A shared single vision of the future

Formulating the IT Architecture for any company is about strategy not technology. Business owners and IT folks have to come together and unify behind a vision that will drive business value for the company.
If there is a common consensus as to where the Organization is going, it will be easier to plan how to get there, but this is a lot easier said than done. Often times Companies don't have a clear and defined strategic plan and/or they don't involve their IT office on the discussion. I think this is a recipe for failure.

A few months ago, after doing some research, I presented an idea to the CFO to invite Gartner to help the Organization in creating an Enterprise Architecture that would focus in putting together a strategy for IT that would drive value for the business in the short and long term. The idea was simple, get every decision maker together and make sure that everybody has the same goals and the same vision and start building an IT strategy from that point. Although the idea was rejected at the end, the premise is the right one, for IT to succeed a shared vision for the future has to exist between the business leadership and IT.

Without a proper Architecture you will not be able to address increasing system complexity, The IT function will not be funded properly, and the IT systems will not be aligned with business strategies.

Why you should consider updating to Contract Manager V13.

Oracle Contract Management version 13 introduces new features out of the box that will help both users and administrators.

As mentioned on Oracle's release value proposition for CM v13, some of the new functionality and enhancements are within the following areas

• LDAP
  
• Content Repository
  
• Web Services
  
• Version control
  
• User Interface
  
• Configuration Utility
  

I will briefly describe some of them below as per Oracle's document.

LDAP

This functionality will allow administrators to connect to LDAP Servers and import or update users and their attributes into Contract Manager.
In my opinion this is a great new feature and long due in the software. It will reduce the administrative time managing users and also reducing the amount of username and passwords that a user has to maintain.

Content Repository

Contract Manager V13 now offers two different ways to store documents: the original way which is selecting a location on the file server and the new feature that will give you the ability to connect to a content repository like

• Jackrabbit
  
• Microsoft SharePoint
  
• Oracle Universal Content Management
  

Connecting to existing document repositories have a few advantages, like more secured access, the ability to search for documents using the repository tools and the ability to leverage and integrate those repositories with Contract Manager. The question is whether Contract Manager will also allow interfacing with other Content Management systems like EMC Documentum or Columbiasoft Document Locator trough native APIs.

Version Control

Version 13 will offer the ability to automatically version documents upon each save or on demand from the menus. This feature will give us the ability to store snapshots of the document's history providing an audit trail over the life of the document.

Web Services

Web Services have not been introduced as of yet, may be with the release of Service Pack 1. This feature should extend the data exchange between different applications like your Estimating or Accounting Systems, and also be able to automatically input data into Contract Manager. This feature will introduce a new series of integration possibilities.

That said, if you planning to upgrade, and Contract manger is part of an ecosystem of integrated applications, you have to do your due diligence. I have been looking all over the Web and I haven't been able to find out any Architectural document of the new release, to see if they were any changes on the DB schema or in the APIs.

 

 

When bad politics affects company performance

Wikipedia defines office politics as follows:

 "Is the use of one's individual or assigned power within an employing organization for the purpose of obtaining advantages beyond one's legitimate authority? Those advantages may include access to tangible assets, or intangible benefits such as status or pseudo-authority that influences the behavior of others. Both individuals and groups may engage in Office Politics."  Office politics has also been described as "simply how power gets worked out on a practical, day-to-day basis"

What happens when bad politics is affecting company performance?
How do you deal with company 'yes-men' in senior leadership positions that are more concerned with self-promotion than fulfilling company goals and how to influence changes on those behaviors without risking your own career ?

These are questions that I have asked myself in multiple occasions, and although I do not have the answers, I think it should exist mechanisms inside every company that would avoid bad politics to stay in the way of reaching higher goals and better performance.

I would like to know your thoughts ?

Why the Estimating process should be modernized

The top priority of the Estimating process is arriving at the accurate Job Cost. In this era of increased competition, uncertain economy and tight profit margins, the better the accuracy margins, the more changes to be successful during the bidding process.



Most Construction companies use Estimating Software will handle Estimating mechanics like:

• Centralized estimate management
  
• Third party cost Items
  
• Historical work estimates
  
• Cost escalation factors over project life cycles
  
• Real-time cash flow analysis
  
• Detailed earned-value reporting
  
• Team collaboration
  
• Standardized best practices and much more.
  

But the use of Estimating Software is not enough to produce winning bids. In order to produce a good Estimate some of the following key items should be tracked:

• Job labor Costs
  
• Equipment, Material and Subcontractors cost
  
• Learning curves
  
• Estimated costs vs. Final Project costs
  
• Historical activity cost
  

Without the proper mechanisms to gather these Job Cost metrics and feed them back into the Estimating process, it will very difficult to guarantee close to 100% accuracy levels.


