|I am passionate
about unlocking the full potential of ERP and other business
information systems and
since 1989 have been discovering how to do this. This article
is the latest in a series describing methods of achieving exceptional
business outcome value from business information systems including
to previous articles at end
article builds on the previous articles on "Business
Systems Failure -- HOW do you recognize it?", "How
do you recognize a HIGH VALUE Business Information System Solution?" and
RIGHT Information to the RIGHT Person at the RIGHT Time Enabling THRIVE
Decisions -- THE Fundamental Requirement". It also
builds on the entire range of articles published last year as listed at
the end of this article.
article examines in considerably more detail the components of
precision configuration that enable executives, managers and
supervisors to obtain answers to EVERY question that they can
reasonably ask of their systems immediately at the touch of a button,
including the capability to drill down to the detail electronically
of information classification that enable any business information
system to operate at its full potential, using methods that are
independent of technology and which can be applied TODAY no matter what
operational software systems you are using, whether big brand or
ancient legacy system, are presented.
benefits discussed will also DRAMATICALLY improve the value yield from
your investment in "Business Intelligence" software, data warehouses,
query and reporting tools, etc.
benefits are huge, if you apply ALL that is presented in this article
you WILL be able to answer every conceivable question about your
organization limited only by the extent to which you have systems in
place to take the measurements and your far-sightedness in defining the
classification lists. As a spin off you will have created a
lean and highly effective and efficient organization in which the
quality of decision making from the CEO down has been significantly
improved, leading to improved competitiveness, growth and profitability.
you frustrated by your inability to obtain answers to simple
performance questions about your organization at a touch of a button,
despite your substantial investment in business systems and back office
staff? This article will show you why this is happening and
headline HOW to fix it.
One of the persistent complaints that I hear from Business Executives
when I interview them as part of my "Pulse Measurement" investigations
into why business systems are NOT performing is "Dr Robertson, we have
spent a huge amount on this system and yet I cannot get answers to my
questions, even though I KNOW that the transactions have been
processed". An extension to this point is frequently "and I
am told that we need to spend a considerable further amount over
several years to rectify the problem".
If I could show you how to
enhance the configuration of your EXISTING business information systems
such that you could get answers to every reasonable question, including
the questions you have NOT yet thought to ask, immediately, would you
And, IF in the process I could show you how to turbocharge your systems
AND your business?
It turns out that in order to answer every question that you can
reasonably expect to be answered by your business systems, IMMEDIATELY,
including the questions you have NOT yet thought to ask, you do NOT
need new technology, you do NOT need a project running for years and
you do NOT need to spend a huge amount of money – there are measures
that you can take, starting today, that will immediately start to
improve the situation, probably assisted by some external facilitation.
In fact, it turns out that IF you fully apply everything that is
referred to in this article you will even be able to answer questions
that today you would NOT think of asking!
There is a progression of measures that you can take, starting with
some simple measures that you can quite literally implement within the
next few days through to some measures that will take longer and cost
In considering what follows it is important to stress that I am
approaching this subject from an engineering perspective in which data
precision and the capability to model complex real world situations is
at the very heart of the use of computers, and has been for many
decades. Accordingly the standards of precision and the
magnitude of value yield envisaged are both orders of magnitude greater
than traditional business systems practice -- including but NOT limited
to ERP and Business Intelligence as well as your industry specialist
The principles presented in this article, correctly applied, create
intelligent data at a level that enables Business Intelligence tools to
achieve their full potential. By this I mean that BI
solutions can be created that deliver business intelligence at a level
of sophistication and power that is beyond what most people can
envisage. The strategic decision support value of this
capability will deliver a level of competitiveness and strategic
operational effectiveness and efficiency that is far ahead of
organizations that do NOT apply these principles.
Caution – this is NOT a technology discussion
frequently find that “tech-centric” people say they understand what
follows, even though inspection of the systems they manage clearly
indicates that they do NOT!
In considering my approach, as set out below, it is vital to understand
that I am coming from a strategic management; thrive
economic; military command; robust engineering; precision data point
of departure. Consequently I am addressing things in a
RADICALLY different manner that is DIAMETRICALLY OPPOSED to
conventional TECH-CENTRIC thinking; such that many (most?) tech focused
people do NOT understand this.
