forecast received from sales
· Materials planning generated from the system to optimize inventory levels.
· Automation of the import process with item valuation

· Online availability of the inventory and its valuation, leading to visibility of both raw material and finished goods inventory at all stages
· Product wise tracking of costs and revenue with consolidation of financial information
· Integration of cost and financial books, elimination of the need for reconciliation between the two, improves the account transactions.
· Real time tracking of material price and usage variances, efficiency variance.


Points to ponder:

· Automating what is being done manually is not an ERP implementation.
· ERP implementation is all about implementing a centralised application package to use data intelligently to arrive at informed scientific decisions.
· Reputed ERP packages have many global benchmarks & standards (rules) available in it. Applying it intelligently for organization benefits it a lot.
· Please ensure localization (local taxes, statutory rules etc) possibility in the ERP package.
· Please look for ERP packages with concurrent license. Versus named license, concurrent license offers tremendous cost advantage (saves up to 2/3rd of the cost).
· Look for a package which is easy to use.
· Look for a package which does not call for installing an entire new IT hardware infrastructure (saves cost)
· ERP implementation brings tremendous change management in the organization. Please prepare the management and staff through training and orientation to face the changes.
· ERP implementation is achieved through a top down drive approach. If the CEO is not involved in the organizational change management, it could come a cropper.
· A senior officer with the required level of empowerment needs to be made as the responsible co-ordinator of the implementation. He should have easy access to all functions and its heads for smooth ERP implementation.
· Be prepared to experiment by applying global benchmark in your business practices. You could gain tremendously here.
· If it is deemed as a onerous task by the company, go for ERP implementation in phases. Take up easy implementable functional modules first and go for complex functional modules later in phases.
· To phase out the budget, go for minimum concurrent licenses at the beginning and increase the same over the time, as per the requirement. This allows easy investment in phases.

The post is made to advise corporates and organizations on the importance of applying technology within it for being more customer focused, more process oriented and to avail the benefits of incorporating global standards in its business process. Once upon a time, ERP packages stayed only within large multi and transnational corporates those of who availed the rich benefits that it offered. Now it is the turn of the SMEs. SMEs are playing a greater role in the economy of countries. Therefore time has come for the SMEs to implement such technology solutions so as to benefit from it to meet the business objective of growth and profitability. From leveraging IT, companies are today consolidating IT for profitability and growth. Companies that are not leveraged on technology will get pushed aside. It is time the CEOs realized this and go for incorporating appropriate technology solutions for taking his company forward.



Tuesday, October 13, 2009

OBAMA & NOBEL PRIZE; A CASE OF HOW CAN ONE GETS FIXED

When the news broke out about three days back about the President Barack Obama being chosen as the winner for Nobel Prize for Peace for this year, the first reaction was that of disbelief. It looked like too much too soon. My wife Shali commented; ‘yes, that fixes him’. It was then I ever thought of that perspective.

I had read many books and write ups in the past on how the Nobel committees function. What level of aspirations does it has and how it lets its awards move world opinions and how the award positions people and countries. While from outside it could look like a plain and simple merit based award deliberation, it has to be understood that there is much more to it than that.

Let us come back to Barack Obama. Does he deserve a Nobel Prize for peace? Many comments are still reserved. However suffice to stay that he indeed has the potential of a Nobel Prize winner. His views on peace, liberalism, gender, colour, equity, inclusivity etc are very laudable. After about 8 years of the rule of the Bush Junior, USA had really been tottering on many areas. To add to the agony, there is also the global meltdown that had vanished financial empires and brought the country and its citizens to pits. Most of the above were the result of actions by the yester year’s Republican presidents, beginning with Ronald Reagan. Yes, Obama had indeed brought the change initiative and thereby boosting the hope of US citizens.

In the last 9 months of his Presidency in the US, had Obama done all those actions that had resulted in global peace? Say, had he withdrawn the US military from Iraq & Afghanistan and brought peace there? Had he brought permanent truce between Israel and Palestine? Or because of his efforts and pleading, had Al Qaeda and other major guerilla fronts put down its arms? Had he mobilized the war torn refugees of Africa to a better future? Had he made countries including Iran stop its atomic energy/bomb quest? What had he done so as to receive this coveted accolade?

