Digital transformations and IT projects can be extremely costly and if you’re not a business leader with a tech specialism, it’s not always easy to hold your project team to account. Join Everest Managing Director, Samuele Armondi in this hands on, one hour session and learn how to keep control IT projects.
What British cycling can teach us about software projects
When it comes to software projects, it doesn't have to be a case of delete everything and start again, says Everest Managing Director, Samuele Armondi. A series of marginal gains could constitute a transformation for your business without the cost and risk.
Transformation. Overhaul. Pivot. Version 2. So often we hear clients and prospects tell us they are planning a large project to digitally transform, but this can translate into projects which are expensive, complex and risky. Does a digital transformation really require businesses to invest in a complete overhaul?
Truth be told, it’s human nature to equate big change with big opportunities. Out with the old, in with the new and profits will follow. And it’s true, sometimes a replacement is the only way to go. But more often than not, Pareto’s Rule applies – 80% of the business reasons for a large project relate to 20% of your processes or systems. And inside that painful 20%, it’s highly likely that there are lots of small improvements than can be made. Individually, those improvements may not account for a great deal, but together they can add up to a large difference in performance.
This is often referred to as ‘Marginal Gains Theory’, or the ‘1% rule’. Put simply, you don’t need to be twice as good to get twice the reward. Being consistently 1% better can be enough. A brilliant example of this is the transformation that Sir Dave Brailsford brought about in British cycling. To set the scene, British cycling had been mediocre for almost 100 years. In 110 years, not a single British rider had won the Tour de France and we had only managed one Olympic gold medal.
British riders were so poorly regarded that one of the top European bike manufacturers refused to sell bikes to the team because they were afraid that their sales would suffer if other professionals saw British riders using their gear. Against this backdrop, Sir Brailsford took charge of the British cycling team in 2003. Within five years, the British team won 60% of the golds available at the 2008 Beijing Olympics. At the London 2012 games they won 70% of the gold medals available, and set nine Olympic records and seven world records. How did they do it?
"The whole principle came from the idea that if you broke down everything you could think of that goes into riding a bike, and then improved it by 1%, you will get a significant increase when you put them all together," explained Sir Brailsford to the BBC. In his search for 1% improvements, he looked at everything from cleaning (dirt in the team’s transport lorries was causing bike maintenance issues, so he had the floor painted bright white to spot any dirt) to hand washing (he hired a surgeon to teach riders the best way to wash their hands to reduce the chances of catching a cold) to clothing to saddles to everything else that goes into making a rider go really fast on a bike. Everywhere he looked, he found small improvements that then added up to a transformational impact.
Can this reasoning be applied to digital transformation initiatives? Yes! Given that only around 30% of transformations succeed in larger organisations, anything that can be done to reduce complexity and scope has to be a good thing. In our experience, we often find that the ‘painful 20%’ is found in those areas where data, processes or workflows need to cross from one system to another. Typical examples include:
- Operational data being transferred to finance systems for things like billing, management accounting, or reporting
- Integration between sales (from a website or a sales team), account management, fulfilment, follow-up and finance
- Getting accurate business-wide reporting
- Integrating newer websites with legacy ERP, CRM, financial and other systems.
In each one of these areas, just a 1% increase in efficiency can lead to significant improvements. For example, we recently helped a successful e-commerce fashion retailer to integrate their sales, stock control and billing. Rather than replacing anything, we were able to identify small process improvements and find a suitable middle layer that took the problems away. In just 2 weeks, our client was able to almost halve the time taken to process orders and reduce debtor days by over 50%.
So how does the Everest team do it?
Business first, tech second
Consultants often approach problems from the technical angle. They look at things like non-functional requirements, integrations, support life span, total cost of ownership, and so on… these are all really important things. But it’s the wrong place to start.
Everest uses an initial Discovery phase to start by getting a clear, shared understanding of the challenges we’re trying to address, and crucially how they are impacting the business. We use our home-grown Discovery framework to make sure we look at this from all angles, front-to-back (from prospective customer through to post-sale, renewal, or whatever comes next) and top-to-bottom (from board level to individual work processes and systems).
Once we have a clear understanding, we make sure we agree what success looks like. We distil our client’s vision into a succinct set of success criteria that tell us exactly what we’re aiming for.
When we have all that, we apply our ‘one page’ rule – if we can’t sum it up on one side of A4, we need to understand it better until we can.
The simplest solution
Pareto’s principle has been proven over and over and our team dedicates significant effort to zeroing in on the pain points within business workflows.
Once we’ve worked out what specific issues are, it’s a case of evaluating the solutions available against clear criteria.
We take into account your future plans, estimating growth and future needs to avoid you having to revisit the solution once your plans succeed.
One step at a time
Implementation doesn’t have to be painful. We break out projects down into ‘sprints’. This means you see value in your business quickly, and can rapidly assess if the solutions we’re putting in place are having the impact you need them to have in your business.
Are you ready?
How many 1% improvements are hiding in your existing processes? A Discovery with the Everest team could be all it takes to assess the opportunity for transformation through marginal gains.