Achieving Business Agility through Operational Efficiency—The Challenge
What is Business Agility?
In today’s highly competitive and fragmented business environment, successful businesses must be absolutely customer-focused and market-driven. Otherwise customers will simply choose to take their business elsewhere. Organizations have to be fully committed and pay considerable attention to what customers are asking for and actively demonstrate understanding and a willingness to change to meet customer needs.
Business agility is the ability of a business to adapt to a dynamic environment and provide solutions to ever-changing customer needs.
Why Business Agility?
Customers are more demanding and more selective than ever before. They look for vendor partners that truly differentiate their businesses as being flexible and responsive. Only agile businesses can really satisfy these needs. Organizations that lack business agility tend to be less successful with internal projects, whether through inefficient processes, a litany of forms and paperwork, or other bureaucratic issues – and will struggle in the effort to continually provide value to their customers. In short, customers are looking to work with partners that first demonstrate their own business agility.
Traditional, reactive companies -
• Are slow to deploy new functionality because of the risk of business disruption
• Are hesitant to change from legacy systems or outdated proprietary applications
• Have purchased resources or applications that are under-utilized or under-deployed
• Are at risk of losing business as a result of unpredictable market conditions
Truly agile businesses, however -
• Anticipate and plan for changing customer needs
• Have better access to information
• Employ processes that automate repeatable tasks
• Leverage technology so that operational tasks become highly efficient
• Maintain and improve customer service levels
• Continually review, evaluate, and improve processes in a quest for optimization
• Deliver more relevant solutions and higher value to customers
• Recognize superior financial results; increased productivity yields increased revenue with a more efficient cost structure
Reactive vs. Process-driven
So if business agility is so important, why is it so hard for companies to achieve? Simply put: because of the increasing rate of change in customer requirements. Satisfying customer and end-user needs is now more than ever an exercise in hitting a moving target.
Companies and business units often undertake new initiatives, implementing new projects and systems in an attempt to meet customer needs. All too often this effort is an attempt to repair some urgent problem with the business. The approach of short-term fixes, or jumping on the latest business or technology trend may deliver some results, but short-term fixes are rarely a good use of resources, and generally do not address a company’s real issues.
It is a challenge that must be addressed head-on. Organizations must examine baseline operational processes that support the business, and then plan, implement, and support the right procedures. Being process-driven means the operations that support business activities become highly efficient. Only with well thought-out business processes in place from the ground up can an organization achieve business agility. In the way companies maintain supplier relationships, keep track of customer data, handle procurement, or manage accounting – the right processes will lead to increasing efficiency of operations while supporting growth, yet be flexible to change.
What is Operational Efficiency?
Companies need to find the best way to do what they do. Agile businesses are determined in their efforts to ensure the best people create the best processes, which leverage the best and most relevant technology.
People and the relevant experience they bring are critical to this effort. The right people have designed similar processes before. They have skills to lead an implementation and the ingenuity to find the most effective solution to challenges they face.
Process is key to driving down costs for any activities that are repeatable. If faced with a new complex challenge, it’s important to draw upon actual experience, best practices, and industry standards to design and execute any process.
Technology crosses all industries, all business units, and all business functions. In any instance, selecting the right technology to enable your business processes is no trivial task. This selection should include input from those who have implemented the same technology for the same purposes before to anticipate and avoid complex potential future issues.
Operational Efficiency is - what occurs when the right combination of people, process, and technology come together to enhance the productivity and value of any business operation, while driving down the cost of routine operations to a desired level. The end result is that resources previously needed to manage operational tasks can be redirected to new, high value initiatives that bring additional capabilities to the organization.
Operational Efficiency of the IT Infrastructure
Technology can be either a great source of financial pain or a competitive advantage for businesses. Almost all business processes are created to take advantage of some application of technology. Applications of technology are supported, or should be supported by an IT infrastructure that connects a company’s end-users to each other and to information and applications they rely on everyday.
The IT infrastructure is where policies and processes are put into place to govern the way information is organized and shared. The reliability, security, manageability, and availability of a company’s IT systems are extremely dependent on the design, implementation, and maintenance of the IT infrastructure.
IT Operational Efficiency is - having an IT infrastructure and environment that is automated and optimized in such a way that ongoing IT operational costs are reduced to a target level. Additional resources can then be earmarked for innovating and building new capabilities through technology.
What Does an Operationally Efficient IT Organization Look Like?
Following periods of rapid growth or consolidation as a result of corporate mergers/acquisitions, high-performing IT organizations have found ways to simplify their complex environments, and ultimately turn IT into a competitive advantage for their business.
Effective companies incorporate the right experience, known best practices, and industry standards (such as the Information Technology Infrastructure Library - ITIL) in designing the IT infrastructure and in strategic IT projects. As a result of optimal design, the infrastructure requires less maintenance, and will experience fewer complications. Optimal design also leverages existing technology, so systems and applications are not under-deployed or under-utilized. Scalability is important in support increasing demands as a result of business growth, without compromising service levels.
Process and standardization are central elements in driving results around reducing total cost of ownership. Maintenance activities and processes required to operate the IT infrastructure become standardized. Many of these manual efforts become automated and are overseen by expert IT staff. Inefficient activities are pulled out of the process, and this translates to a significant reduction in operational costs.
The operationally efficient IT organization is not only more reliable in supporting routine business operations, but also more effective in creating and supporting new capabilities. Resources that were previously required to keep up with operations and maintenance are redirected to contribute to innovative initiatives that generate new capabilities. These capabilities contribute directly to improved business performance, improved customer service, and increased revenues. The IT organization and the business are more tightly aligned, and IT is recognized as a source of value.
Competitive Advantage from IT-Operational Efficiency
• Lower IT Operational Costs
• Security and Scalability
• Focus on core business
• Consistent, Reliable Reporting
• Increased Application/System Reliability
• IT and Business Process Alignment
• Fewer Unforeseen Complications
• Enhanced Service Levels
• IT Simplification/Automated Management
• Innovation/New Capabilities
What We Do
Ensynch brings extensive IT-operational efficiency knowledge and experience to your organization. We succeed by understanding the whole IT-Operational Efficiency lifecycle - From understanding how to support your basic IT needs, to complete design, implementation, and support of complex IT environments, Ensynch will ensure the right people, the right process, and the right technology combine to increase your organization’s business agility and bottom line results.
Request more information about how Ensynch can help you increase operational efficiency and achieve business agility.
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