Every company, now, is a technology company. Or, at least, they’re trying to be. According to Tech Pro Research, 70% of companies have or are working on a digital transformation strategy.
Yet the gulf between legacy corporates and the new crop of technology native companies — some of which are approaching ripe old ages themselves (Google is 20 years old, Amazon is 24, Facebook is 14) — remains huge. And this has less to do with strategy and capability than it does with culture and attitude.
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Build vs buy
Listen to Facebook’s then CIO Timothy Campos talk about building versus buying software in 2015: “We found that tweaking off-the-shelf software would force us to adapt our process to the tools. We want to do the opposite: Make our process better, more efficient, faster.”
Or Percolate CEO Noah Brier: “When it came to our roadmap, we never felt like we found something that worked for us, so we ended up building it.”
Does this sound like the attitude in your IT department?
Of course, both these companies use off-the-shelf software too, for certain things. Facebook use Salesforce for customer relationship management (although they did build their own CRM too), and Percolate use Asana for project management.
But it’s their lack of tolerance for software that doesn’t fit the company which sets them apart. They have recognised a truth missed by traditional IT departments mired in the build versus buy argument: that whether built from scratch or bought off-the-shelf, the software has to solve the problem you identified in the first place. The only way that happens is if your users, well, use it and, even more importantly, they keep on using it.
Research by G2 Crowd into enterprise collaboration tools noted that the failure of most enterprise software is, “that the user interface of collaboration software can make or break user adoption.” A Deloitte report looking at a broader set of enterprise tools concluded the same: “The user experience drives adoption, and user adoption is an important first step toward realizing business value from big investments in enterprise systems.”
That the user experience is crucial is probably not new news to you. How many times have you seen a requirements document that features “seamless UX” or “consumer grade experience” as a bullet point? A great user experience isn’t a feature you can tick off a list. It is the product of a deep understanding of your users’ needs, their context, their daily workflow, and your company culture. It comes from designing the software, behaviours and processes simultaneously. It comes from observing how people use the software and iterating quickly based on their feedback and real behaviour. There are so many things you cannot know about a solution until it is in the hands of users, that unless you are set up to run small experiments, learn and iterate, you run a huge risk of failure.
Still we see organisations implementing solutions with their promised ‘seamless UX’, bloated with features they don’t need but can’t turn off, and trying, again and again, to shape their organisation, their processes and their people around it. And why shouldn’t they? IT departments are asked to focus on delivering on time and on budget and are rarely tasked with adoption KPIs. There are legacy systems and software stacks in place, relationships with vendors are dug in deep and the talent necessary to build and evolve products may not exist internally.
But we believe that building software in cycles of make, test and learn is the only way you will be in a position to create a compelling user experience, to drive adoption and continued usage. With limited customisation options and lengthy lead times for any configuration you can do, off-the-shelf software just does not enable this approach.
Make, test and learn approach
To provide an example, Nando's recently undertook a project to redesign its employee experience, which was designed using the aforementioned 'make, test, and learn' cycles. At the beginning of the project, research was performed that provided an understanding of the company’s culture and the pain points for their employees. This enabled a launch plan to be developed that fitted around the teams themselves, and gave them the support they needed to feel comfortable with the new tool. Two years following its first release, the app is used by 77% of the workforce every week, and has been used by 87% of all employees.
The ‘make, test and learn’ approach matters most for those companies undertaking a digital transformation, something which means much more than just upgrading your company’s resources to take advantage of digital tools and channels or shifting to SaaS. If you’re not changing mindsets, behaviours and culture, you are not truly transforming your organisation. Research from MIT Sloane and Cap Gemini shows the benefits of this wider focus:
[M]ore digitally mature companies were able to combine a focus on change through new technology, with a concurrent focus on change management, people, process and culture. The study found that this latter group of companies were, on average, 26 per cent more profitable, had a 12 per cent higher market capitalization, and derived 9 per cent more revenue from existing assets [than the average company].
The same research showed that companies which failed to support new technology with ‘the underlying strategies, processes, team structures and cultures to exploit it’ were 11% less profitable than the average company.
There will be times when buying software off the shelf makes sense (even we don’t build our own accounting tools), but next time you are faced with a list of requirements and a calendar full of vendor demos, take a moment to consider whether you’re pursuing an approach which will unlock the promised benefits to the business, or if your approach is chiefly for the benefit of the IT department.
Charlie Rowat, Senior Strategist at MadeByMany
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