Oil optimists significantly depended on luck when they drilled in an area not already known to have oil — an approach called wildcatting. Nine times out of 10, they drilled a well that was a dry hole. While the oil drilling process has advanced since then, software practice has not — when it comes to selecting software that has strategic potential.
Most organizations today believe technology can help execute strategy. Unfortunately, they often end up selecting software that can’t accomplish that purpose. That is, they select nonstrategic or wrong software. With the wrong software, they launch wrong projects. Result: implementation of dozens, or in large organizations, even hundreds, of wrong software systems.
Software wildcatting is selecting technology that may not have strategic potential to start with. It is merely a decision-making task, where the decision is not informed by a method to determine whether the proposed technology has strategic potential. There are many reasons that prompt us to select the wrong software. Here are four that appear to be the most common.
Reason 1: The technology is hot
We may think that what’s trending must be better. The problem with hot technology is that there could be hype and poor understanding about who it really helps. For example, it might appear good on the face of it, but your organization may not have the required culture and may be too large to change overnight.
Reason 2: The competition has that technology
We may be competition-obsessed. But what matters to your competition need not be what matters to your organization. Competition obsession could stifle purposeful innovation.
Reason 3: The technology solves reported problems
Suggestions for new software may come from employees, customers or suppliers. And that’s good. However, the software they suggest could be siloed. For example, a suggestion from a business unit may meet the functional goals of that unit, but fail to execute organization-level strategy.
Reason 4: The technology solves standard problems
Often, organizations make software investment decisions based on standard expectations from the functional category to which the software belongs or even merely based on standard benefits expected from “automation.”
Use a strategy-driven method
OK, it’s not always mere decision-making. For example, the organization might start with business process improvement that will also “identify an automation opportunity.” While this is a much better approach, traditional business process improvement methods appear to be oblivious of the power and pervasiveness of digital technologies. Another example: The organization might pick a software from a “Strategic IT Portfolio.” This approach sounds impressive, but picking from pre-prepared lists is unlikely to be helpful.
Regardless of the reason or the approach, the proposed software should be validated using a discovery method that considers factors such as the organization’s current strategic agenda.
“Organizations need to ensure that problems and opportunities that have not been properly diagnosed do not become projects — consuming time, money, and other resources — without reasonable confidence that they are valid means of achieving strategic objectives.”
— Andrew MacLennan, in Strategy Execution
Note that “discovery” here is really about finding a strategic combination of technology and business change. And the reason is this: Almost always, it is a set of business elements, including processes, people and technology, that together make a strategic contribution.
Oil companies no longer drill in our backyards hoping to strike oil. They first confirm the presence and location of oil before they start drilling — a fundamental lesson for decision-makers who want to ensure strategic potential before their tech projects go too far.