Today, it’s common for people to work on projects together across multiple geographic locations and time zones. This is particularly true for client-facing services organizations, which often depend on a multitude of expert, outside contractors to complete projects in tandem with in-house staff members.
There are financial and accounting concerns, human resources, sales teams, resource and project management, change orders and client management variables all changing as the business operates. Exacerbating the complexities of managing a distributed organization are the myriad of systems that may not integrate with one another and departments that can’t easily share data with one another.
Succeeding in this new paradigm requires a tool that binds all of these moving parts together, allowing teams to work cohesively: an Operational System of Record (OSR).
Avoiding A Hairball Infrastructure
As varying needs across departments arise, it's easy to fall into the trap of a "hairball" infrastructure. This is a complicated mess of software tools that offer several different, potentially overlapping services. These tools might also have problems integrating.
A single central, authoritative data source that contains records of organizational data — whether sales, financial or project data — is necessary to untangle the hairball. A system of record that serves as a central hub connecting all other systems that are unlikely to otherwise be connected to one another can simplify complicated systems and data arrangements.
In a client-facing services organization that tracks billable work hours, this centralized store is where teams collaborate. It’s also where decision makers handle resource management, project management and accounting. By centralizing these functions into one system, a firm can much more readily gain business intelligence to help drive decisions about what matters most — their people and projects.
Industries from HR, health care and marketing to retail, airlines and the U.S. military are consolidating their technology vendors in an attempt to improve efficiency and streamline cross-functional communications. Research from Osterman Research found that “69% of those surveyed consider a centralized management console for as many systems as possible in their organization to be ‘desirable’ or ‘very desirable.’”
Furthermore, KPMG found that project portfolio managers believe “inefficiencies from manual and time-consuming processes and disconnected data and systems” and “Poor resource [utilization] (lack of visibility across the [organization's] resources or resource shortfalls)” lead to the loss of business value.
An effective OSR allows teams to view updates and changes in real time so they can react accordingly. While many of the core business processes are standard, some are not. So, the OSR should also have a level of customizability that caters to a business’ specific or unique needs.
Keys To Keeping Your OSR Modern
Constant investment and innovation by your OSR vendor are key, but another major way to ensure your OSR remains modern is to choose one that was built from the ground up with an API-first approach. You need an OSR that fits into the rest of your existing tech stack so your other systems can be integrated. Ensuring the solution has an open API — so data can flow in and out — is paramount.
Examples of OSR-type systems abound. In the manufacturing industry, supply chain management is often carried out by an operational system, such as Oracle’s SCM (supply chain management) Cloud. Salesforce, a partner of ours, is not only a functional operating system for a sales team, but it is often the entire operational system for SaaS companies whose business models revolve around sales and customer-facing efforts. For departments such as human relations, tools like Workday bring the multiple motions of hiring, onboarding, benefits management and human capital management together into one system. These systems provide organizations with centralized systems that streamline data movement and information sharing.
However, the only constant in the world of business applications and systems is change. Your OSR should also be flexible so that it can easily incorporate new systems and adapt to changing technology in the future. Even if you’ve eliminated your hairball tech stack and created a perfect world of systems, things will change.
When An OSR Might Not Work For You
Though OSRs offer a variety of benefits, they likely aren’t the right solution for smaller organizations. If information and resource sharing can be accomplished through instant messaging tools or email alone, then the investment in an OSR might outweigh the returns it provides. The less complex a business’ operations and set of tools are, the less helpful an OSR will be. Leaders must consider their company size, whether they need to standardize their operations, and how many different resources they use for business operations when considering whether or not to leverage an OSR.
How Your Organization Can Benefit From An OSR
Without an OSR, businesses can become siloed or fragmented — the major challenge of a hairball stack — which can lead to all sorts of pitfalls, including a lack of communication, disjointed decision making and, eventually, failing production.
An effective OSR could offer much better visibility. If everyone is using spreadsheets, there is no way to get a complete view or unified picture of an individual project, let alone across multiple projects at once. Real-time reporting, improved visibility, faster decision making — these are all the key benefits of an effective OSR.
In the end, an operational system of record enables client-based-services businesses to take a wide view of various systems and teams, making collaboration more transparent and effective. With this approach, businesses can view various reports and metrics in real time, allowing them to forecast a potential problem and react before it becomes a full-blown crisis. Furthermore, businesses that can make intelligent decisions quickly become more efficient, more productive and, ultimately, more profitable.
Learn More About an Operational System of Record
Operational Systems of Record are changing the way services organizations run their businesses. Learn more in our ebook, “Transforming the Services-Centric Tech Stack.”
This article was originally published by Forbes on May 31, 2019.