As digitalization permeates every area of the business, we’ve seen IT become far less siloed in its strategy, processes, and execution. The lines between the business and IT blur as technology becomes increasingly critical not only in how a company operates optimally, but in its value proposition for its customer base. With digitalization playing an ever-increasing role for businesses in every industry and geography, what needs to change as it relates to the IT approach to keep pace with innovation and remain competitive?
According to Pekka Nurmi, Director of Corporate IT at Cimcorp, it is critical to modernize your approach and focus on working smarter rather than harder. Cimcorp is a global supplier of intralogistics automation with systems used within manufacturing and distribution centers in over 40 countries across six continents. I recently sat down with Pekka to record a podcast that you should stay tuned for, but am sharing here the five major point of how he describes the company is working smarter versus harder to modernize its approach.
Tenet #1: Evolve Your Perception of IT’s Role in the Business
As I said, it’s imperative for the business and IT to be working alongside one another to accomplish today’s objectives. Many organizations have made strides in eliminating a siloed structure, but others have work to do in improving collaboration. “The business is much more involved and should be much more involved than it was a few years ago,” he says. “It’s not like the IT side has become any less important, but in order to get things done and the complete ideas, it’s like the scope of things has increased. Today, you have to solve the IT and business side at the same time.”
Particularly in service-oriented businesses, IT capabilities are crucial in delivering on the expectations of customers. Cimcorp is a user of IFS Cloud and, as Pekka mentions, believes strongly in the IFS mission to help companies master their moment of service. “We are using IFS Cloud, and they are talking about the moment of service and I fell in love with that slogan, ‘moment of service,’” explains Pekka. “Because that describes quite accurately what we need and what the customers need. The IT systems really have to be there, present, and have real-time information to provide in the moment of service. There’s no other way. When the customer contacts you, what the customer wants to hear is that okay, can-do answer. So, the moment of service is actually really fantastic way to describe the need of what IT has to delivery for the business.”
Tenet #2: Relinquish Control and Leverage External Expertise
A key mindset in Cimcorp’s mission to modernize IT and reduce complexity is to understand that the idea of doing, owning, and controlling everything is outdated. A modern IT approach acknowledges the expertise that lies outside of the organization and finds power in utilizing that expertise in order to reserve more skill for strategy than execution. “We’re trying always to find things to outsource, and there is so much new stuff IT has to take care of, like a compliance, information security, and embedding IT and IT processes,” says Pekka, “And that seems to be the core, so we really always are trying to find less critical tasks that we can outsource.”
For many organizations, Cimcorp included, this is a major shift and can take time to embrace – but in Pekka’s opinion, being a master of all is no longer a realistic goal. “Cimcorp has historically done everything in-house, but through a lot of discussion and opening the idea of how management sees IT department, we helped the company embrace this change,” Pekka explains. “It was based on an understanding that if we’re trying always to do everything, we will be so slow that with all there is to do, it just isn’t reasonable. Being able to prove that we’re on the right path by being able to do something in two weeks with a partner that would have taken six months internally helps foster acceptance. People are happy about it, and we get compliments from the management, ‘How did you guys do that in such a short timeline?’ and the cost wasn’t bad.”
Tenet #3: Embrace a Platform Approach
To simplify and master the complexity that is inevitable in today’s digital landscape, Cimcorp has fully embraced a platform approach with IFS Cloud. “We are always reducing the number of the systems in house, because we started from a situation where the number of different systems was just immense. And we were in the continuous loop of update, upgrade, and then you would begin to lag so much behind. We knew we needed to cut down the number of disparate systems and concentrate on the core systems in general,” explains Pekka.
When you look to consolidate into a platform, it is important to choose a partner that you feel is aligned with your short, mid, and long-term business objectives. “We’ve focused on finding suppliers and partners who share our vision of the future, because we cannot be inventing everything in-house. IT, for us, has become less about building and more about managing a network of partners who are on the same page with you,” Pekka says.
In evaluating options, the value of a platform approach was clear. “Of course, we do alternative scenarios. And when we discovered that we would have to build 19 interfaces between two systems, and most of them two-way interfaces, that was immediately the point that we knew we don’t want to do that. We don’t want to be spending the time working the interfaces, all the changes in the system that will affect the interfaces. So, once again, we found a position where we would be digging a hole underneath us with those interfaces,” explains Pekka. “There’s innovation in accepting IFS as a platform and limiting the number of systems. We did our homework, and we decided that IFS is a good platform for us.”
Tenet #4: Think Out of the Box
Perhaps one of the most impactful points of my discussion with Pekka is his description of the outdated view many have of software systems in the sense of overlooking the idea that a solution might work quite well for the business, right out of the box. We talked about the fact that this may stem from a historical viewpoint of far less sophisticated solutions, but that with what today’s technology providers offer, insisting you require customizations is – in many cases – an issue of pride versus reality. “ERP systems or software in general, they already have built-in processes, and tried out ways to work. And all the jobs I’ve had and all the customers I’ve had, I always saw that idea that everybody was trying to over-complicate that. ‘My process is so special. Our business is so special,’” says Pekka. “And as an outsider, you could say that I’ve seen this a thousand times. It’s the exact same process repeating itself time and time and time and again.”
What Pekka urges you to consider is to evaluate the out-of-the-box functionality before pressing for what you feel may be necessary customizations. “Have an open mind that maybe somebody has found the golden nugget of approaches that’s already built into the system,” he says. “They have tens of thousands of clients, and that have been running for decades actually. So, the process, it might have been already evolved. And in many cases, I’ve found that accepting the ERP system might actually be really smart. At least try it out, and if it’s not, then look to do something.”
Tenet #5: Focus on Continual Improvement
IT today is incredibly fast paced, and Pekka and I discussed that the primary role of the function has shifted from doer of all things to strategist and manager of all things. This means an increased focus on education, innovation, collaboration, and partnership. It also requires a constant state of movement. “I’ve been discussing with many of my colleagues in similar positions at similar companies, and we seem to agree that unless you’re a little bit proactive in replacing and updating and upgrading, you always are playing catch. And that’s not a good place to be,” Pekka says.
Pekka encourages his team to look externally for information and inspiration. “I continuously encourage my staff to find benchmarking companies and to be active in end user groups. We don’t want to be stuck inside the walls of our department, and it’s encouraged to discuss with the outside all the time, more and more, because we can only win in gaining that insight,” he says.