In the more than two decades that I’ve been in the advisory business, I’ve been involved with and observed many large-scale, complex technology implementations. One of the most interesting cases was the massive, global Oracle Enterprise Resource Planning (ERP) implementation that NCH Corporation undertook. It’s interesting because they not only hit a home run but also hit the ball out of the park. How did they achieve that when many companies fail to achieve the full anticipated benefits from IT implementations? General Colin Powell said there are no secrets to success; it’s the result of preparation and hard work. There are several lessons about preparation that CIOs can learn from the NCH case.
The implementation was awash with complexity that could have weighed the IT group down.
- NCH is a conglomerate of companies; so CIO Trude Van Horn dealt with a collection of executives and several CEOs in autonomous, independent regions and divisions.
- The company is in 55 countries on five continents.
- The plan was to implement Oracle ERP in 36 countries (25 in Europe and 11 in Asia) finishing all in 36 months — by the end of 2015.
- Part of the complexity was that those two regions — Europe and Asia — weren’t planning to run the same version of Oracle.
- The goal was to standardize processes and documentation and access to information but still capture and preserve the uniqueness of the region-specific business rules.
- While they implemented Oracle ERP, they also had to implement Oracle’s Fusion middleware, a product data hub and other proprietary tools.
Like most large implementations, the project could have been a breeding ground for resistance.
- While rolling out Oracle ERP, they also needed to implement proprietary sales and customer-servicing tools, some on iPads and some on Microsoft Surface Pro tablets.
- They had to deploy thousands of devices and navigate the difficulty of remote application deployment and upgrade.
- Impacting this project were 4,000 salespeople worldwide, using a direct-selling model, with disparate opinions on the tools they wanted and running in parallel in other regions.
- Employees had new duties to learn and new software to deal with.
- The IT team lacked knowledge/skills for some of the new technologies.
As Van Horn said to me, “We not only moved everybody’s cheese, but we turned it into yogurt.” Complexities could have weighed down their chances for success and there could have been major resistance to all the change. But that’s not what happened in this case.
Many CIOs last only 18 months, even though they deal with challenges far less complex than those faced by Van Horn. So what made the difference? Leadership.
“Leadership is all about motivating people and empowering them and making them see their accomplishments rather than the mountain that’s in front of them,” said Van Horn. “To drive change and introduce new technologies in the midst of tight deadlines, massive process change and so many moving parts, you have to get the business to partner with you, and trust you, or they won’t adopt the change.” Let’s look next at how the CIO accomplished that objective.
Step 1: Get buy-in before moving forward
Business stakeholders. A song in the Mary Poppins movie highlights a highly effective strategy for driving change: “a spoonful of sugar helps the medicine go down.” The monolithic Oracle implementation became more palatable to the business users in the European and Asian countries once they realized the benefits they would enjoy as byproducts:
- Sales and servicing tools that they hadn’t had before
- Centralized, integrated data and new standards of reporting
- Speed and transparency
- Elimination of the risk from 20+ year-old legacy systems
IT team. Recalling the project, Van Horn emphasized the importance of team building. “We spent a lot of time on that because people were working 24×7 for months and months on this project. Everyone worked the equivalent of two full-time jobs in doing these rollouts. They were on the road in Europe or Asia every two weeks. There was a lot of personal hardship, a lot of personal dedication.”
She explained that a critical part of team building was making sure that everyone recognized the value and importance of the person as well as the job. The result: their work became a point of pride.
Safe culture. Another critical factor was the company culture. The environment’s key characteristics included:
- Employees were able to voice their opinion, and they knew every voice counted.
- Employees were motivated to put new things into practice, and it was a safe environment for learning new things.
As Van Horn pointed out, each of these characteristicsare “important when you have a team this large and a goal that seems impossible.”
Step 2: Approach
NCH had an unusual IT shop in that some of the team had been with the company for 10, 25 and even 35 years. Many of them had traveled the globe to implement the legacy systems, and they knew people in all of the countries quite well.
They took a divide-and-conquer approach. This was crucial in accommodating all the differences among countries regarding regulations, reporting and even the ways the company rewarded salespeople. Key leaders each owned a track: sales and mobility, order to cash, supply chain & logistics, data management, finance and technical Track. The tracks ran in parallel to drive the most speed. But it required tremendous, constant collaboration and communication.
They built a common Oracle foundation (the “medicine”) and then added customization layers on top (the “sugar”) to accommodate the uniqueness of each country, any unique processes and the region-specific sales and servicing tools.
Step 3: Mastering the learning curve
The IT team had deep Oracle talent in release 11i, but Europe chose to move to a newer release, Oracle’s R12, to drive back-office consolidation and cost efficiencies. The team didn’t have R12 expertise but was eager to learn. They had to maintain speed, upgrade quickly and didn’t have time for everyone to stop for training.
People learned on the job. The company’s IT’s learning culture acknowledges that mistakes will be made, and the culture does not tolerate blame. Everyone is encouraged to learn from mistakes, and find ways to make sure the mistakes don’t happen again.
They brought in consultants for a short time to help the team with the basics of R12 technology. “Our team learned from people who were experts in both Fusion middleware and R12, but just enough to light the spark in our employees. Then our folks grabbed it and ran with it,” said Van Horn. “Our team wanted to be able to learn quickly and dismiss those experts as soon as possible.” Remember, part of the groundwork was ensuring the IT team has pride in their work.
They also partnered with two third parties on sales and servicing tools. These partners provided a software foundation that NCH used to build customized technologies on top. Although they hired a third party to roll out the iPads and Surface Pros, that company didn’t have the right level of global experience or understand NCH’s culture; so the IT team took over that device roll-out project, too.
Van Horn stated that they made faster, better traction by driving IT expertise — helping the IT team learn and change quickly rather than dealing with the learning curve of external partners.
Paving the way forward
As I mentioned earlier, General Colin Powell said the secret to success is preparation. I believe that stakeholders’ buy-in is the most important factor in preparation. But Van Horn shared another key aspect of groundwork preparation: She made the effort to learn new leadership techniques for keeping the team motivated and moving forward through the grueling three-year project.
Her advice: “Build a culture that safely promotes learning, changing and growth without tolerance for blame. Leverage the skills of the team by empowering leaders to do what they are best at. Celebrate the wins and have a short memory for the mistakes. Nurture the feeling of team and pride and keep a healthy sense of humor.” And Van Horn quickly added, “Oh! And buy a lot of donuts and cookies along the way.”