Collaboration, partnering, networking and ecosystems are the buzz phrases of the 21st Century – a recognition that businesses need to be able to reach out beyond their natural boundaries to work with others. Rather bizarrely, in the networked economy, such co-operation can be collaborative at one moment in time, yet competitive an instant later. But collaboration also has an internal perspective which is just as vital to competitiveness and productivity. Gary Simon, FSN’s managing editor explores the benefits of a more harmonious way of working.
The dot com boom which ushered in the early part of this century was all about collaboration and broader interactions between businesses and consumers. Phrases such as B2B (Business to Business) and B2C (Business to Consumer) were the currency of the day but have long since faded from memory. The internet and more specifically the ‘extranet’ opened up the possibility of engaging with a wide range of stakeholders such as customers, suppliers and employees by giving them access to business applications over the web, such as, personal banking, auction sites, and purchasing a wide range of merchandise.
Arguably, these exciting developments which extended business processes beyond the physical boundaries of an organisation masked the more pressing need to create a collaborative working environment in-house. Both transaction systems, (ERP, accounting and supply chain) and information systems (business intelligence (BI) and enterprise performance management (EPM)) replicated the organisational structures of a business rather than the way people actually work.
Typically, employees are organised into functions, i.e. groupings of individuals into business units based on their principal skill set, such as credit control, sales invoicing and purchase ordering. But business processes and the way in which transaction costs are incurred do not respect functional boundaries. Transaction processes, such as “Quote to Cash” roam across the sales department, order department, inventory and credit control department – at the very least.
But reaching across these functional areas is generally far from easy. The modular design of accounting/financial and ERP software often acts as a brake on collaboration so that individuals are forced to hand on the ‘baton’ from one application area to another, losing contact as soon as their grip on a transaction is released.
The same is true of management information systems in which, for example, budgets are developed in departmental silos and inter-company financial results between subsidiaries are managed without any direct contact through the system. The result is that budgets in one area may conflict with another area and intercompany balances may be in disagreement for long periods before anyone picks up the discrepancy.
So what are the aims of collaborative technologies and what kind of solutions can make a real difference to the way that people work? The key objectives of collaboration are to remove organisational and geographic barriers so that structured and unstructured information can flow unimpeded and that authorised users have visibility of information and the supporting process. For example, a change to a chart of account line, an order line, or an updated account definition or submission deadline should be instantly broadcast to everyone involved in the process that needs to know. Similarly, difficulty implementing a new group instruction, a performance measure or perhaps a query over the interpretation of an accounting standard or group policy should be widely available to assist knowledge exchange and the propagation of best practice. Also, where relevant, it might be helpful to share management commentary or broadcast notification of a local difficulty with a system or software that that may have implications for other personnel in the same Group.
But collaboration is not merely confined to the communication of structured and unstructured information – important as this is. Collaboration also extends to the management of the process itself, such as the prior approval of a change to the chart of accounts, the digital signature on a compliance statement or the rejection of a management commentary and explanation of variances.
One of the biggest impediments to the smooth running of many business processes is that many tasks rely on a range of unrelated technical solutions. For example, a policy change may be communicated by an email or conference call, an approval of an account change may be made on a manual form, a problem with a variance may be buried in a Microsoft Word document, a new deadline may be noted in an Outlook calendar and a commentary on a performance measure confined to a PowerPoint presentation. Individual finance professionals may have to launch five different applications and trawl through several manual systems to keep their finger on the pulse. By contrast, combining the applications into a single cohesive environment means that individuals do not have to waste time searching for information, opening and closing different applications with different access rights and passwords. The ability to look across the process is not only time saving but provides a more fulfilling and enjoyable user experience.
There are many technologies that can contribute to a more collaborative environment and sometimes it is desirable to have a multi-pronged approach. In many cases the technology, such as Microsoft SharePoint, Infopath Forms and Portals are readily available ‘off the shelf’. On other occasions users are reliant on work flow embedded deep inside the application or perhaps specialized capability such as inter-company processing or account reconciliation. The ability to append commentary, documents or other files to transactions or performance management reports adds to the rich mixture of resources that can contribute to a more collaborative and effective working environment.
Efficiency and productivity is the prize for organisations that implement collaborative technologies. When employees across a business cycle such as an annual budget or ‘purchase to pay’ cycle can route information automatically for, say, approval by a supervisor there is an enormous efficiency gain as well as btter transfer of knowledge and enhanced control.
Collaboration may be a buzz phrase, covering a multitude of affordable technologies, but it has powerful implications. Organisations are finding that internal collaboration is just as important as connecting processes to customers, suppliers and employees.
