HPWorld 98 & ERP 98 Proceedings

Consumer Information Systems –Thriving in a Competitive Internal IT Environment

Eric Miner

Hewlett-Packard Boise LaserJet Information Systems

The operating environment for HP’s internal Information Systems groups has changed dramatically over the past five years. Differences in markets, organizations and expectations have forced IS groups to adapt to new, highly-competitive realities or wither and die – as many have. This paper chronicles the journey of HP’s Boise Laserjet Information Systems group’s from business practices that were successful in 1993 to those needed to grow and prosper in 1998 and beyond.

In this paper I’ll follow a more-or-less chronological flow of events as follows:

The Good Old Days – BLIS in the Spring of 1993

Triggers for Change – The Factors that Pushed Us into Transition

Voyage of Discovery – Finding Our New Place in the World

Putting Things in Place – Segments & Solutions

Results – What’s Come of All this Work

Finally, I’ll talk briefly about some of the lessons we’ve learned from this experience and about next steps, our ideas for the future.

The Good Old Days – BLIS in the Spring of 1993

Life in our Information Systems has always been challenging. But the challenges of today make us remember our group’s ‘old days’ with fondness. Our place in the world five years ago was defined by the following:

The world seemed a pretty safe place for HP IS groups in 1993. Oh, sure, there were a few clouds of change on the horizon, but they hadn’t really reached us yet.

Triggers for Change – Factors that Pushed Us into Transition

The pace of change really picked up during that next year. By the Spring of 1994 those things that had just been faraway clouds had bloomed into full-fledged issues for our group. Most we had seen coming, a few we hadn’t. All had some effect on us, but it was the cumulative impact that really shook us. Here are the high points:

It was fast becoming clear that we wouldn’t survive much longer as a group if we couldn’t define and clearly state the value we added to HP’s printer business. We felt that close IS support was important to our business but we couldn’t say why. We needed to understand our place in the world and to portray that understanding to our customers in compelling ways. And we had to position ourselves to deliver real, differentiated business value.

Voyage of Discovery – Finding Our New Place in the World

Something had to be done; the trick was finding the right place to start. We knew better than to just change things without a clear goal, but how to identify the right goal? Our management team decided to get help. They contacted an HP Corporate group that specialized in reviewing and engineering processes for other parts of the company. The Corporate folks were happy to oblige.

Three experienced reviewers conducted two days of discussions around our department’s focus, our business planning and other key processes, and participation by department members in those processes. Our reviewers were carefully picked to have a good understanding of Information Systems – its factors, traditional obstacles, major processes, etc.

We took several key points from the review:

Over the next several months there followed a series of educational events meant to build our understanding of the factors we must consider as we decided how to proceed. We learned more about how to focus our work more closely to our customers’ needs. (Creating Market-Focused Products – Everest Advisory Group) We learned how to communicate and utilize differing opinions to make better decisions. (Constructive Contention – The Bay Group) And we learned how to plan more effectively at strategic as well as tactical levels (Ten-Step Business Planning – a methodology developed internally by HP).

A key insight came at this time from Treacy & Wiersema’s book, The Discipline of Market Leaders. We saw that the Treacy model applied to internal businesses (which is how we now saw ourselves) as well as companies.

The very act of discussing how we fit into the model helped us enormously in understanding ourselves. What should be our primary discipline? We quickly ruled out Operational Excellence – high volume, low-cost service delivery was the territory of the large Information Technology Centers. For a time we considered Product Leadership. But we soon realized that we weren’t positioned or structured to provide individual products superior to those of outside companies with hordes of engineers dedicated to cranking out high-quality items.

That left Customer Intimacy. The light went on.

We found that we were in a wonderful position to build a successful Customer Intimacy ‘company’ right inside HP. We had the inside track on meeting all the requirements Treacy expounded for Customer Intimate organizations:

So it was clear we were in a great position to contribute to HP’s printer business success as a Customer Intimate supplier of information solutions. Now, according to Treacy, we had some crucial skills and behaviors to put in place.

We also brought the people of our organization together to help us understand how to implement Treacy’s ideas. The department divided into teams to discuss the shape of the organization, the skills needed, and other considerations. The teams’ recommendations were passed to the management team for integration into our overall plan.

Putting Things in Place – Segments & Solutions

Finally, in the Summer of 1996 all our work came together in the FY1997 BLIS Business Plan. This 58-page document was our value statement; it laid out who we were and what we planned to do for the next three years. It was built directly around the Ten Step Planning process, with a separate section for each step prescribed in the Ten Step methodology. In it our customers and, indeed, our own department people could find clearly enumerated all the key elements of how BLIS was going to add value to HP’s printer business. Some key points:

The 1997 Business Plan was a potent tool for us. Each member of the BLIS department got one. It was the centerpiece for discussions around directions and tactics that year. It served as the anchor for organizational changes within the department and as the basis for resource and financial planning. We distributed it to our customers and partners. It became the foundation for discussions about the number and kinds of solutions we would deliver for the year.

Of particular interest for this discussion was the Organizational Design. BLIS was still organized into groups for manageability, but these groups were dedicated to collections of related customer business needs called segments. (See the diagram below.) Our three segments were Product Generation, Demand Fulfillment, and Infrastructure Segments. Where before our people focused on a particular function-oriented computing area (i.e. Finance or Shipping applications), now they were given a group of customers whose needs might span several functional boundaries. Demand Fulfillment, for example, includes Finance, international Manufacturing, Shipping, Order Processing, and Inventory Tracking needs.

This new organization changed the focus for our BLIS people from functions & systems to customers & needs.

