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Myths & Truths about Information Technology

Throughout my experience as company manager and consultant, I realized that many people have perceptions about Information Technologies that may not be complete or correct.  This is more so from people who have not experience IT projects and receive partial information about the subject.  The best way to appreciate IT is to experience it.  However, most of the managers may not have the opportunity to experience implementation of IT project during their career up to now.  Some of them might have done it wrongly, or participated in IT projects that were not properly conducted.  These form their perception about the subject, which is understandable.

Some of common “myths and truths” about IT that I encountered are highlighted as follows.

The Most Expensive Software is the Best Software

The price of the software generally reflects the amount of Research & Development (R&D), programming effort and the market demand for the software.  This often reflects in its comprehensiveness and therefore the complexity.  However, it is important to understand the objective of purchasing the software and consider its match to the organizational needs.  Not all organization requires complex and comprehensive software.  Paying for expensive software may become the same as buying a Rolls Royce for a salesman’s working car.

There were also managers who feel that all software are the same.  Therefore, they did not think that it was necessary to pay for software that was more expensive.  This often ended with software that needed to be changed a short while later as the company discovered that it could not perform many tasks that the business required.  More commonly, due to the high switching cost to change to another software, extensive modification were performed on the standard software that made it less stable and incurred more costs.

Implementing New Technology is Difficult

Generally, this is true.  Difficulty in implementing new technology is usually due to the lack of experience and knowledge.  As we are venturing into the uncharted region, the risk is often high.  Furthermore, there are also fewer trained personnel for the new technologies.  The stability of the application is generally less than a matured technology.  The cost of the new technologies is often much higher than matured technologies.  Not all organizations need to go into the newest technology.  The new technology should be evaluated against its benefits and risk.  Very often, it is better to adopt a proven technology rather than the latest technology.

Implementation of New Information Technology is the responsibility of IT Department

Having an IT department often gives an organization a sense of confidence in implementation of IT.  Although having an IT department gives company additional knowledge and confidence in computerization, it is important to recognize the limitation and strength of in-house IT personnel:

1. IT is very wide.  IT personnel tend to specialize in particular areas of the IT.  For example, some IT personnel may be more familiar with networking and some may be more familiar with Enterprise Resource Planning software application.  Therefore, they may not be familiar with the particular new IT implementation.  It is not uncommon to see senior IT consultants in IT industry who are ignorant about some of the Microsoft Office functionality although the software is commonly used.
2. IT changes rapidly.  It required time and source of updated information to keep an IT personnel up to date with the technology.  Very often, IT personnel who are out of the field for more than 2 to 3 years will become irrelevant rapidly.
3. Internal IT personnel have the benefit of understanding the business process of the organization.  They can be a good interpreter between the IT vendors and the management.
4. It is important to be aware that some of the IT projects involved in-depth business process understanding and changes.  IT personnel will not be in the position to provide leadership in these projects, as they do not have authority to decide on the change to business processes.  Implementation consultants often found that projects that have the IT personnel as the project leader tend to experience more difficulties than those lead by Senior Managers from the business and operations departments.  Most of the problems lay with human issues.

Implementation of IT is an IT Project

Implementation of IT is not an IT project but a business project.  All members of the company must have the senses of ownership of the project in order for it to be successful.  Implementation of IT often involved many people in the company and affect their working life.  It is important that sense of ownership is built up among the employees of the company.  Objectives and future benefits of the project must be explained to the employees.  Keeping it as confidential often creates more resistance to the project.

Top Management Support is Important

Implementation of IT projects involves changes.  Top management support is always important in projects that involved organizational changes.  In IT projects that often involve changes to business process and responsibility, conflicts will arise.  The project leader of the IT project must be able to resolve most of the conflicts.  Only with the top management’s support, that the project manager can successful complete the project and handle those conflicts.

You Need IT to Compete with Your Competitors

Nearly all companies need some IT to help them to handle routine work more efficiently.  However, blindly believe that IT is the solution to every organization problem is dangerous.  IT is just a tool to achieve the end.  Many a time, organization problem involves human problems.  Unless the human problem is resolved, implementation of IT will not achieve its full potential.  Moreover, many of the objectives can be achieved through cheaper means such as better human resource management, Total Quality Management and Business Process Re-engineering.

Computerization should be done when Current Business Activities Justify for it

Computerization should not be done when the current business activities justify for it.  Ideally, it should be carried out before the business activities pick up.  When the business activities are already at a high level, employees are struggling to cope with the routine work.  Adding IT implementation will often make the situation worst.  I had seen a company implementing a major IT project during the start of Asia currency crisis when the activity is lower.  2 years later, its annual revenue increased from S$16 million to S$56. It was also awarded the Singapore Enterprise 50 award.  IT implementation should be started in anticipation of higher activities.  Unfortunately, most of the companies I encountered look at the IT implementation only when they are already in the stage of fire fighting.

You need IT Staff to be able to Implement IT

Trained IT staff do comes in handy.  Unfortunately, it is not easy for Small and Medium Companies (SME/SMI) to attract and retain good IT staff.  That does not mean that SME/SMI will not be able to implement IT.  Most of the younger employees and managers now have some IT knowledge and experience.  There are also numerous seminars, exhibitions and training courses to acquire IT knowledge.  By identifying a suitable IT champion in the company and providing him with appropriate training, SME can still implement IT effectively.  There are also experienced consultants who can advise SME on IT implementation.  These consultations are often subsidized by government assistance schemes.

However, when company does not have trained IT staff, it is important to consider the complexity of the IT solution administration when evaluating IT applications.  The IT application selected should be simple enough for the existing staff to administer.

My experience working with various project managers in IT project also found that projects lead by IT staffs often involve more customization than those lead by operations staffs.  This often prolongs the project and increases the cost of the implementation.  This is no fault of the IT staff.  The more junior IT staff are often trained to look at the software and do not have strong knowledge of business process as compared to the operations staffs.  They do not have the decision authority to change a process as compare to the operations staffs.  Therefore, they often do what they are well verse in: customize the software.  A senior operations staff leading IT implementation often has better understanding of the critical issues of the business process and look at the possibility of improving the business process first before customizing the software.

IT can be used to Overcome Crisis

There are two types of problem that companies try to solve: Long-term and Short-term problems. IT projects often take a few months to a few years to implement.  The return on investment often takes 1 year to a few years.  Companies that are in crisis need short-term solutions that can create quick results.  Computerization is definitely not one of the solutions.  Computerization also needs some stability in the organization.  If the organization structure and people keep changing, it is very difficult to plan for training and implementation of the IT project.  I came across a company that was implementing a major IT project during a rapid expansion and tight financial situation.  The project had to be stopped due to changes of personnel, lack of focus and lack of financial resources.  The company later went into liquidity problem caused by some other business issues.

I want to use IT to Replace People

I had clients who told me that they want an IT system that replaces their people.  The system should automate everything so that his people cannot manipulate the system.

IT system is just a tool.  Like a fast racing car, it needs good driver and mechanics to keep it running and win trophies.  IT cannot replace people, at least not now.  However, IT means that people need to learn new skill, change their way of working.  Existing people need to be trained and new employees with different skill set and knowledge from the existing employees may need to be recruited.

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