Adoption of IT solutions what does it mean ? When is it valuable ?
We probably agree that adoption entails that humans adopt a technology because it delivers a value to them. Value is relative: the value to the individual, the value to the company, the value to society etc… The apotheosis is reached when all different types of values are met.
How does adoption start and where does it lead ? Adoption starts with making an attractive solution and interface available to users and providing immediately consumable and valuable content, even if minimal. In a nutshell, just like an App. As people understand what the App can do for them, they discover over time and quite quickly what more it can do for them, what they want the App to do which it does not yet do and which other purposes it can fulfill that they had not thought about. The approach is the same for a company IT solution.
Let me illustrate this based on a Sourcing solution: The buyer starts using it because it holds prepopulated and configured templates and makes the most frequently used and applicable logics available to her. This limits the risk of errors, accelerates the sourcing process and is seamlessly interfaced with the outside world: suppliers. This is the initial adoption stage, whereby it is key to meet the minimum and core expectations which any buyer has towards any tool which claims to cater to her routine sourcing activities.
However, soon enough, the buyer will realise that she is still performing a lot of the activities that accompany a sourcing process outside of the solution and therefore, despite the solution providing some relief with regard to repetitive and routine activities, the scope of it’s as-is usage and coverage is limited and therefore can be detrimental to the buyer’s incentive to use the IT solution as the prime tool for sourcing. This means that despite the initial adoption, adoption is likely to stall from thereon: The value delivered is marginal when compared to expectations.
The value delivered to the company at this stage could still be higher because it satisfies the company’s objectives with regard to compliance, savings rate, recorded cycle times etc. The same could be said for the value to society, because large steps of the process are digitalized, automated, globalised and accelerated thus increasing the GDP and data regarding sustainability, CSR is captured and can be reported upon meaningfully.
However, unless action is taking to revamp adoption, the virtuous cycle is likely to be reversed. Hence, this is a good time, to reconvene with the buyer to assess, what is it that she does outside of the tool and how this can be accommodated more efficiently using the tool. At this stage, we are talking about adoption health: the adoption of sophisticated features/functionalities and customized set-up which deliver incremental and breakthrough value.
In the example, it could be buyers performing auctions or advanced pricing calculations using a combination of TCO or Bid Transformation (with extended pricing) to refine the award optimization decision making. This leads to higher monetary value but also higher buyer empowerment, recognition, satisfaction and growth in capability. This means that we have moved from a push adoption model to a pull adoption model, the only sustainable one: or better said, meeting market demand.
This means that while the initial adoption phase might have been IT driven, company mandated or influenced by industry peers, the subsequent adoption phase is endogenous to the user community.
Throughout the consulting work I did with a whole range of customers, I find that success comes from identifying what delivers value to the individual users, then to the company and then to society, in this order.
I find that often the potential conflict in value interest between the company’s interests e.g. transparency and compliance and the users desire to exercise their “libre arbitre” and to do business as usual because it’s value is proven and safe, can be solved in practical ways. Here below a few examples:
- Buying: while it might be of interest to the company to make items available through company negotiated terms/catalogs, it might be more beneficial in phase 1 of adoption to instead make catalog aggregators or marketplaces available. This gives the users choices, is not exceedingly prescriptive, has a wider offering while still offering the desired transparency and compliance. Prescription can be introduced less painfully in phase 2 for the most frequently ordered products/services and so on.
- Sourcing: while the company might be interested in a thorough 7 or 8 step procurement process, it might be worthwhile letting the buyers familiarise themselves with the solution for less sophisticated sourcing such as additional quantities, collaborative sourcing, quick quotes, simple auctions for non critical categories first in phase 1. These processes cover at least 4 of the 7/8 steps. It should be easier then to mandate the 7/8 step process for more sophisticated, high value, critical or global sourcing projects in phase 2.
I find also that some companies by mandating what they want to be able to report upon at corporate level indirectly but decisively dictate the processes that will allow them to do so. Examples of this are:
- If a company wants to report on sustainability, it needs to capture sustainability data, it needs to evaluate it, it needs to make it part of its decision making process at the lowest level. A supplier Ecovadis score will determine which price differential (savings) the company might forego for a higher Ecovadis rated supplier. This cannot be done efficiently, systemically or effectively outside of an IT solution
- If a company is interested in measuring supplier performance, this implies that it will need to record what value was offered by a supplier at sourcing stage and how that value was accounted for in the award decision, the value contracted as well as the value ordered and received. This means a higher bidding supplier might have offered an extended warranty, which was contracted but then the supplier’s machinery had X breakdowns during the warranty period which compares unfavourably to another supplier not having offered such a warranty but whose machines did not break down. This also means that the company sustained ancillary costs due to the breakdowns by supplier no1. Therefore, the buyer would have had to base his initial award decision on a TCO calculation.
To summarize, the message is start small and let the business take you were you want it to go by using a series of carefully crafted incentives and immediate perks to ensure the business, that is the users, come to the same conclusions as you.