If you were stranded on a desert island for years, would you be clad in the trendiest togs when the rescue ship finally found you? Of course not. Similarly, if your IT department has been a world into itself, the odds of its being au courant when reality bites are practically nil. Most information systems departments at catalog and retail companies are isolated outposts clinging desperately to outdated views of their role in the control of information and application technology. Like mismatched stripes and plaids, retail IT organizations and their purposes are out of kilter.
An information system is made up of many layers that involve communications, protocols, hardware environments, data management, application environments, user tools, and human interfaces. Each layer in the stack has its own inherent rate of change. A popular principle called Moore’s Law postulates that the power of computer processing doubles every 18 months. But surprisingly, the need for processing speed has very little to do with systems becoming outdated; rather, the expiration of a standard within any or all of the system’s layers can act as an impetus to reinvent the entire stack. This has resulted in a rate of change that requires a retail or catalog business to replace its enterprise or operating systems at least every four years. By contrast, the structures and disciplines of a typical IT department refresh themselves at intervals of 12 years or more. Cunningham’s Law, therefore, states that “technology systems develop at a rate three times faster than that of human systems.”
Dare to bare
As a smart retailer, how do you assess the nature of and need for change within your information systems environment? The checklist at left lists warning signs that your IT organization is passé. As you read the checklist, keep the following points in mind:
If your IT department believes that anything to do with information management falls into “systems” territory, bring up the analogy of a hypothetical “Ministry of Community Highways and Highway Activity.” Your community centrally manages its roads, but does that mean that the community must also manage the car that you drive, the delivery time of furniture to your residence, or the times at which you go out to dinner? IT departments have mistaken their responsibility for data and data technology for authority to manage the scope of data usage and decision-making tools as well. Remember that information technology, data management, and application development are separate tasks with separate missions.
Note also that IT usually maintains a long list of things to do classified by some kind of priority. These things rarely get done, and are usually a graveyard of user requests that should have been executed by a systems-skilled user to begin with. Over-reliance on key IT department members who “do it all” is one of the most common initial signs of a problem. There should be a clear distinction between maintenance and development staff, as well as between personnel who perform other unique functions.
Another danger is to let IT wander too far afield. It’s not a good idea to allow systems people to design your order fulfillment operations or DCs, or to develop facility operating procedures and worker training programs. Likewise, inappropriate use of functional specifications can be a recipe for burgeoning costs and eventual disaster. Your IT department shouldn’t write extensive specs to design and bid for systems that vendors already supply or can modify. The CIO or other IT head should not be the sole person supervising in-house applications development, finance, operations, or store management.
Evaluate whether your IT unit resists the growing intertwining of the user and applications development. The user tool and user interface layers of the future will be user-designed, user-developed, and user-integrated. Stand-alone report development tools like Crystal Reports are already common in the industry. If there’s one addendum to Cunningham’s Law, it’s this: The order fulfillment center of the future will be staffed by development-savvy users who write their own staff management, productivity tracking, production tracking, and volume planning tools.
Roger Cunningham is a partner at Atlanta-based distribution consulting firm DCB and Company. He can be reached at email@example.com.
Fashion Faux Pas
If your IT department does any of the following, it is cloaked in outdated practices:
- Proclaims that all information management activities reside under the“systems” umbrella
- Maintains a list of information systems improvements that are scheduled to be done but never get completed
- Fails to distinguish between maintenance staff and development personnel
- Wastes time writing functional specs for systems that vendors can readily provide
- Designs your order fulfillment operations and distribution centers
- Sets up facility operating procedures and floor worker training programs
- Has in-house apps developers report solely and directly to an IT boss
- Refuses to understand that handling data, developing apps, and managing information technology are different disciplines
- Has finance, operations, or store management reporting to the CIO
- Resents users’ increasing closeness to applications development