In fact, the current situation is not that rosy for President Obama. Public support for him is dwindling rapidly. From a popularity rating of more than eighty per cent, it is now hovering around the fifties. He still has not been able to address the American health policy and set it right. The American economy has not come back to its original self –in fact it continues to be far from it-

If you had seen him on the TV on the day of him hearing of receiving the Nobel Prize, he himself was shocked. His eyes said that he never expected it. His reactions were that of the same disbelief that you and I had, when we heard the news first!

Unlike other US Presidents and some world leaders of the past, Obama may not have done the behind the scene activities to get the Nobel Prize for Peace. He truly may not have any expectation of the same and was in the midst of the challenges of managing American economy and health policy. His biggest worries would then have been regaining the popularity rating that he had lost. Lo & behold, there falls the Nobel Peace Prize into his hands!

So now let us revert to the intricacies behind the Nobel Prizes. Why had the committee decided to give it way to Obama? Of course it knew that if there is one world leader who can achieve something on the peace front, it is Barack Obama. Though he had not achieved any of the things that he has set forth to achieve in the peace front, the committee would have felt him slowly slipping away from his dreams and commitments towards the same. And when there is nobody around to take the mantle, it would have felt the necessity to bring him back to his commitments in a manner that he cannot escape from it. Yes, the Nobel Committee had fixed Obama with the Nobel Prize. Does he have any option now? He has been set up for good.

Let us watch for the developments to evolve. And let us also see how the Nobel Peace Prize sits on his head. Amen!

Wednesday, October 7, 2009

WINNING INTELLIGENCE

Several years of working with people gives me a perception that there could be yet another form of intelligence, that can be named ‘Winning Intelligence’. It is based on some simple observations as well as review of scientific research in human behaviour.

During my days of employment, I had come across Ms. Ragini Gupta, a smart, conscientious, industrious and caring girl in the marcom department of the company that I worked. In spite of these qualities, she never got invited to parties and get-togethers conducted by her friends and colleagues. When checked, I was told that Ragini had a ‘fiery temper’ and she was an ‘angry woman’. Nobody wanted to interact with her and be with her. Such a caring an industrious girl but she was alienated by her colleagues because of her occasional ‘fiery temper’

The other day my wife told me the story of her neighbor Anand Menon, a gifted kid, creative and intelligent. He was such a dream child and every mother wanted him to be her son. But late in life, she found Anand making a living out of repairing electrical appliances in his apartments. What happened, she enquired. She was told that Anand snapped when his father walked out of his house before he could complete his school.

In another company there was this brilliant accountant, Ajit Kumar who had an IQ 0f 160+. But whenever promotion came, he was passed over. Because, he was perceived to be a selfish fellow by his colleagues.

These few, out of the easily observable several other instances, denote that inability to manage negative emotions can cause the downfall of people - regardless of learning, knowledge, or intelligence. What we notice in such events around can be verified by review of actual research also.

A study by US Navy had revealed that most effective leaders are warmer, outgoing, emotionally expressive, dramatic and sociable.

Studies in retail segment had found that a store manager’s ability to manage feelings and stress of his sub-ordinates is directly related to net profit, sales per sq ft., sales per employee etc.

A survey on buyers found that apparel sales reps. were valued primarily for their empathy. The buyers reported that they wanted reps that could listen and understand what they wanted.

In a research at insurance major, it was observed those new salesmen who were optimists sold 37% more insurance in their first 2 years than did pessimists. When the company hired a special group of individuals who scored high on optimism but failed the normal screening, they outsold the pessimists by 21% in the first year and 57% in the second year.


Organizations in the selection process usually give high priority to intelligence - in the form of academic brilliance and relayed cognitive and intellectual abilities. These kinds of attributes are not connected to any social and emotional aspects and therefore do not help individuals in managing people - a critical requirement of career progress in organizations.

What is Intelligence?

