Wanted: Strong Support Players

May 1, 2002
Keeping to your company's core competency is the key to business success.
Wanted: Strong Support Players

Knowledge is power, and therefore profit. Spinning gold out of knowledge, though, may de- pend on the more mundane process of gleaning insight and making process improvements based on analyzed data rather than on your IT department’s selling of information or information services.

That idea might not sparkle as much for executives as the popular for-profit knowledge model. In fact, more and more investment has been spent on for-profit IT. So much investment that the infrastructures of some IT departments have become exceedingly complex, not to mention costly. For some companies, the whole system has become a mess. And this mess has left many material handlers struggling on their own to solve integration and system issues.

Somewhere in all of this activity, executives and managers lost focus. When it comes to information technology, just like any other business tool, managers must ask at least one key question: How will this tool help me with my core competency?

Answering this question seems to be a problem for many executives. They’ve been chasing after the money for so long that more than a few may have forgotten what their company’s core competency is, leading to complex, expensive and, perhaps, useless systems. What’s more important, your customers may have forgotten what your core competency is. That’s when you’re in trouble. And that’s where IT can make an even bigger contribution to logistics operations.

IT can help managers and executives re-focus on the company’s core competency. As noted by Dr. Ed Frazelle, director of the Logistics Institute at Georgia Tech, one of the crucial features of a customer service policy is being able to segment customers according to a company’s available resources.

“Customer segmentation is the starting point in the process of logistics resource allocation,” said Dr. Frazelle.

And members of the IT department, with their knowledge of information programs, systems and software, can offer terrific advice on which of these products will help management segment the customer base most efficiently and most profitably. More importantly, they can offer support, one of the original functions — or core competency — of this department in implementing those products.

But they can’t offer that support if they’re scattered in order to accomplish other, non-core tasks.

It’s easy to become enamored of technology, but it’s imperative to keep focused when employing it. Technology is supposed to simplify a process or task. It’s supposed to make it easier to accomplish a function, or at least give you more data.

For IT departments, that used to mean their ability to offer support. This little-valued function is still crucial and greatly needed in material handling as well as other areas within a company. Viewing this department in such black-and-white terms of cost versus revenue short-changes everyone.

Not every type of information technology is suited to your core business. But many technologies can contribute to the success of your core business, assuming managers can keep straight which is core and which is support.

It all goes back to basics, and basic questions. What is it that you’re trying to do? Will a software package or information technology help you do that task better or more efficiently? Will it help you develop better relationships with customers and supply-chain suppliers? If the information technology infrastructure has become a second core business, maybe it is time to simplify IT.

Leslie Langnau, senior technical editor, [email protected]

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