Recently I read a book about "Risk savvy decision
making" by Greg Gigerenzer. The author talks about risk taking within
organizations being driven by two types of cultures – "positive" and
"negative" error cultures, with the negative error culture being less
prone to risk taking. Relating this to the enterprise software world, most IT
organizations that deal with enterprise software such as SAP, in my experience,
tend to be highly risk averse and have a strong negative error culture. This negative error culture manifests itself
in many ways within Enterprise IT organizations: They spend an enormous amount
of time (in most cases, years) trying to implement and upgrade software. They have long bureaucratic processes with
multiple layers of approvals for implementing any change. They think
defensively when selecting service providers and software solutions, preferring
unproven solutions from large vendors to best of breed solutions from smaller
specialist vendors. All this to play it completely safe.
Understandably, IT provides solutions that cover critical business processes that affect the day to day processes of a company. And, there are publicized horror stories of implementations gone wrong and companies being stuck, unable to close books or ship product to customers. But as with all areas of risk, one needs to consider this "error" data in the larger context. How many failed projects exist compared to the total number of implementations? The answer is a minuscule number. Should this fear drive the defensive decision making on service provider or software selection? Should this fear of failure deter the risk taking that is required to develop creative solutions for today's rapidly changing business environment?
The larger the company, the stronger the negative error culture in enterprise IT. Risk taking is not recognized or encouraged. This explains why most business users now have a view of IT as a necessary evil and not as a powerful enabler. This also explains why Enterprise IT lags far behind rapid advances in consumer oriented solutions.
Enterprise software and service providers need to help companies transition out of this "negative error" culture to promote more risk taking. In today’s business world, IT after all is the key to innovation.
Understandably, IT provides solutions that cover critical business processes that affect the day to day processes of a company. And, there are publicized horror stories of implementations gone wrong and companies being stuck, unable to close books or ship product to customers. But as with all areas of risk, one needs to consider this "error" data in the larger context. How many failed projects exist compared to the total number of implementations? The answer is a minuscule number. Should this fear drive the defensive decision making on service provider or software selection? Should this fear of failure deter the risk taking that is required to develop creative solutions for today's rapidly changing business environment?
The larger the company, the stronger the negative error culture in enterprise IT. Risk taking is not recognized or encouraged. This explains why most business users now have a view of IT as a necessary evil and not as a powerful enabler. This also explains why Enterprise IT lags far behind rapid advances in consumer oriented solutions.
Enterprise software and service providers need to help companies transition out of this "negative error" culture to promote more risk taking. In today’s business world, IT after all is the key to innovation.
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