Out of the several definitions of intelligence, I consider the one by David Wechsler, the American psychologist, the most appropriate one - ‘the aggregate capacity of an individual to act purposefully, think rationally, and deal effectively with the environment’. In effect, Wechsler attributed critical importance to ‘cognitive abilities’, though.
Perhaps, Ragini Gupta, Anand Menon, and Ajit Kumar acted purposefully and thought rationally. Yet, they might have missed the component of ‘dealing effectively with the environment’ - and our environment is nothing but other human beings. This ‘dealing effectively with environment’ is the critical requirement of life and work - especially, in the contemporary world of privatized, globalize, open market economy.

How do we manage with our negative emotions?

Taking clue from Wechsler’s definition, it seems that we need to act purposefully, think rationally, and deal effectively - with our own emotions, especially the negative kind.

Acting Purposefully

The properties of negative emotions are powerful enough to block the progress of one’s life and career. It over-shadows even academic brilliance and job performance competencies. Fear, anger, rage, jealousy, frustration, sadness, anxiety, depression etc are some of them. These emotions when taken into the head result in spontaneous, irrational decisions, and actions that mess up one’s life and work.

If an individual has a strong purpose to succeed in life and work, almost any negative emotion is likely to become insignificant. Most of the detrimental emotions are actually reserved for manifestation before other people. If nobody is around, to whom one would demonstrate her emotions? It is likely that the very basis of emotions is created out of certain probabilities of expectations and behaviours vis-à-vis ‘others’.

It is not about direct ‘suppression’ of emotions. Suppressed emotions manifest later in life in the form of health challenges such as migraine, asthma, palpitations, BP, ulcer, arthritis, depression, mental aberrations etc. And these are extremely dangerous for one’s health.Instead, it is about having a ‘purpose’ in life and work, a clarity about one’s role and responsibility if existence. It is reported that a snake and rat would hold on to the same piece of wood floating in flooded water. That is when a common enemy comes, rivals become friends. Similarly, a higher purpose would mitigate the seriousness of self-defeating or ‘other-defeating’ emotions.

Think Rationally

‘Acting purposefully’ involves accepting the existence of others too, to see things and phenomena from the others’ perspective. For instance, nobody gets wild with a drunkard or a mentally challenged individual, even if he injures or intimidates you. Because, you ‘understand’ his condition. It is called ‘empathy’. Empathy makes us understand other’s emotions. This will give us a service orientation to recognize other’s un-stated needs and concerns and also the ability to read undercurrents of emotion and political realities of a group.The choice and decision to act purposefully would naturally inspire us to ‘think rationally’, to become ‘adaptive’, to develop self-initiative, attending to responsibilities, to improve oneself, and in displaying trustworthiness to others. In fact, intelligence is referred to as the ability to ‘adapt with the environment’. Adapting with the environment, as mentioned earlier, is adapting with relationships. Without proper relationships life and work is near-impossible in today’s world than ever before. Adapting with others involves the ability to help the development of others, open communication, resolving conflicts, practicing team work, and by developing leadership abilities.

Nevertheless, it would involve a certain degree of suppression of emotions.
To take the impact of emotions on our body, we must have a healthy body lest the body would be affected and that would result in our health going down. It is therefore important to care for one’s body. Physical fitness can reduce the impact of emotions on the body. To acquire emotional wisdom, keeping the body fit is absolutely important.We should build upon the emotional muscle every day by taking time to focus on emotional experiences. Slowly we should go through the emotions that we feel and by doing so, we must master them. Practicing is the key. It is something similar to swimming. The more you swim and learn, the better the swimmer you are!By opening your heart to others, you can apply empathy in social interactions. Forever, create an attitude of gratitude in you. We should be thankful to the world and its inhabitants for making our life worth living.ConclusionThus, we may try to re-conceptualize Wechsler’s definition of intelligence: ‘the aggregate capacity of an individual to act purposefully, think rationally, “in order to deal effectively with the environment of people”.

The very purpose of intelligence itself is to facilitate survival and sustenance. Unfortunately, the very activities of survival and sustenance have assumed a high-competition ‘game’. Perhaps, an inevitable consequence of the very intelligence of human beings. The process of learning and knowledge development is a matter of conventional intelligence. But in order to take advantage or to reap the benefits of that learning and knowledge, we need yet another ‘orientation’ to intelligence. An intelligence to win our purpose. Of courses, it is not about defeating others. At least to ‘win over our own emotions’ that tend to defeat our own purposes - great or simple.