social business innovation & legacy systems
DESCRIPTION
A journey through the legacy systems that destroy value in our organisations - from email overload and endless meetings, to fear culture and wheel reinvention.TRANSCRIPT
LEGACY SYSTEMS DEFINED
A legacy system is an is an old process, tool or behaviour that continues to be adopted even though more efficient methods of performing a task are now available
Legacy systems are often irrelevant in their current context
Legacy systems are a key cause of value erosion and business failure - largely because they slow you down
NASA's Space Shuttle program still uses a large amount of 1970s-era technology. Replacement is cost-prohibitive because of the expensive requirement for flight certification; the legacy hardware currently being used has completed the expensive integration and certification requirement for flight, but any new equipment would have to go through that entire process – requiring extensive tests of the new components in their new configurations – before a single unit could be used in the Space Shuttle program. This would make any new system that started the certification process a de facto legacy system by the time of completion.
Additionally, because the entire Space Shuttle system, including ground and launch vehicle assets, was designed to work together as a closed system, and the specifications have not changed, all of the certified systems and components still serve well in the roles for which they were designed.
YOU ARE NOT NASANew technologies & new understanding of human behaviour present an opportunity to replace legacy systems more easily, cheaply & quickly than ever before
Your business is not a closed system, it is an open system - the more open you make it, the more agility & innovation
THE IMPACT OF LEGACY SYSTEMS
THEY MAKE YOU SLOW
THEY DESTROY PRODUCTIVITYmissed market opportunities
hampered innovation
falling behind the competition
distraction fro
m value-generating activities
people hate working in overly complex systems
talent is prevented from rising
your best people grow frustrated & leave
AT NO POINT IN HISTORY HAVE COMMUNICATIONS & CULTURE MOVED FASTER THAN TODAY
The accelerating pace of change in business, characterised by global competition, means connecting the right people with the right information to drive business decisions means the difference between success and failure
IT’S NOT THE BIG THAT EAT THE SMALL, IT’S THE FAST THAT EAT THE SLOW
Avg life expectancy of companies in the S&P has dropped from75 years (in 1937) to 15 years - collapsing under their own weight
Big business is suffering from long-running performance declines
Return on asset rates are declining, even as labour productivity rises
The 3/2 law of employee productivity states that trippling your number of employees causes productivity to drop by half
Companies are no longer places that exist to drive down costs by getting increasingly bigger. They’re places that support and organise talented individuals to get better faster by working with others
THE NEW WORLD ORDER DEMANDS SPEED & AGILITY
This is the age of the collaborative, knowledge-based, hyper-productive organisation – where teams are connected across departments and geographies
WITH NEW CAPABILITIES COME
GREAT EXPECTATIONS
EXTERNAL24-7 REAL TIMEPRODUCT RESEARCH & COMPARISON3RD PARTY RECOMMENDATIONMISTRUST
INTERNALAUTONOMYTRANSIENCE & SELF EMPLOYMENTBORDERLESSNESSLEADERSHIP vs MANAGEMENT
EVERYONE CAN SHAREWHAT THEY CARE ABOUT
POSITIVEREFERRALS & RECOMMENDATIONS
NEGATIVEBAD EXPERIENCES
SO YOU ACTUALLY NEED TO BE A BETTER COMPANY
WITH A BETTER OFFERING
THIS IS THE ESSENCE OF BRAND BUILDING IN THE 21st CENTURY
LOOKING BEYOND CAMPAIGNS
SOME BRANDS & AGENCIES ARE ONLY FOCUSING ON THE FAÇADE
WHILE THE INNOVATORS OVERTAKE BY FIXING WHAT LIES BENEATH
PEOPLE
TECHNOLOGYPROCESS
COSTS YOU ARE LIKELY TO BE INCURRING NEEDLESSLY DUE TO LEGACY SYSTEMS INCLUDE...
THE COST OF SEARCHING
A typical information worker now spends a quarter of their day searching for the right
information to complete a given task
10% of a company’s salary costs is frittered away as employees scramble to find adequate and accurate information to do their jobs
So
urce: B
utler G
rou
p
THE COST OF COMPLEXITY
On average, the 200 biggest companies are losing an estimated 10.2% of profit as a result of unnecessary complexity
Removing this complexity would save each firm $1.2 billion of lost profits on average -
or a total of $237 billion across all 200 firms
THE COST OF LEGACY SERVICE MODELS
Call deflection savings from P2P support communities are typically 15-30%= £millions cost savings + increased employee efficiency
Support communities increase conversions, average transaction value, reach, engagement and SEO - often becoming #1 traffic driver to your site
Product issues are typically reported 3-4 weeks faster through community vs traditional channels
Customer satisfaction results are typically 15–30% higher amongst those who participate in user communities
Some companies are eliminating phone and email support altogether
THE COST OF LEGACY DEVELOPMENT MODELSBRINGING THE WALLS DOWN AROUND YOUR DATA DRASTICALLYREDUCES DEVELOPMENT COSTS & ACCELERATES GROWTH
Amazon were already achieving $19bn sales through their API by 2008
60% of eBay listings go through their API, with $500m in mobile-based application revenue
THE COST OF EMAIL ADDICTION
Email costs organisations of 3000 people £15 million per annum – just over £5k per employee
For a larger organisation of 6000 people, the cost escalates to £64 million – well over £10k per employee
Problems include ambiguous and unclear messages, email ‘overload’, security and privacy issues and destructive interruptions
THE COST OF LEGACY BUSINESS MODELS
ADAPT & OUTPERFORMA better business model often beats a better idea or technology
Businesses compete through their business models - therefore the business model itself is a source of competitive advantage
A disruptively innovative business model can become your company’s key asset and USP
THE COST OF ENDLESS MEETINGS
Professionals attend on average 61.8 meetings per month; and over 50% of this time is wasted
Assuming each meeting is 1 hour long, this means professionals are wasting 31 hours per month
On an average salary is £40k, this equates to £7,400 wasted per employee each year
THE HIDDEN COST OF
FEAR
lack of accountability
inability to make decisions
failure to innovate
analysis paralysis
THE HIDDEN COST OF UNOPTIMISED COMMS
New knowledge in neuroscience and behavioural economics can enable us to influence decision-making – yet these learnings are rarely applied in organisations, leaving money on the table
For example a recent pilot study, applying behavioural economicsprinciples, claimed the NHS could save £250 million in missed
appointments simply by having patients write their ownappointment cards
THE HIDDEN COST OF WHEEL REINVENTION
repeated mistakes - failure to learn
strategy duplication
duplication of roles & effort
millions of hours wasted
loss of momentum & inability
to keep up
THE HIDDEN COST OF
PRESENTEEISMTIME SPENT PHYSICALLY PRESENT BUT NOT REALLY DOING YOUR JOB
increased absenteeism
low employee retention
failure to innovate
lack of creativity
I’m distributing this presentation under a Creative Commons license, so feel free to share and change it according to these terms:
http://creativecommons.org/licenses/by-sa/3.0/
Jane Young
• Technology entrepreneur and founder of boutique digital agency Kanbee, agile project collaboration tool Scramblr and enterprise tool for innovation acceleration Daander.
• Social business consultant to leading brands, helping them create and capture value from emerging trends in technology, society and the workplace.
• Writing on social business and the new world order at www.resonanceblog.com
• [email protected] @resonanceblog http://uk.linkedin.com/in/janesyoung