Chapter Thirteen Translating eBusiness Strategy into Action EBlueprint

Chapter Thirteen Translating e-Business Strategy into Action: E-Blueprint Formulation

Introduction E-Business blueprints the missing link between strategy and execution An e-Business blueprint is the whole fabric of applications, processes, and services that shape and sustain customer value e-Commerce Value Proposition e-Business Application Foundation What is the customer looking for? What applications are needed to facilitate value creation? Strategy Formulation e-Blueprint Planning © e-Business Strategies, Inc. -2 www. ebstrategy. com

Setting Stage for e-Blueprint Planning Today’s e-business efforts – Vague ideas substitute for cohesive management and welldeveloped plan – Intuition, not reason, directs development of new plans With rising tech spending, e-blueprint planning more important and difficult – Tech investments not linked to definable e-strategy – Difficult to make tech-related decisions – Analysis and implementation of tech projects meeting stated objectives rare – Confusion about tech due to high market activity Strategic alignment between business models and decisions on tech spending seen necessary © e-Business Strategies, Inc. -3 www. ebstrategy. com

Focusing on e-Blueprints, Not Single Projects Today, e-business projects being treated the same as any other initiative – Each e-effort undertaken as one project at a time – No forethought of achieving economies of scale and scope or shared resources – No shared strategic vision in place – Mergers and acquisitions compounding problems Causing serious app infrastructure problems E-business blueprint planning hurdles – Lack of political will – Departmental resistance giving precedence to individual projects over enterprise-wide need – Microsoft alternative to single-project mentality highly successful © e-Business Strategies, Inc. -4 www. ebstrategy. com

Focusing on e-Blueprints, Not Single Projects Why some companies grow. . . Where should we be next year? Goal Why some companies stagnate. . . And next year? You are year? here Work backwards You are here Time Incremental Approach Thinking Ahead Approach An incremental approach to application development will not work in the e. Business world. © e-Business Strategies, Inc. Where do we need to be 3 years from now? An e-Blueprint combines a clear understanding of where you need to be with what needs to be done. -5 www. ebstrategy. com

Beginning the e-Blueprint Journey Technology/Innovation Strategy Customer Drivers Technology Drivers Corporate Goals & Objectives e-Business Design e-Business Aggregate Blueprint Organizational Drivers Individual Application Framework Projects Business Drivers Customer/Market Strategy © e-Business Strategies, Inc. -6 www. ebstrategy. com

Beginning the E-Blueprint Journey Approaches for e-blueprint planning – Short-term • Patch together an e-blueprint plan incorporating the company’s existing apps – Long-term • Start over with an entirely new group of apps as the core piece of its e-blueprint plan © e-Business Strategies, Inc. -7 www. ebstrategy. com

To Patch or Not to Patch Three challenges when deciding to patch or not to patch existing infrastructure – Integration of existing infrastructure – Building seamless infrastructure on a fragmented app base • Front-end experience for customers must be a seamless, well-integrated service delivery platform – Knowing when to walk away and start over © e-Business Strategies, Inc. -8 www. ebstrategy. com

Evaluating Your Company’s e-Business Blueprint Process Red flags indicating e-blueprint process in trouble – Platform projects take too long – Many substandard projects in pipeline for years – All projects being implemented are long-term, multibillion dollar, big bang efforts – Almost all projects reinventing the wheel – Too much procrastination when making decisions – Project interdependence difficult to manage – Lack of communication and business side buy in © e-Business Strategies, Inc. -9 www. ebstrategy. com

Basics of e-Blueprint Planning e-Blueprint Creation Create a Prioritization Framework • How should you invest in framework integration? • What framework projects are high, medium and low priority? • What set of framework projects do we need to initiate? Key Objectives Feedback • Who develops the framework business case? e-Blueprint Facilitation • How can frameworks be aligned to achieve business goals? Make a Business Case • Can we make a compelling case to decision makers for Action about the need for change? Action Plan Feedback • What is our chosen path? e-Blueprint Execution • Are we following our plan? Tactical Implementation © e-Business Strategies, Inc. • How do we keep the plan relevant? -10 www. ebstrategy. com

