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by: Bernard Teo

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Copyright © 2003-2012
Bernard Teo
Some Rights Reserved.

Wed 26 May 2004

Tools to Think With

Category : Commentary/toolstothinkwith.txt

There's been an explosion of interest in setting up economical no-frills backpackers' hostels here in Singapore, inspired by successful mom-and-pop operations like The Inn Crowd, which recently won a Singapore tourism award, and Hostel One-66, which is set up deep inside our public housing heartland, so travellers can get an authentic taste of living like a Singaporean.

The numbers show that the take-up rate, in terms of bed (or bunk) space, is very high, and this has prompted a number of real estate-owning companies (with lots of excess space due to the commercial property melt-down) to come into the fray.

I've been working on one such project, and I was commenting last week just how much I enjoyed the "Business @ the Speed of Stupid" book, and here I've found a use for some of the ideas in the book.

In projects like these, a lot of numbers are generated to support (or disprove) the viability of the business. And you also need to account for the considerable (and totally admirable) passion and grit that the mom-and-pop operations bring to the job. So how do you analyse how you're going to proceed?

I've found Burke and Morrison's "Executive Thought Framework" to be a very useful conceptualisation tool - big words but a very simple picture :

Basically, you look at things at two levels - the "competitive domain" and the "organisational domain".

The competitive domain consists of the customer and the competitors, and whether you have a vision whereby your presence will make a difference to the competitive landscape.

The organisational domain looks inwards into what you have and what you bring to the mix - your people, the systems you use, and the processes that binds people and systems into one well-oiled, smoothly functioning business machine.

I like the idea that you look at strategy as the balance between the competitive domain and the organisational domain. The greater the competitive pressures (e.g., how do you actually compete with people like The InnCrowd, who bring the Club Med experience to low-budget backpack living by sheer enthusiasm), the more you have to find answers in your own organisational domain (among the people, systems, and processes) to compensate for that.

This is an interesting problem. When you have a framework to think over things like that, you can see that this is really going to be a difficult exercise in finding a workable balance - especially when you have such focused competitors on the one hand, and, while the numbers show that there is a budget for people and some technology (in terms of PCs and credit card machines) and also for the accommodation items, there is nothing planned for systems and processes.

It brings me to the question of why information systems are so little valued. You wouldn't proceed to make changes to a building without engaging a professional architect, e.g., you wouldn't give the job to your friend's son who's studying architecture at the University of Singapore? But people would give the job of building a web site - the reservation system, the accounting and auditing system, etc - to just about anybody who knows a bit about PHP and web site authoring tools, no qualifications needed, just so they're cheap. Why is that?

I think there's a simple answer for that. People engage architects and engineers not because they like it and want to spend money on it, but because that's a regulatory requirement. If they don't comply, the penalties are enormous. So, once you have these requirements and you know you have to spend this money, the key is to find the best people for the money you have to spend anyway.

With IT, there is no such requirement. So people are not compelled to spend the money. I don't know whether it's good or bad to have a similar regulatory mechanism for designing, building and installing information systems (e.g., I'm sure that the use of Macs would be prohibited in the name of standardisation). But the fact remains that it isn't there.

So, IT developers have to find better ways of illustrating the relevance of information systems - where they fit in and why they're important. The better the tools we have to draw the picture, the better it will be for us, the developers. And also for the people who're running the businesses because I'm convinced they will lose their shirts if they go into the fight without a good system, though they don't seem to know it yet. So the problem is, how do we communicate that?

Posted at 7:50AM UTC | permalink

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