Closing the Loop #ensw
The Nest thermometer is by far my favorite gadget purchase of 2012. Its spendy at $250 but if you consider that a 1% +/- change in your heating/cooling setting can tilt your yearly bill by 5%, accuracy and smart meters are valuable. You’ll make up the cost in savings in due time.
Wi-fi connectivity means I can turn it on 10 min before I get home from the iPhone app, it learns my habits as time goes by, the sensors make sure it doesn’t heat or cool when no one is at home, and finally it quickly adjusts to energy saving mode which has now adjusted to a comfortable setting in the house. Oh and for the coolness factor – it sends me atta boy emails with a green gamified badge for good energy conservation last month. Its jargon compliant too!
What does all this boil down to? The Nest is an amazing device because it closes the loop on what I set really out to do which is (a) at a basic level, seek optimal temperature and (b) avoid unruly utility bills. Most traditional thermostats do (a) explicitly and leave it to us to worry about how to optimize for (b). They don’t close the loop. Nest does.
Enterprise software can learn a lot from this. Traditional process software also focuses on only part of the objective. Some examples:
1. Governance, Risk and Compliance Software helps you assess risk effectively. But risk management as an objective expects that you can contain, reduce or make a call on taking on, said risk. In built collaboration to rope in those who create the risk does that. That’s closing the loop.
2. CRM Software helps you manage customer records. But customer relationship management expects that you build and retain authentic relationships with customers. Collaborating with customers to solve problems, to build products they want to and coming through for them when they are in a bind is what its really all about. That’s closing the loop.
3. Learning Management Software gets you course work. But outside of regulatory / mandated training, the point is not to take a structured course, its to learn/get up to speed / become smarter, faster. That comes also from learning on the job, from your peers who can offer practical insight. Learning comes from structured and unstructured study. That’s closing the loop.
4. Supply Chain management software really isn’t about managing a supply chain, taken literally. Its part of the larger business objective of getting products out the door at a stated cost and quality threshold. To do so, you need to ensure that your suppliers work well with you and with each other to get to those stated objectives. That’s closing the loop.
5. Sales and Operations Planning Software is great for crunching numbers by functional groups across the demand and supply chain in your organization. But the point of the exercise is to have these teams collaborate to work through scenarios and come up with optimal estimates on demand and stocked shelves. That’s closing the loop.
I’ve got 20 other examples but you get my drift.
Social and collaborative technology has a significant role to play in closing the loop. Not by itself in a vacuum as we’ve seen time and time again with even the most well intentioned or designed social software, or even without the help of good process systems and analytics. But in almost all cases, to close the loop it depends on how well you can contextually bring social and process together in near real time, to complete business activity.
The Nest doesn’t let you collaborate (thank heavens). And collaboration or social business isn’t the solution to every work problem either. But both, in their own way, close the loop on mission critical processes in our personal and work lives, respectively.
As you’re looking to understand the value of business software to meet your business goals, make sure you demand that it closes the loop.
SVP, Enterprise Social and Collaborative Software, SAP