If you are deeply of the belief that computer software and other
technology is THE ONLY source of competitive advantage in this age,
ask you to put aside that belief in order to engage with what
follows. Fundamentally ALL the leading authorities on
strategy agree – it is NOT technology that gives rise to competitive
advantage, it is the effective strategic APPLICATION of technology that
This article is about a new and better way of applying the already
extremely powerful software that is in general use and universally
available – be it ERP, Business Intelligence or an Industry Specialist
product. Please put aside your "tech" hat right now and don
your "strategic business" hat for the remainder of this article.
High value (thrive) decisions are THE critical
to popular belief, the MOST important requirement for business
information systems is NOT process, it is HIGH VALUE (thrive
-- as defined by Professor Malcolm McDonald ) business decisions –
decisions that result in the organization doing things differently and
better than its competitors on a consistent and sustained basis.
The value of ONE dramatically good (thrive)
decision can be measured in millions of pounds through increased
profitability and growth. Conversely the consequence of ONE
dramatically bad (die) decision can be measured equally dramatically in
the opposite direction (such as IBM's decision to downplay Personal
Computers in the 1980's). However, such "fluke" decisions are
few and far between, whereas a culture of modest, consistently
strategically good (thrive) decisions will ENSURE high profitability
My approach, as headlined in this article, IF followed fully and in
strict compliance with my methods, protocols, principles and practices,
WILL deliver sustainably higher operational and strategic efficiency
and effectiveness than other techniques. This will lead to
substantially increased and sustained profitability and growth that
will far outweigh the greater apparent up-front cost of making use of
years ago I was contracted by a client to specify and supply a
simple piece of software for analyzing insurance loss events.
There was a tight deadline and a tight budget. I facilitated
the specification of the software in two days, the developer built it
in ten days. My design of the software incorporated about 56
drop down validation lists covering every possible information element
to be captured. I spent ten days sitting with a Director of
the client organization developing the content for all these validation
lists in accordance with the principles set out in this article.
year after commissioning I received a phone call from the client, "James, this is amazing, we have
a fantastic range of management information, answers to every possible
question we can think of, and we captured the data with 4 clerks
instead of the 12 we budgeted for, and we captured 90% of the data
versus the 10% that we budgeted for!" – see the CRM
Risk Control case study on my website.
This was when I first learned that it was possible to deliver the
answers to every possible question AND to do this at lower cost and
with greater overall efficiency than traditional methods deliver.
This learning is a key foundation stone in what is shared in this
The steps in achieving a comparable result for your comprehensive
integrated business information system (ERP plus industry and business
specialist modules or systems) are discussed in the sections that
follow, commencing with measures that you can implement immediately:
1. Existing simple attribute fields
1.1 Problem Statement
us start with a very basic example of a simple example – "Credit
Note Reason" codes.
The following codes were all that existed in a system that I advised on
that was NOT delivering:
01 Incorrect Price
02 Damaged Goods
03 Incorrectly supplied
Those look acceptable do they not?
But what about "Discontinued"?
and "Order Duplication"?
It turns out that MOST of the questions that an executive or manager
might ask relating to Credit Note issues CANNOT be answered with the
In fact, to answer the question "how many credit notes did we issue for
Order Duplication?" or, more likely, "how many duplicate orders did we
dispatch in the last quarter?" it is necessary for a fairly senior
staff member with reasonable understanding of the business to have all
the credit note transactions extracted into a spreadsheet and then
undertake some detective work based on a comments field, IF it exists
and, quite possibly, go and interview some staff to see if they can
figure out which credit notes were issued because of Order
Duplication. This staff member might also determine the
number of duplicate orders by downloading the orders file into a
spreadsheet, sorting on order value and carefully inspecting each order
to identify duplicate orders and then checking for the existence of
Any way you look at it, answering the question "how many duplicate
orders did we have to credit in the last quarter " is going to take
some time and cost some money, at least in salary and often in
consulting fee with your resident system support consultant.
If you then ask the same question for the last year the exercise must
be repeated. Next quarter the manual exercise will have to be
repeated, AGAIN, and the next quarter and, so on. Such that
you will have a member of staff with a fancy spreadsheet, possibly some
support from an IT staff member or consultant and various other costs
and inconvenience in perpetuity!
