IT projects "must deliver cold, hard cash"

A SSI product story

Edited by the Engineeringtalk editorial team Feb 11, 2002

Too many IT projects end up delivering only woolly soft benefits, such as better management information, more clarity, transparency etc.

Too many IT projects end up delivering only woolly soft benefits, such as better management information, more clarity, transparency etc.

And, according to Dale Barrington of supply chain solutions company SSI, in current market conditions, these soft benefits are not enough.

"IT must deliver returns in cold, hard cash", he says, "either through reduced costs, or improved customer service, and hence revenue".

Barrington identifies four key areas in which technical advances can help users run their businesses more effectively.

These he defines as collaboration; business intelligence; mobile computing; and integration with shopfloor systems.

He also stresses the need for an open architecture with enterprise application integration (EAI) capability.

"Business trends such as outsourcing and the focus on core competencies have led to disconnected supply chains", he explains.

"A typical manufactured product will pass through the hands of far more companies before it reaches the end customer than would have been the case a few years ago.

"There is huge potential for waste if partners don't communicate properly, with buffer stocks held at every link in the chain or inadequate planning leading to low plant utilisation as companies wait for information from their partners.

And vital information - that could help improve the situation for everyone - is often stuck in silos with partners blissfully unaware of its existence".

"Business intelligence (BI) tools are critical for delivering ROI, because they reduce the amount of time managers need to spend finding information on which to base their decisions", says Barrington.

"Good BI means better decisions, faster.

Mobile computing too is key; information entered onto a system at the point it is collected is less likely to be wrong than data collected on paper and inputted by a bored clerk in an office, and computing power than moves with the user can help deliver greatly improved customer service.

And integration with the shopfloor reduces both errors and costs, as data is passed automatically to the business system".

"Too many IT installations fail to deliver real bottom-line benefits", says Barrington.

"Generally, when this happens, it is because the user company isn't sufficiently clear about the objectives of a project, or because money is spent on functionality that isn't then used.

At SSI, we believe that achieving fast and verifiable return on investment is crucial - especially in difficult economic conditions such as exist at the moment.

So we are keen to encourage users to evaluate potential solutions rigorously.

"Fancy new technology can look great, but it won't necessarily pay its way", continues Barrington.

"It's vital that companies look for technological innovations that will genuinely help them cut costs, cut time to market, reduce inventory or increase customer service.

That's how IT projects can generate real ROI".

(This was Engineeringtalk's Top Story on 8 February 2002).