Two starkly different experiences last week have me thinking about boring business processes.
My wife and I drove by a recently opened Carvana “vending machine” near us– their octagonal, 8-story glass and metal robot which delivers the car you just purchased on the web. I was telling her how they have re-imagined so many things about the used car market. No depressing giant car lots. No used car salespeople. A 7-day return policy. Website with multiple views of cars as their virtual sales location. Algorithms applied to wholesale car buying. All kinds of logistics – if you cannot pick up the car at one of their locations they subsidize a one way plane ticket or they arrange for the car to be transported to you. All kinds of paperwork around car defects, customer financing and other areas digitized. And then there is the distinctive pick up point.
Have bar codes evolved in the last 15-20 years? It was a rhetorical question a client asked a vendor presenting on next-gen shop floor ideas. Vendor after vendor had demoed good old fashioned rectangular bar code readers. You think they could have at least talked QR codes. Even better they could have shown digital calipers, ring scanners, augmented reality goggles and industrial robots.
What’s the difference between the two besides octagons and rectangles? One unconstrained their thinking. The latter was just trying to sell you what they have and have had for a long time. There is a time and place for both models. We are at a stage where we should be doing more of the former, unconstrained thinking.
We are living in remarkable times.
Clouds and in-memory technology have given us virtually unlimited storage and compute. Telecommunications and logistics have massively increased our addressable markets. You can apply cameras and all kinds of sensors to capture all kinds of data digitally. We can communicate with machines without our fingers. Consumers have better technologies at home than enterprise users have at work. Even common citizens can develop new applications with no or low code tools. Every morning on New Florence I have an example of such unconstrained thinking. The first entry was way back in March 2005.
Most clients we deal with today have a “modernization” itch. Their ERP systems are entering their third decade of service. For some their cloud solutions are in their third or fourth 5 year renewal cycle. They are getting old in the tooth. Their vendors have tried to modernize the systems through waves of social, mobile, analytical, sensory, automation iterations. Others have spend enormous efforts digesting tens of acquisitions they made. Few, however, have rethought processes at a cellular level.
Most vendors have tended to apply their technology efforts “in bulk” – move all their functionality to a common UX or common cloud architecture. That is more efficient for them, but misses the opportunity that each business process should be reimagined on its own.
Think of the accounts payable function. If you could start from scratch, you would ask for invoices to arrive and be ingested in digital format. Your MRO purchases and contractor timesheets would arrive through networks like Ariba and Provade. You would apply machine learning to detect fraudulent charges and prevent duplicate payments. You would capture employee travel and expenses via their mobile phones. You would be applying robotic process automation to routine AP tasks. You would pay your vendors with a myriad of procurement cards, mobile payment applications, electronic transfers, currency applications and yes, even old paper checks. And yes, you would be looking at potential Blockchain applications. Now try to find a single vendor which has rethought their accounts payable processes so thoroughly.
And that’s just one, well-trodden business process (interestingly one which Michael Hammer famously used to trigger a wave of process reengineering activities in the 90s). So much has changed in the last couple of decades when you look at industry and country specific practices. So much technology is available to re-imagine each of those.
My colleague Brian Sommer and I help clients with some of this re-imagination, and as a hobby we frequently discuss what-if scenarios around a wide variety of processes.
We are geeks who like to reshape rectangles into octagons. We want many more to try the new calculus. And push their vendors to try it even more. There has never been a better time.
(Cross-posted @ Deal Architect)