I've been reading a book, The Wealth and Poverty of Nations by David Landes. In the book, Landes lists some of the important inventions of the Middle Ages that allowed European societies to gain eventual global pre-eminence. One of them mentioned, of course, is the printing press. We are all familiar with the story of how Gutenburg, after inventing movable print, was able to print hundreds of copies of the Bible which previously were only handwritten with great time and labor. The printing press allowed a great deal of information to be spread quickly across wide territory and, more importantly, across social classes. Another of the great inventions surprised me: the mechanical clock. In fact, the author says that the mechanical clock is a more important invention than the printing press.

The mechanical clock did two things:


1) It standardized time. The new clocks "set a time to wake, to go to work, to open the market, close the market, leave work, and a time to put out fires and go to sleep," according to Landes.

2)Like the printing press, it took information out of the hands of the powerful and the elite and provided it to everybody. Landes writes,"People could now coordinate comings and goings without dictation from above. The clock provided the punctuation marks for group activity, while enabling individuals to order their own work...so as to enhance productivity." So two of the most important of mankind's inventions are significant because of the increased information (and so, power) they give to individuals and groups lower in society's hierarchy.

Information technology has the same ability to move information down the hierarchy of organizations so that decision making and problem solving can be made more quickly. As more of you make changes to your information systems, keep in mind that your return on investment will be high so long as the new systems allow employees at all levels to solve problems and make decisions on their own. In other words, good information provided to the top of the organization is best used as a measure of whether existing strategy is on track and as input to further strategic planning. Information about routine processes and operations is most effectively provided to the middle and the bottom of the company's hierarchy.

Many legacy systems (previous systems) don't do much to help front line managers and their employees run the business. First, they tend to be structured so as to capture and transmit transactional information that is useful to the accountants rather than managers. Second, legacy systems don't provide the real-time information needed for effective decision making. Third, because little thought has generally been given to the sort of information that managers and employees need, legacy systems generally only provide reams of computer paper covered with numbers arrayed in rows and columns. Questions like, "What would the value be of doing real preventive maintenance rather than fixing things only when they break down?" can only be answered (if at all) by spending hours wading through boxes of old computer printouts and collecting information one datum at a time before even beginning to analyze them. No wonder most supervisors and their employees don't feel that computers have done much to make their work lives easier or more productive.

Implementing substantial changes to your information systems is a large and expensive undertaking. Right now, there seems to be as much evidence that you may be wasting your money as there is that your ability to improve service to customers while controlling costs will improve. Horror stories of huge budget overruns coupled with unrealized gains abound. Such projects require a fairly large leap of faith on the part of senior management. Failure can mean putting the organization under a great burden for years to come while success may only keep you up to speed with the rest of the industry.

How can you make such an undertaking a little less scary? First, remember the benefits of the mechanical clock and the printing press (i.e. putting information in the hands of those that do the work). If your objective in making changes to your information systems is to make it easier for senior management to oversee and control operations (as distinct from assessing effectiveness of company strategy), you probably won't get all you are hoping for from your new system. Get your employees involved in helping you design and implement the new system. Have them, first, map important processes as they exist right now. Then have them think through how having accurate, real time information available to them at the touch of a button could help them administer those processes in a way that increased consistency while cutting delays. Don't underestimate the time and money you will need to spend in training employees at all levels how to use the new system. This means training, not just to input data and produce the right reports. It means training in how to find and analyze information that will help them change how they do their work for the better.

I have read that the billions of dollars that have been spent by companies on changes to their information systems over the past decade have resulted in NO productivity improvement. That's zero percent return on investment. I think this is starting to change because companies are just now beginning to see that information made available for quicker and better problem solving by those who do the work provides the most leverage to the company.