E-Blueprint Creation: Defining the Blueprint in Your Company Five steps of e-blueprint creation 1. 2. 3. 4. 5. Establish aim of overall e-business design Establish scope of the effort Classify and analyze the app frameworks Prioritize what needs to be done For each app framework, design the execution plan © e-Business Strategies, Inc. -11 www. ebstrategy. com

E-Blueprint Creation: Defining the Blueprint in Your Company Step 1: Establish aim of overall e-business design © e-Business Strategies, Inc. -12 www. ebstrategy. com

E-Blueprint Creation: Defining the Blueprint in Your Company Step 2: Establish the scope of the effort – Map your ebusiness design into 3 types of improvement • Process improvement • Strategic improvement • Business transformation Strategic Improvement Business Transformation Focus of Change Build exceptional internal capabilities Gain unusual insight into the customer and market needs Skill Development Distinctive process thinking Excellent strategic decision making Implementation Approach Highly linear Entrepreneurial Measuring Progress Efficiency targets Market share © e-Business Strategies, Inc. -13 www. ebstrategy. com

E-Blueprint Creation: Defining the Blueprint in Your Company Step 3: Classify and analyze the app frameworks © e-Business Strategies, Inc. -14 www. ebstrategy. com

E-Blueprint Creation: Defining the Blueprint in Your Company Example of App Framework Project: B 2 B portal • Web-based order capture tools • Credit • Availability • Price • Customer prioritization B 2 B Portal • Payment • Strategic Profitability analysis © e-Business Strategies, Inc. • Multi sourcing • Multi shipping • Distribution • Price management and invoicing • Returns and claims • Service & Warranty -15 www. ebstrategy. com

E-Blueprint Creation: Defining the Blueprint in Your Company Step 4: Prioritize what needs to get done Screen 1 Screen 2 Screen 3 phase 1 Define the Aggregate Blueprint - Highlevel Design © e-Business Strategies, Inc. phase 2 phase 3 Prioritize Specific Projects within Application Framework Define Each Application Framework Scope and Scale -16 phase 4 Small Wins Rapid Application Module Development and Deployment www. ebstrategy. com

E-Blueprint Creation: Defining the Blueprint in Your Company Step 5: For each app framework, design execution Required Capabilities Driving Forces Implications Fast and Responsive Changing customer expectations; accelerating value migration Shorter time-to-market cycles High execution productivity Scarce resources; wrong moves can destroy company Make better management decisions about resource allocation and project selection Flexible configurations Continuous innovation; changing customer needs Make architectural decisions that allow flexibility Innovation Demanding customers; intense competition Creativity combined with integrated solutions © e-Business Strategies, Inc. -17 www. ebstrategy. com

E-Blueprint Creation: Defining the Blueprint in Your Company Elements of an execution map Integration Tactical Plan Process Reengineering Map Infostructure Map People and Critical Skills Map Development Tactical Plan Application Framework Map Legacy Integration Map Application Integration Map Blueprint Customer Needs Profile Map E-Business Blueprint Execution Plan Technology Map Project & Application s Map © e-Business Strategies, Inc. Vision & Priorities Customer Map Experience Tactical Plan 0 Product Versioning Map Customer Blueprint Development Blueprint Adoption Management Map -18 www. ebstrategy. com

e-Blueprint Facilitation: Making a Business Case for Action Customer Pain Legacy Infrastructure Projects in Pipeline Evergreen Blueprint Business Case New Framework Investments Execution Target: Focused on Customer Needs and Change Competition © e-Business Strategies, Inc. -19 www. ebstrategy. com

e-Blueprint Facilitation: Making a Business Case for Action Who develops a business case? – Today, technology influences business design – Blueprint sponsors • CEO, President, COO or GM • CIO • CFO • Operating VPs • Board – Dangerous to let consulting partners or IT functions to “betthe-company” app infrastructure in isolation • Decisions should be participatory • LOB managers, marketing execs, and corporate leaders should join IT professionals in tech review and decisionmaking process © e-Business Strategies, Inc. -20 www. ebstrategy. com

