Seven Collaborative Solutions: SEVENth Heaven – Sean Culey
Sean Culey, CEO of Seven Collaborative Solutions (SEVEN), discusses the huge potential value that enterprise resource planning (ERP) can bring to a business, how to create strategic alignment and process integration, the value of SCOR® and how to unleash the untapped potential of an engaged workforce.
For many, an ERP implementation is little more than a software installation; for Sean Culey, it's an opportunity to make a good business great. He is a member of the Supply Chain Council's European Leadership Team, a global not-for-profit organisation mostly known for its SCOR model. Culey is making an impact through helping clients deliver value from their existing supply chain, people and technological investments - timely offerings in these days of austerity.
SEVEN identified a major gap in consultancy services - what Culey calls 'the strategic execution gap'. Management consultancies propose new strategies, directions or reorganisations, but typically do not execute these changes through to every level of the organisation. The reverse is true for functional consultancies - they focus almost solely on technical or operational improvements.
"We identified that this lack of alignment often delivered very poor return on investment for clients," Culey explains. "What was missing was a joined-up offering, a team who understood strategic and competitive drivers and could advise on how to optimise the cross-functional supply chain processes, improve organisational effectiveness down to a people, task and transactional level, and manage the process of change."
SEVEN's aim is to address the significant amount of investment being poured into ERP implementations that deliver limited financial and strategic returns. Answering why he established SEVEN, Culey reveals, "We wanted to minimise the time period between the initial outlay to the fruition of benefits from ERP implementations. We asked ourselves the question: 'How can we shorten the process and limit the pain?'"
Given that the predicted global investment in IT in 2011 will be $3.6 trillion and only 10-20% of IT investments are classified as meeting their objectives, then potentially 80% (or $2.88 trillion) could be unsuccessful investment; something Culey wants SEVEN to address.
The enemy within
Culey argues, however, that the benefits are large and are there for the taking for those that develop a healthy internal culture, strong leadership, clearer definition of goals and alignment of activities across the organisation. IT investment, specifically business-wide investments like ERP, needs to clearly identify exactly how it will enable the business to meet its strategic goals.
"Unfortunately, not many companies consider this," says Culey, "and rarely are ERP solutions linked to the delivery of strategic business goals.
"Good is very definitely the biggest enemy of great," he states, quoting Jim Collins' work on organisational greatness. "Leadership drives culture, and what I find too often is organisations don't really know what their strategies or goals are, or worse, what their company stands for. 'Growth' and 'profit' are outcomes, not strategic directions. IT projects need to be linked to strategy in order to deliver return on investment - and if the company doesn't know what these are, and how they should be measured, then knowing how technology or process improvements will help will always be unclear at best."
Culey highlights that organisations' 'measure and reward' structures often lead to functional thinking and behaviours. It is difficult to achieve an aligned strategy of service reliability if, functionally, sales are bonused on volume, production on utilisation and procurement on cost savings.
Changes at the top can also have an impact. "New executives, especially from outside the organisation, often try to make an immediate impact and may scrap existing initiatives set up by the previous administration, regardless of the stage of the project of the value to the business," says Culey. This can lead to a business lurching from one initiative to the next, resulting in 'project fatigue' - becoming initiative rich but results poor. When asked about technical innovation, Culey states that: "Innovation is often considered to be a technical issue but we like to help companies become innovative in 'thought'. Innovation comes from leadership, challenging paradigms, confronting brutal facts and changing the culture of an organisation to move in a direction aligned with clearly defined goals and values."
No silver bullets
The first 18 months after an ERP implementation are a sensitive time for businesses. Many fall back into thinking that the go-live was the end, not the start of the journey, and go back to old ways of operating.
"Changing thought processes takes a long time and needs strong leadership," Culey explains. "In the absence of that leadership, people retain bad business behaviours and stick to their silos. Having an integrated tool on top of a functional business doesn't work.
"Technology should be used as a strategic accelerator to improve that which adds value; to make essential tasks more efficient. But it shouldn't be used to automate that which shouldn't be undertaken at all.
ERP and SCOR
SEVEN are key promoters of the Supply Chain Council and use the SCOR methodology to rapidly identify competitive drivers, key metrics to improve, best practices to focus on and to ensure that any documentation is of a global standard that the client can easily access and develop beyond their engagement with SEVEN. "It is critically important to us," says Culey, "that everything we do is in the client's best interests and leaves them with education, processes and documentation that can easily be enhanced as the business progresses."
SCOR is usually one of the first exercises SEVEN performs with its clients. "When asking, 'what really drives competitive advantage in your supply chains', we find that most companies have never been asked questions like this before," continues Culey, "but how it is measured, how processes are structured, and people empowered and educated to deliver that strategy are vital issues to consider."
Call to action
SEVEN helps organisations by creating what Culey calls 'greatness from the foundations upwards'. SEVEN has developed '7 keys to foundational and organisational greatness', designed to help organisations 'get control' of their supply chain processes and supporting systems, and educate and inspire their people.
Alignment and integration are two key words for Culey - alignment of processes, functions and activities to the strategic goals of the organisation, and integration across business processes throughout all levels of the organisation.
"Employees at every level in a company need clarity around what they need to do differently tomorrow to enable the company's new strategy, how they will be measured and what value that role can bring to the business."
SEVEN focuses on helping clients get alignment and control of their supply chains through effective development and alignment of seven different areas:
- strategic direction
- education and leadership
- process performance
- technology enablers
- data control and management
- aligned metrics
- continuous improvement culture.
To enhance its people, effectiveness and leadership capabilities SEVEN has recently become a channel partner of FranklinCovey (of The 7 Habits of Highly Effective People fame) and an accredited trainer of its materials.
Lean, sustainable and in control When asked about sustainability, Culey answered: "For me, sustainability is an output of an 'in control' supply chain. Control leads to lean, and lean to green." Supply chain volatility can cause organisations to lose control and become reactive rather than proactive. "Becoming demand-driven is a key mantra right now. I prefer 'Demand Aware' and 'Demand Control' - being 'aware' of demand patterns and deviations and 'in control' of how you respond. This requires access to accurate and timely cross-supply chain information - an area where ERP systems, done correctly, can add massive value."
Unleash potential, realise benefits
Empowering clients to succeed is at the heart of SEVEN's mission. Culey says: "I genuinely believe that most people always try to do the best they can for the organisation, but too often they can feel directionless and don't have line of sight between what they do and how it relates to the business's goals," he says. "Once you empower people with the knowledge of how their work makes a difference, and educate them on effective behaviours, use of systems and good processes, then there is no limit to what they can achieve."