Did you know that user-centric organizations achieve 23% higher revenue per employee than those that are technology-centric? And did you know that productivity has dropped 17% the last years in enterprise software usage? If this doesn’t make you think twice about how you approach new IT investments, then someone – probably the owners of your organization – should be really worried.
According to the 4th annual IT Adoption Insight Report (http://sandhill NULL.com/article/2012-it-adoption-insight-survey-reveals-disturbing-level-of-enterprise-productivity-loss/) produced by Oracle UPK together with Neochange, the effective usage rates of enterprise software are down compared to two years ago, with users experiencing productivity losses of around 17%:
It’s like giving everyone Friday off. Many factors contribute to this problem but, simply put, end users are struggling to absorb the glut of IT investments made over the past several years.
Organizations do have a choice and can do things to avoid or change this situation. The study finds that the secret lies in being more user-centric as an organizations:
- Technology-focused organizations spend ~13% more on IT than their user-focused peers as a percentage of revenues.
- The user productivity loss of tech-focused organizations is 2.3 times greater than user-focused organizations. Tech-focused organizations are leaking almost a quarter of their users’ application usage time.
- User-focused organizations outperformed the tech-focused companies, achieving 23% higher revenue-per-employee against their industry peers.
Another report, also coming from Oracle but this time from the Oracle Application User Group (but sponsored by Oracle) has looked at the reasons for upgrading ERP systems. Dennis Howlett highlights in his ZDNet blog (http://www NULL.zdnet NULL.com/blog/howlett/73-oracle-customers-upgrade-to-stay-supported-no-reported-roi/3955) the following amazing (in a scary way) findings:
73% cited ‘end of support’ as a compelling reason to upgrade their ERP suite. 40% anticipate better functionality.
44% of respondents took more than 12 months to upgrade including a staggering 13% not knowing how long it took.
Howlett also notes that the study carefully avoids the real question that organizations should ask: what is the ROI from upgrading? He manages to put his finger on what is likely the real problem:
Customers are hoping and praying they don’t get left stranded so are forced into upgrade. The situation is so dire that many are throwing money at the problem without really thinking it through.
In the light of this, it should not be a hard to see why productivity in enterprise software use is dropping fast; the users and user productivity are simply not part of the equation, as other technology-centric issues (ensuring software support and increasing functionality) are considered to be of higher importance. .
What decision-makers in those organizations need to understand is that being user-centric is a mindset that is instrumental to building a high-performing organization. Until quite recently the main role of information technology in organizations has been to automate transformational and transactional processes in order to reduce the amount of expensive and sometimes inefficient human labor. But since then we have moved to a situation where about 40% of the workforce in the Western world is engaged in knowledge work and where knowledge work has become the epicenter of value-creation in the most successful organizations (read “Knowledge Workers and Knowledge Work (http://www NULL.theworkfoundation NULL.com/Assets/Docs/Knowledge%20Workers-March%202009 NULL.pdf)” by The Work Foundation).
The productivity of this growing and increasingly important knowledge worker workforce obviously requires a different approach when aiming to boost productivity using information technology than the traditional technology-centric and rationalization-focused approach. Instead of leaving the people out of the equation, information technology must be designed in a way that it extends people’s abilities and senses, allowing them to make the most out of their collective expertise, talent and engagement. We are seeing this happen on the commercial web, but it is yet to be seen in enterprise IT.
The findings highlighted from the studies above should be a horrifying read for someone who is even the least concerned about the productivity their organizations. If you think about it, the outlook isn’t that good either; if we continue in the same tracks as we have so far, for every IT investment that is made the situation for knowledge workers and their productivity will only get worse. This is the exact opposite to what most decision-makers believe will happen when they make decisions about new investments in enterprise software. Some seem to think that the next shiny and feature-rich system will be the silver bullet that solves all their problems. And no wonder why they do; there is a multi-billion global industry of IT vendors affirming their beliefs.
Let’s take an example from my own company to illustrate the problem and what you need to do about it to fix the situation.
In 2008, it was estimated that Tieto’s 16000+ strong workforce of IT professionals spent 30 minutes in average on time reporting every week. The time reporting task itself isn’t that complex, but the bad user interface in our enterprise time management system made it a time-consuming nightmare. What it meant was that a significant amount of our billable time wasted on something that was necessary but definitely not a value-adding activity. Not only that, it also caused a lot of frustration among the employees, something which was confirmed by the yearly user survey which found that 50% of all ICT complaints was related to time reporting. People also had a tendency to wait with the daunting task of time reporting, causing delayed invoices and thus lost revenue. For an employee it wasn’t the best way to end a week of work, so postponing it to after the weekend was seen as an appealing option.
In contrast to all other IT firms I have worked for in my career, Tieto’s top management actually decided to so something about it. Considering the business case, it should of course be a no-brainer for any top management team to make such a decision, but it seems that if there is no user-centric mindset in top management nothing will happen even if you have the most compelling business case: they just don’t get it. In their minds, a new user experience can’t really make such a difference. But boy are they mistaken.
So, it was decided that our skilled service designers and UX people should design and develop a new user interface to our time management system. After having introduced the new web-based user interface the business case was reaffirmed:
- The time spent on time reporting was reduced from 30 minutes to 5 minutes in average, reducing the number of hours spent on time reporting from 8000 to 1500 on a yearly basis
- This which translated to annual savings of over 2 million Euros.
- Time reports began to arrive in time, so that invoices could be sent on time
- The amount of complaints related to time reporting dropped dramatically
The most important result of this initiative is that the way this problem had been addressed and approached became a blueprint that has since been used for simplifying the execution of other administrative tasks.
Simplifying administrative tasks by user-centric design of user interfaces is the most effective way to eliminate or significantly reduce waste in a knowledge-intense organization. There are plenty of low-hanging productivity fruits waiting to be picked if you just put your user-centric eyeglasses on. You create win-win situations where the organization wins in terms of increased productivity and decreased costs and where the employee wins in terms of a more endurable work situation. The investment made is often small, especially compared to the benefits gained. For the time reporting application ROI was achieved after a couple of weeks. Put this in contrast to the enormous investments made in upgrading enterprise apps where ROI isn’t even assessed and which end up putting users in an even worse situation productivity-wise than they were before the upgrade.
The best thing with the time reporting application is that now it is coming to my smartphone as well. I will soon be able to choose to do the time reporting whenever and wherever I find the time, such as on the train from work when I suddenly remember that I forgot to do the time reporting before I shut down my computer and left the office. Hurray for that.