A Matter of Governanc

A former senior executive in the federal public service, Chuck Belford started his own Nepean-based management consulting and management training company, Network Environment Associates, in 1994. Mr. Belford lives in Nepean, Ont.

Someone in a size six red business suit and four-inch heels has convinced a senior vice president that it’s time to champion a new, enterprise-wide technology – say a groupware product – that will kick-off what both hope will be a long-standing (business) relationship. Your escape and evasion skills let you down and you have been tasked with putting together the business case for the package. Worse luck, the fact that a senior VP wants a particular kind of technology doesn’t mean that the fix is in. You happen to work for one of those organizations where a business case really does play a central role in making a “buy/no buy” decision.

You know how to do the new math for the business case, but is that all there is? Not these days. In my experience, there is one factor that more than any other will determine whether and to what extent a new technology will fully realize its potential value. And this factor is never mentioned in the business case. What am I talking about? Let me begin with a fable that has absolutely no relevance to your organization.

Company X bought the dream of becoming a continuous learning organization and then it bought a 400 seat-license of a popular groupware package to make the dream come true. Three applications were developed for the company during the install. The company spent a fortune on training. All seemed rosy and bright.

It’s now five years later. Guess how many applications are running in the groupware environment: three. Guess how many people are actually using the product to its full potential: less than half the original number. Guess how many seat licenses the company is still paying for.

What happened?

Bad business case? Forgot to include net present value? Didn’t use a total cost of ownership approach? Not at all. The OEM and vendor were solid, the math was good and the company was committed to doing whatever it took to make it work.

What happened was that management dropped the ball. Oh sure, there was an executive champion when the buy was under consideration. Lots of buzz and bells and whistles. But then the music died and management ownership never took hold. The groupware package became a lost child and its value to the company started heading south six months after initial training was completed. What a shame.

What is the lesson here? Governance. Enterprise-wide technologies need continuous management patronage throughout the whole life cycle. Upgrade reviews, a commitment to training for new staff, new application development initiatives. Only senior management has the clout to make this happen. If your business case doesn’t identify the specific commitments senior management will have to make to ensure the ROI your numbers came up with, how accurate will your forecast be?