Harvard Business School’s Clayton Christensen and SAP’s co-founder and Chairman of the Supervisory Board Hasso Plattner were on the main stage at SAPPHIRE NOW 2014 on Wednesday, June 4 (replay of keynote), discussing the innovator’s dilemma in the context of the transformation of enterprise computing brought about by cloud computing, big data, and mobility.
Christensen argued that industry leaders run into trouble by doing ‘all the right’ things - working hard to be the best for their most important customers - when new technology allows rivals to enter the market with cheaper, better, and more disruptive alternatives. What they need to do, he said, is make sure they can compete with the disruptive innovation, which means shifting attention to the parts of the industry where the big disruptive innovations are happening and taking these shifts seriously.
That’s easier said than done; it’s called a dilemma for a reason, after all.
What I thought was interesting, though, was the difference between the situations where the innovator dilemma holds - like the software industry - and places where it might not - like the public sector. Public sector clients in government, education, and healthcare don’t have the luxury of focusing more attention on some customers - because that’s ‘where the growth is’ - at the expense of everyone else. They really have to be all things to all people, all the time. And, they have to do this while making sure they are working efficiently; public sector institutions need to work lean and they always have to mind the budget.
Maybe we can call this the public sector dilemma?
But is there really a dilemma? The more I think about it, the more I think there may be a different way to look at this.
Disruptive technology often hurts industry leaders in industries like software, Christensen said. It seems to me, though, that it’s just the opposite in the public sector! Here, new technologies like cloud computing, big data, analytics, and mobility can help customers do more while doing less. In other words, with these new, disruptive technologies, costs can come way down at the same time services are significantly improved.
In fact, we see examples of this all the time. Salford City Council, in the UK, is a great example. Budget constraints? Check. Increasing demands from citizens? Check. So, there has to be trouble, right? Here is the thing: since the Council started working with SAP Active Global Support (SAP AGS) delivered by SAP Enterprise Support, things are actually working more efficiently and costs are lower. Over the course of their SAP support engagement, SAP Enterprise Support helped Salford improve efficiencies, enabling greater staff availability for direct services to all Salford’s citizens while also helping them lower costs. See their full story [link].
“All our projects are connected by a golden thread to our key public service objectives. SAP Enterprise Support helps Salford City Council focus on running better for our citizens.” – Karen Smith, Principal ICT Consultant, Salford City Council.
Salford City Council's additional achievements
- 60% faster resolution to a critical system issue
- 100% cost savings due to in-house support
- 32,000 public benefit payments managed on time
And they’re not alone; their neighbors at the Surrey County Council saw the same kinds of results. Surrey County Council wanted to improve business process efficiency and optimize IT resources. With the help of SAP Enterprise Support services, Surrey County Council simplified and standardized their IT landscape and streamlined processes, which allowed them to allocate more resources for the people of Surrey. See their full story [link].
Surrey County Council's additional achievements
- 98% improvement in payroll processing, including $100,000 Eur. savings from better financial intelligence reporting
- 17% reduction in database size, saving 100GB of space
- 60% fewer custom transactions and reports
Perhaps innovative technologies aren’t always as disruptive as they seem - at least not in the public sector.
Resources - Links:
Salford City Council's success story
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