AND, the chances are that in the event that you ask questions like
"which sales representative" or "which product class", or … the person
who extracted the data will likely NOT have thought to extract that
data and so, having presented you with the answer to your first
question they will then again disappear to work on their spreadsheet
for a few minutes, or hours or days in order to answer your new
question. It is highly unlikely that you will be able to
click with your mouse and drill down on your own to answer your
questions – NO matter how sophisticated your business information
system and NO matter what the software salesman promised you (the
software will almost certainly be able to do the drill down, but the
data will prevent the functionality from being of any use).
In fact, IF your Credit Note Reason codes look similar to the example
above, EVERY question that is not directly associated with "Incorrect
Price", "Damaged Goods" or "Incorrectly Supplied" will require that you
initiate the above manual course of action. AND this will
happen irrespective of whether you are running a 20 year old legacy
system or the latest and greatest all-singing-all-dancing, fully
integrated solution from SAP, Oracle, Infor, Sage, Microsoft …
Because the problem has NOTHING to do with technology!
The problem is with the code scheme and the content of the list -- it
is NOT a technology problem.
The problem relates to the ordering, organizing and classifying of
information – the logic associated with the capture of data WHILE the
knowledge of the transaction is available to the person processing the
IF the code scheme is:
01 Incorrect Price
02 Damaged Goods
03 Incorrectly supplied
Then ALL information that relates to ALL the other possible reasons for
issue of Credit Notes is LOST at the moment the clerk clicks "Accept"
and closes the Credit Note. It is lost so severely that it
can only at best be APPROXIMATELY recovered weeks, months or years
later by inference based analysis of transaction data and by
consultation with staff. The resulting data will NEVER be
accurate, reliable or accessible and, if two staff members separately
undertake the spreadsheet exercise described above they WILL deliver
Note also that since there are ALL sorts of OTHER reasons for granting
Credit Notes AND the list does NOT include "Other" the operator is
forced to allocate the Credit Note to whichever code SORT OF,
approximately, at best guess, item comes somewhere close to one of the
The result is that you will NEVER know how many items were misallocated
and any analysis that you DO undertake based on the above categories
will be approximate and unreliable. This too will require
manual effort in a spreadsheet to sort out the mispostings BEFORE you
have reliable statistics for Incorrect Price, Damaged Goods or
Incorrectly supplied. This too will require repeat effort
every time the period changes or different questions are asked.
ALARMING AND FRUSTRATING??!!
and the solution is SO simple! -- The problem can be PERMANENTLY
rectified in a matter of a few hours so that you can answer any related
question electronically in real time with a few mouse clicks going
1.2 The answer
are the Credit Note reason codes that I facilitated
development of for the above client. The list took about an
hour to develop together with the CEO using the process described
below. It was then tested with various other staff members
and was implemented very successfully – the organization can now answer
EVERY POSSIBLE QUESTION with regard to Credit Note Reasons.
Reason Code Description
C. ORDER CANCELLED
CC Order Cancelled Credit Control
CS Order Cancelled by Consumer
CT Order Cancelled by Customer
D. DAMAGED OR DEFECTIVE
DF Defective Product
DM Damaged Product
DP Damaged Packaging
DT Consumer Complaint
P. PRICE ERRORS OR DISCONTINUED
PI Incorrect Price
S. SUPPLY ISSUES
SD Order Duplication
SF Customer Non-Franchise Holder
SI Incorrectly Supplied
SL Late Delivery
SV Not in Customer Inventory Master
T. USED AS TESTER
TT Used as Tester
ZN Not Known
Notice that the only thing we have done is to replace the inexact
"sloppy" content of the Credit Note Reason drop down list with very
carefully designed and comprehensive content.
Note that the above list allows any user with access to even the most
basic query and reporting tool, and ALSO the most sophisticated
Business Intelligence software, to not only answer EVERY possible
question instantly with a few mouse clicks, it also enables them to
drill down in accordance with the two level hierarchy in the code
Note also that this content is EXACTLY the same no matter what software
you are using -- there is NO need to change your software and NO need
to spend large sums of money, at most you need perhaps an hour with an
experienced facilitator, less time if you tackle a number of lists with
the same facilitator in one session.
AND note that there is NO OTHER way to achieve "answers to every
question, including those YOU have NOT previously thought to ask, NOW!"
– if you do NOT capture the information when the clerk processes the
transaction that information is lost, effectively forever!