 

Foundation for execution – A case Study

Foundation for execution is defined as the IT infrastructure and digitized processes automating a Company’s core capabilities*. In order words the collective use of business processes, technology, infrastructure and governance that will support a Company’s strategic goals.

You cannot have a good foundation for execution if a tight alignment between strategic business outcomes and IT capabilities are not in place. IT will continue to be a Cost Center and value will not be generated through the implementation of Technologies.

In this and subsequent Blogs, I will try to focus mainly on midsize Construction Companies (anywhere from $75 M to $ 500 M in annual revenues) and attempt to build the architectural framework for a Foundation for Execution.

Typical midsize Construction Companies have a framework somewhat similar to the one I show on the Figure below where a set of core business processes are supported by technologies, applications and data silos that all seat on top of the Corporate Infrastructure.

This approach seemed to work fine in the past, but with recent advances in technology and organizations trying to gain competitive advantage through innovation and the leverage of smart business aligned IT solutions, companies are looking into building better and more advanced architectures that will allow for more agility and effectiveness.

Some of the flows of this Model are as follows:

- Applications work fine individually , but they do not interact between each other

- Company’s data is located in information silos, is error-prone and not up-to-date

- Strategy is not clear to act upon

- Company builds IT solutions to solve certain business needs instead of building IT capabilities based on sound strategy.

The next step towards a Foundation for Execution is shown on the figure below

This model is similar to the one above with the advantage that attempts have been made at integrating the different applications and technologies that support the underlying processes and the data with an integration middleware, and the data have been somehow warehoused.
Although this approach is a step above the previous one, still have some flows as are depicted below:

- The Data warehousing is only useful as a reference

- There is no real-time data transfers across applications

- After the fact integrations are always complicated , costly and prone to errors

- Integration depends on actual and future releases of the different applications used, so the bigger the application pool the most complicated the integrations becomes.

Despite these flaws, this Architecture still brings value to companies that are using it due to the fact that

- It will allow reporting across multiple processes, thus being able to track compound Performance Indicators that are dependent not just on one process but on multiple ones.

- Efficiency will increase due to the fact that multiple key entries are practically eliminated.

- Data can be are manipulated, rearranged and presented to the knowledge users with the use of the Integration middleware without user input, saving costs due to data manipulation or moving it between different systems

- Information needed to make key decisions is more easily available, and less difficult to find.

I think that there is still room for improvement, and I will continue in the quest of exploring a more effective Foundation for Execution.

*Enterprise Architecture as a strategy. Creating a Foundation for business execution by Jeanne W. Ross, Peter Weill, and David C. Robertson

Measurements of Optimal Supplier Performance

Supplier and vendor management is a key requirement to the health of construction projects; it impacts Project costs, schedules, and quality of the deliverables.
Tracking these processes is a big priority for Construction Companies and usually is included in Quality Control Procedures like ISO 9001: 2008 Quality Management Systems QMS . But sometimes even though the process is well documented, Contractors don't go the extra mile to make sure that these systems are properly implemented and followed.

 

Below are key factors that in my opinion are important for the proper implementation of a supplier evaluation system

 

• Who should do the evaluations
  
• Accurate Metrics
  
• The right technology
  
• The right audience
  

 

There are established metrics in the Industry to evaluate vendors and suppliers on different indicators like

• Cost
  
• Delivery
  
• Service
  
• Quality
  

 

Some of these metrics are

• On time delivery
  
• Quick response time in case of emergency, problem or special request
  
• Quality performance
  
• Quantity precision
  
• Service performance
  
• Cost of product
  
• Communication systems
  
• Flexibility to respond to unexpected demand changes
  
• Willingness to change their products and services to meet the firm's changing demand
  
• Use of advanced technology
  
• And many more
  

 

Senior management should understand what key indicators are vital to the success of their operations and invest in right technologies that will allow the dashboarding of these key indicators and create an adequate visibility so that key decision makers can have the most up to date information when selecting vendors and suppliers.

 

There are many vendors that have developed applications that address Supplier Management and integrate with existing ERP or other financial applications; also if you have developers on staff you can create your own custom applications.

The cost of wasted ideas

Collective Intelligence is one of the biggest assets that any Organization might have, and Companies due a very poor job harnessing it. Recently I was reading Simon Moore's book about Portfolio Management and the author argued that there is a cost associated with wasted ideas.

Companies do not have the mechanisms to gather all that information and ideas through the pipeline into the people in position to take them and put into practice, even though there are multiple technologies that will allow that interaction including all the Web 2.0 social media technologies.

But sometimes good technologies are just not enough. Often Management does not to take advantage of the resources available to them and fail to leverage them, most of the time because of egos and politics.

If you want to stay competitive, you must drive innovation…..

Communication should exist both ways up and down , Management should keep the Employees well informed as to what the business goals are and they are planning to get there, they have to make the employees part of the decision making and allow them to contribute to the pool of ideas that will contribute to innovation.