by Hamza Jahangir and Christian Anschuetz
Part of the Oracle Experiences in Enterprise Architecture article series
Christian Anschuetz is no stranger to enterprise transformation. He shared his experiences at the 2013 Oracle Leaders Circle as part of a panel discussion titled "Architecture Best Practices to Drive Innovation and Transformation." Anschuetz's conversation with Hamza Jahangir is excerpted here.
UL is the world leader in the business of safety science, ensuring that the products consumers buy are safe. 23 billion products get the UL safety mark each year, in support of 66,000 manufacturers. The world has changed radically since UL was founded in 1894. Global workforces, dynamic supply chains, and technological innovations complicate the business landscape, especially for manufacturers.
In response, UL is transforming its business model. Previously, UL worked with manufacturers at the end of their product development lifecycles, testing products to certify that they were safe. Today, UL offers direction throughout the lifecycle. Safety and sustainability problems are identified early to help these companies get their products to market quickly and efficiently.
As part of its transformation, UL is becoming an information-centric firm. The company is learning how to apply its vast knowledge and insight to its customers' processes so those customers can make safer and smarter decisions. This helps products get through development cycles with no delays. UL is also diversifying. What was once a single business is now five independent operating units. The company recently made 18 acquisitions in 18 months, buying the services it knows its customers need.
When Christian Anschuetz joined UL, all of its foundational principles had changed. It is now growing from a non-profit organization into a multi-national, for-profit company by standardizing its IT systems and business processes around Oracle hardware and software. Anschuetz helped guide UL through a modernization process that included not only new technology, but also new assumptions and aspirations.
Jahangir: What does business transformation mean to you?
Anschuetz: Even though I consider myself an optimist, when I think of business transformation, I think of failure. Analysts report that 50 to 70 percent of major enterprise transformations will fail, for any number of reasons. Many of those are massive failures that incur cost overruns up to 300 percent. As a result, we give our business leadership a good reason to fear changing aging applications and platforms.
We need to remove that fear. Transformation doesn't need to be difficult. Oracle Enterprise Architects utilize a framework for planning and change based on technology, process, and people. Technology changes all the time. And with the changes in technology we often get new processes. But we don't always address the people aspect. That is why enterprise transformations have huge failure rates.
Often, the hardest thing to change is ourselves. It is important to create a vision. We must give people a roadmap or a pathway to help them understand what change means to them, and then get their buy-in.
Jahangir: How do you put a vision in front of people that they can buy into, they can relate to, and they can execute and implement?
Anschuetz: It's not enough to communicate the transformation in terms of technology. You must create a vision that inspires people to be part of the change.
At one time UL was one of the nation's oldest and largest 501(c)(3). It was oriented almost entirely in the United States. All the work was done in singular super-labs. It was one company, pure and simple. Today, all of those foundational assumptions have changed. We are for profit, most of our work is done outside the U.S., and we locate labs near our customers.
All those structural changes served as the foundation for radical change. Our philosophy is, if we don't address the change in assumptions, we won't be able to deliver the services our customers need. We won't be able to help them make the world a better, more sustainable place.
We started a technological transformation around this vision of a company with new assumptions. We would come out at the end not as a professional services factory hybrid, but as a company positioned to become nothing less than an information powerhouse. And we inspired people to be a part of that information powerhouse. Success comes in how you communicate your vision, in how you immerse yourself into the culture, and in how you understand what motivates the workforce.
With those ideals as the backdrop, IT is responsible for modernizing our technology, led by an Enterprise Transformation Office. In 17 months we implemented a new Oracle-based platform serving 12,000 people in 54 markets and 104 countries-on scope, on budget, and on time.
Jahangir: How do you identify the people within your organization who can be leaders for change?
Anschuetz: There are a lot of criteria for finding great change agents, but the most important one is belief. Do they believe in what the organization needs to do? Do they believe that they can be part of that, and in fact drive it? And do they believe that the outcome is both achievable and something that is ultimately desirable for the whole organization? If you find belief, you find an incredible source of power.
Jahangir: How do you balance today's needs with tomorrow's growth?
Anschuetz: Don't concentrate on catching up to current technologies. Leap ahead. The key to doing that is architecture. If you have a sound integration architecture and a sound information architecture, you can innovate quickly and be amazingly productive at generating value for your customers. You must build a sound infrastructure and then start layering on old, new, and emerging components and systems. That way you can change not just your firm; you can change your industry.
There are a handful of things that you must do to be successful with these major transformations. It starts with a guiding coalition and tenets of how you will execute the transformation. One of the most important tenets is to configure rather than customize. Customizing the technology platform will hamper your agility. These are the things that will prepare you to leap ahead.
Jahangir: How do you reengineer a very complex set of business processes with so many stakeholders contributing their views and ideas?
Anschuetz: You should only do a transformation if there are customer outcomes associated with it. In that sense, it's not a technology transformation; it's a business transformation. You must have the right leadership driving accountability. The IT group is not responsible for reengineering the business processes. That should be done by the people who own the outcomes.
Jahangir: What is the structure of your Enterprise Architecture practice, relative to the business?
Anschuetz: We have five self-contained business units. And while we lead and govern Enterprise Architecture at the corporate level, it is formed and framed by those business units. Otherwise, we would be architecting solutions that don't deliver value. We start by determining what the customer needs and then we figure out the architectures we need to support that.
Jahangir: How do you facilitate business readiness for transformation programs?
Anschuetz: We actually didn't look at business readiness. We looked at office readiness to adopt the change. There was no business readiness. There was a fundamental business need. And whether you were ready for it or not, it was coming.
The number one thing that will kill your transformation project is doing too much all at once. Identify incremental milestones where you can illustrate victory. When we started the idea of this major transformation at UL, we expected it to take three or four years. Our CEO, a brilliant man, said, "You've got 18 months." If he hadn't drawn that line in the sand, we wouldn't be here talking about this victory.