And there is NO technology in the world that will retrospectively go
back in time and engage with the physical world relating to the Credit
Note to back analyze the reasons that were NOT captured – you will have
to use a reasonably senior staff member to undertake the sort of
inexact exercise described above.
So, one arrives at a most remarkable discovery!
small amount of time preparing a comprehensive and well-structured list
one moves from a massively inefficient situation to a highly efficient
situation that enables you to literally answer EVERY POSSIBLE QUESTION
about Credit Note reasons, and thereby, a whole range of related
Imagine the difference if EVERY single drop down list in your entire
business information system environment were populated with data of
comparable quality and comprehensiveness! This is how one
begins to moves one's systems from the mediocre to the exceptional as
presented on the graph below, as presented in several recent articles:
Executive Briefing to give you more insight
To obtain deeper
insight into what is presented here attend my Executive Briefing
"Business Systems in Strategic and Competitive Management " –
Thursday 14th May 2015, London, UK – fee £275 per delegate
VAT, group and early bird discounts available
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here for more information or click
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that the LAST category in the new list is "Other" – in nearly
all cases there is a real possibility of an item being left off the
list when the list is developed.
By having "Other" as a separate category at the END of the list you
trap those instances in a controlled manner since, as long as the list
is comprehensive and well presented, by the time the clerk gets to
"Other" and has NOT picked a valid description, then the probability is
that there really IS a category that is NOT catered for.
In that case you NEED "Other" because, if you do NOT have "Other" the
clerk will either end up dumping the transaction against the nearest
misfit OR, much worse, adding a hasty new item to the list which is a
cast iron guarantee that the quality of the list will degrade rapidly.
Addition of new codes should be tightly controlled by a senior person
who understands the fundamentals of what is discussed in this article
and, if you develop the list systematically and thoroughly with correct
facilitation, addition of items should be an extreme event.
Addition of even ONE inexact item to a list starts to break the quality
of the list – note that this is entirely reasonable – we live in a
world of precision and therefore it is entirely appropriate that we
apply precision to the management of our system master data!
Either way NOT having "Other" results in a mess of varying degrees of
severity and a return to questionable and unreliable data and the
inability to accurately and dependably answer EVERY POSSIBLE QUESTION
relating to returns and credit notes with a few mouse clicks.
"Other" should be monitored regularly and, in the event that there is
material use of "Other", the required extra codes should be carefully
added and / or the required training and discipline administered.
1.4 Another example
may have looked at the example above and concluded that the
original list of three items was over simplified and that was the real
problem. Consider the following example from another
organization (also credit note reason codes):
Don't like my face
we messed up
Salesman sold too little
Value to the customer being questioned
Wrong module on it
Goods not received
GRN does not agree with PO
Time sheets do not agree
Work not authorized
Note the overlap between "we messed up" and various other
items. Again any analysis based on this list will be inexact
and manual intervention will be required. Because the list is
NOT structured it is likely that there are gaps in it and therefore
further items will be added to the list on an ad-hoc, on the fly, basis
resulting in further quality degradation and analysis challenges.
This list was reworked into the following headings:
I PROJECT CONTROL ISSUES
L VALUE PERCEPTION
N UNAUTHORIZED WORK
S UNMET EXPECTATIONS AND SALES ISSUES
V VENDOR ISSUES
X ADMINISTRATIVE ISSUES
This list should be extended to a further level incorporating all
relevant items in the first list, plus a comprehensive set of further
sub-sections that FULLY describe the possible reasons for issue of
Credit Notes to result in a fully formed list like the more detailed
example in section 1.2 above.
Notice that even at this level of detail the above structured list will
give rise to far better management information than the original
principle is universal -- badly structured validation and
classification data results in GROSS inefficiency whilst highly
structured information based on a strategic executive view of the
business gives rise to ORDERS OF MAGNITUDE improvement in management
information, and all the associated benefits that result from
this. These benefits include efficiencies in system and
business operation and savings on technology staff and system
It is important to realize that the formulation of the major categories
of a hierarchy is an art that benefits from considerable experience
with classification schemes coupled to diverse business
insight. A poorly formulated new list will give problems in
time, so the use of a specialist facilitator is advisable.
1.5 HOW to get there
do you get to the second version of the above list?