Getting closer to the customers and understanding their businesses and information needs is crucial to the Customer Intimate focus. We felt that this effort required more attention than the segment managers could devote so new Segment Lead positions were created. Segment Leads work closely with customers to quantify their information needs and relate those needs to possible Information Technology solutions. The Lead builds solution project proposals for the customer and BLIS management. Approved projects are turned over to Project Leads in BLIS. Project Leads form teams of engineers to deliver the needed solutions. The teams work closely with customers to define solutions rigorously, build them, put them in place, and train their users. The Segment Lead monitors the whole solution-delivery process to ensure customer satisfaction and to cultivate the ongoing relationship with that customer.

COIL-USD – The Whole-Product Experience

Long-term support for information solutions delivered by BLIS is done by our Current Product Support group. As a solution project nears completion the project team works with CPS to pass the solution for support. Obviously, CPS’s service critically affects the customer relationship, so CPS engineers work with the Segment Leads to keep the satisfaction level high. Of particular interest is the composition of CPS. Instead of having our customers outsource their computing support, we outsource it for them. In essence we replaced ourselves with contractors in this function. Our CPS people work with local software contracting companies to supply and manage support activities of sixteen contractors. This allows us to provide solution support for the best possible price. It also frees up scarce HP resources for solution development.

Our CPS group took a lesson in customer satisfaction from our LSG Marketing people. Seeing their efforts to make LaserJet customers’ experiences with their printers more satisfying, we tried to look at the complete, cradle-to-grave experience our customers were having with BLIS products.

We use the acronym COIL-USD to help us visualize the customer’s total experience with our products. This stands for:

In a Customer Intimate relationship, opportunities exist for the solution supplier in every one of these components of the customer’s experience.

We in CPS felt we had a sound grasp of Support. Now we needed to branch out into the other elements of COIL-USD. An engineer was dedicated to the oft-neglected task of disposing of solutions properly. This person makes the necessary arrangements for closing down applications properly, ensuring that all old links are deleted and ongoing information needs accommodated through other solutions.

Choose, Order, Install & Learn – Acting in Our New Roles

It’s nice to know who you are and that you’re good at what you do, but you won’t survive long if both current and potential customers don’t know, as well. This was brought home to us in spades when, during the Autumn of 1997, we found that some of our most important funding sources, general managers in new divisions, didn’t even know who we were.

So there it was. BLIS was just another vendor in a very competitive pond. We had all the challenges of any company struggling to differentiate themselves from their competition. And were our customers going to make any special effort to learn about us? Of course not – they were busy running businesses of their own.

We had to tell people about ourselves!

In the past we had always depended on our spot in the organization to bring us business. When people needed information systems they came to IS. Of late we had assumed that new business would just automatically come to us if we did a good job on the old. Well, it just ain’t so.

Getting the word out on how good your solutions are requires time, money and resources, just like any other marketing effort. You can’t just assume your customers are going to tell each other. In fact, you can’t just assume that the customer you helped last week will choose you for their next solution. You have to keep reminding them about how well you do things, educating them about all the good things you have to offer, keep your name in front of them so they know who to call.

We use all the standard tools one uses for any marketing effort:

One note here. We’ve found that we have to be subtler in our internal product marketing efforts than for outside products. Our internal customers are very sensitive about us spending their dollars promoting our own department. This means we’re not as vocal or as visual in our approach, and we use tools that are generally recognized as being less expensive. (Example: brochures and posters are generated with PCs, printers and plotters located within our department.)

Our partner in this endeavor is a small, local company that combines text editing and graphic arts services. In an interesting turn, they have established a long-term relationship with our group, worked to understand our needs, and supplied complete solutions at a premium price. In short, they’ve worked to be a Customer Intimate supplier of editing and graphics services for us.

On the Install/Learn side, we are working on mechanisms that will make it easier for customers to bring BLIS solutions into their own workplace. We are particularly interested in easy installation of BLIS products from our Web page. We want our customers to be able to choose, order, and install a product quickly and easily from the same page. We are also expanding our user learning efforts, upgrading the training and printed help that are part of the ‘total solution’ to a customer’s information need.

Once we had made the commitment to proactively learn about, order and receive our products and services, it quickly became evident that this work required more than just part-time commitment. The BLIS management team decided to dedicate a person full time to COIL. In fact, the role has now become large enough that we are expanding it to two people. One will specialize in Choose/Order and the other in Install/Learn, although both will participate in all four activities, as need dictates.

Results

While other Information Systems departments in HP have withered and died, BLIS has grown from 32 people serving two division in 1993 to 61 people (37 of whom are HP) serving the whole LaserJet Solutions Group today. Our relationships with our customers grow stronger with each solution delivered.

Examples of solutions we have supplied or are working on include:

(Note: The Intranet Distribute and Print segment is also addressing a second group of needs. Most of our initial efforts were around supplying solutions to large, strategic information needs. We found that there was considerable market for smaller solutions. The needs of these customers were shorter term, and thus didn’t lend themselves to the Customer Intimacy model. But the customers involved felt they had nowhere to go to get these needs met, and our management team came to consider these opportunities a good way to establish relationships that could later lead to larger, more long-term solution efforts.)

Lessons Learned

So we’ve gone through all this effort and seen success. What lessons can we share to help others searching for success in the competitive world in internal Information Systems?

Next Steps

As in any other business, there’re plenty of places for us to spend our efforts. Of course, we can’t let ourselves slip in producing high-quality information solutions for our customers – our bread-and-butter business. But we also must improve our Customer Intimate standing with our customers to continue to thrive. To that end we’ve chosen the following goals:

The Future’s So Bright . . .

We in BLIS are proud of the progress we’ve made over the past five years. It hasn’t been an easy journey by any means, but our role in HP’s printer business is once again clear, our customers are excited about the solutions we’re providing, and our opportunities as a department are greater than they have been in years.

Now it just remains for us to deliver on those opportunities.

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