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E-biz love-in coming to an end. Part 2

by Daniel on October 3rd, 2011

If you think the answer is yes, you’re dreaming. I’m convinced that every organization getting involved in this new world is going to have a couple of good IT disasters along the way. Think about it. The history of IT is littered with project disasters. All of us are aware of – and perhaps many of us have worked upon – large-scale projects that have gone off the rails. We are so bruised by past experience that we no longer turn our heads when we hear of a $50 million ERP project that is 18 months late, massively over budget and spiraling ridiculously out of control.

So why should projects involving e-biz and the Internet be any different? The fact is, they aren’t, and hence we’re headed for a rather rocky road. We better prepare to deal with that fact. What makes e-biz projects so difficult? It isn’t necessarily the technology, even though much of what we might be working with is bug-ridden and barely of passable quality. It’s the people. It’s the processes. It’s the procedures.

We are talking, in every company and every industry, of an absolutely massive change in the way that business is conducted, information is processed and procedures are undertaken. Good gosh, I’m typing this in the lobby of an emergency room while waiting for a “boot-cast,” having broken my toe. Surrounding me is one of the most complex information systems in the world – a hospital. Can we fully expect that IT professionals will be able to apply the tools of e-biz to this industry overnight? Not a chance.

Extend this line of thinking to the insurance industry. You couldn’t get a more paper-intensive industry if you tried. Each policy, each claim, each customer involves a huge amount of forms filed in duplicate, triplicate and beyond. One estimate suggests that some $1 billion a year is spent in the U.S. simply moving around the certificates of insurance that are required when the risk of a policy is shared amongst multiple parties. There couldn’t be an e-biz application that makes more sense. Let’s use the tools of e-commerce to allow multiple organizations to access and share this information online. Surely that will save us money.

And yes, it is a strategy that makes good sense. But it is probably a project of horrific scope and complexity – not just for the technology, but because it will involve changing the day-to-day working procedures of tens of thousands of people. You can’t do that overnight. And yet many people in IT, enamoured by the potential of e-biz in the insurance industry, expect that they’ll be able to walk in overnight, reengineer work processes, squeeze efficiencies out of the systems and achieve magical cost savings.

Good luck. Anyone involved in putting in place any type of document management system knows that the effort is truly horrendous. People don’t like change, and most of our effort is going to go towards helping them along.

That’s why the issue of “change management” is going to become even more critical than it is today with IT through the next several years. I’m now spending a great deal of my time in working with companies talking through the issues of complexity.

Of course, for every dark cloud, there is a silver lining, and from a career perspective, it is this: there are going to be jobs and opportunity in abundance. Not necessarily with the technology, but with the implementation and management of projects involving the technology. If you think it has taken a long time to implement IT in the business sector, then you haven’t seen anything yet.

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