e-Blueprint Facilitation: Making a Business Case for Action Key elements of an e-Business case u. Idea u. Customer selection u. Value proposition Where? (are we going) Why? How? (will we get there) (will we win) u. Differentiation u. Metrics When? u. Channel selection u Partner selection u Supplier selection (will we get there) u. Technology selection u. Scope selection u. Project Selection © e-Business Strategies, Inc. -21 www. ebstrategy. com

e-Blueprint Facilitation: Making a Business Case for Action Changing a firm’s business strategy tantamount to committing money and HR in face of business risk and uncertainty – Preliminary assessment of scope can mitigate concerns Elements of preliminary scope – – Organizational High-level app architecture High-level project plan Resource requirements Detailed feasibility analysis next – – Financial Organization and cultural Technical Suppliers, partners, customers © e-Business Strategies, Inc. -22 www. ebstrategy. com

e-Blueprint Facilitation: Making a Business Case for Action E-Business business case checklist – Setting business direction should be preceded by realistic look at the marketplace and at a company’s circumstances – After that, responsible mgrs must follow these guidelines • Develop a goal statement • Set measurable goals • Set objectives • Develop short- and long-term action plans • Gain approval © e-Business Strategies, Inc. -23 www. ebstrategy. com

The Serious Business of e-Blueprint Planning Aligning strategy with e-business execution a serious undertaking E-blueprint necessary – Builds creative work environment in which steady stream of high-potential ideas can emerge and be manifested through enterprise’s infrastructure and strategy Top mgmt should play strong role in the blueprintplanning process – Blueprint decisions among most important company decisions – Cuts across several product lines or divisional boundaries – Frequently requires resolution of cross-functional conflict © e-Business Strategies, Inc. -24 www. ebstrategy. com

Alignment in Today’s Environment 75% of e-commerce projects are bound to fail because of a lack of good business planning and unreal expectations of what new technologies can do for their business. [Gartner Group] Primary Cause of Misalignment 40% of IT purchasing decisions are made by Line of Business Managers (e. g. , heads of marketing). The CIO and IT staff are then responsible for implementing the technology to fulfill that department’s business goal. © e-Business Strategies, Inc. -25 www. ebstrategy. com

Communicate, Communicate • Create an elevator pitch • Create a cross-functional e-blueprint team • Take baby steps • Clearly communicate plans and benefits of the new e-blueprint • Document success and publish results © e-Business Strategies, Inc. -26 www. ebstrategy. com

The Problem of Leadership Lack of consistent sponsorship from top mgmt the single biggest impediment to e-business blueprint planning Bad planning due to overdelegation Some responsibilities cannot be delegated – Sitting on the blueprint committee – Approving strategic direction and corporate vision it supports – Setting project’s goals – Participating in deployment process – Personally reviewing performance against strategic goals © e-Business Strategies, Inc. -27 www. ebstrategy. com

Questions on Executive Commitment • Is senior-mgmt involved in e-business decisionmaking? • Is top mgmt selling value of integration to decision makers? • Has the company recognized that improving ebusiness investment mgmt is a long-term process and should be planned accordingly? • Has the company ensured that e-business investment decisions are strongly linked to strategic business objectives? • Has the company built a shared e-business vision through various mgmt levels? © e-Business Strategies, Inc. -28 www. ebstrategy. com

Why e-Business Initiatives Fail Design app blueprint on your own, in your own dept Don’t do homework or auditing of company problems Don’t bother learning from other companies If you assemble a task force, meet several times in private Don’t seek outside help and if you do, hire a brand-name guru who knows nothing about technology or blueprint management When mgrs have questions, get defensive, rail at these “cynics” and “negative thinkers” who don’t get it © e-Business Strategies, Inc. -29 www. ebstrategy. com

Why e-Business Initiatives Fail Don’t worry about communicating Blueprint doc is 3 binders thick, full of checklists and spreadsheets Don’t bother with process or project mgmt Don’t waste time taking baby steps to execute Don’t factor in periodic feedback as an opportunity for course correction Don’t factor in existing projects © e-Business Strategies, Inc. -30 www. ebstrategy. com

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