The steps are quite basic:
a. Get a few key staff members in a room with an experienced
facilitator who understands data and the classification of data AND
understands business. In many organizations you may only need
one or two staff members and, even if you do NOT have an experienced
facilitator, IF you follow this process you WILL produce a MUCH better
result (remember however that if you cut corners you will suffer
b. Make sure that your choice of staff in the working session is FULLY
representative so that ALL possible reasons for issue of a credit note
reside in the heads of one or more of your delegates so that your final
list is as comprehensive as possible;
c. Brainstorm ALL possible Credit Note Reasons – no interruption, NO
debate, just dump until everything is out – have a fast typist record
all the items in a spreadsheet displayed on screen. Very
important -- you
should have a listing of ALL Credit Notes issued in the last few years
on hand for reference in order to ensure that your list is
d. You should also have the existing content of the Credit Note Reason
drop down list, this is an important input to your brainstorming –
everything in the existing list MUST be catered for in the new list;
e. Individually formulate between five and nine major categories of
reason as in both examples above (the capital letters) – the cognitive
span of the average human being is between five and nine.
That is the maximum number of headings that any person can get their
mind around quickly in order to post fast and accurately.
Seven is the optimum number for speed of recognition and accuracy of
f. Type these up on-screen for each person;
g. Collaboratively derive a single list of major categories that all
members of the team agree with. With experienced facilitation
this goes fairly quickly for a small list such as Credit Note
Reasons. As mentioned above, the development of a quality
hierarchy is NOT axiomatic, an experienced facilitator will add
h. Set these up in capital letters as headings for the detailed
hierarchy – note that it is a convention with regard to this approach
that operators should NOT post
to the headings, they are for information and to provide structure for
consolidating the data only;
i. Take the detailed brainstorm list and allocate every item on it
under one of the main headings, cleaning up and tightening wording as
j. Sort the list so that the most strategically critical items (the
essence of the business) are at the top and the more mundane
are at the bottom. Put "Other" at the very end;
k. Note the use of Capital letters for the headings and proper case for
the posting level items. This makes the list easier to scan
to find the correct category – the focus is always speed and accuracy
l. Note the use of Indents to highlight the headings and the child
categories. Again for speed and accuracy of allocation –
force the indent with a leading period or underscore if necessary with
the software that you are using. With a well-structured list
operators will NOT be using "Find" they will be navigating the
hierarchy so a leading space or period is NOT an issue;
m. Note the use of trailing periods (decimal points) in the codes in
order to highlight and follow the indents. This allows
software to easily summarize the data and easily drill down;
n. Note the use of mnemonic alpha codes as far as possible – if the
first letter of the word does NOT give you the sort order you want use
a key letter from within the word or phrase – staff will rapidly pick
up the association and remember the most frequently used
codes. This again contributes to accuracy and speed of
posting – remember the Case Study above. Only use numbers if
nothing else makes sense, for example where a very specific sort order
is required and you cannot develop mnemonics that fit. An
experienced facilitator will add value here also;
o. Validate the list for completeness with all personnel who are
involved with using that particular list, whether as data capture
clerks, operational staff or managers and executives who will query the
data. Refine and tune as necessary – allow for three
iterations as a general rule;
p. Load into your operational software. In most cases this
will be a simple back-end import. In order to maintain
whatever intelligence is in the history you may retain the old codes in
the list as well but, in that case, you should make sure that you code
the new codes so that they occur first in the list with the old codes
lower down in the list and clearly separated with a heading to say "DO
NOT USE CODES BELOW THIS LINE" or similar – note that after a year the
scrappy history will largely be a non-issue.
The above is quick and easy to do, it will require no more than an hour
or two to develop a rigorous and complete list of Credit Note reason
codes in most organizations, a bit more in very large organizations
with multiple departments with different reasons. In such
cases you may need several working sessions and several review
iterations. Remember that it is vital to have a SINGLE list
for the entire enterprise in order to enable you to analyze any way you
want at the executive level and to be able to drill down to the data no
1.6 Other small lists
this process for every small stand-alone validation list
throughout all your systems, whether there really are only three
entries or whether there are a hundred. This can
be done quickly and easily in any enterprise and will deliver
significant value. An experienced facilitator
will assist you to achieve a high quality outcome at best possible
1.7 Integration with supporting systems
some cases you may find that add-on software or spreadsheets have
been developed using the old classification data. Inevitably,
when you change the lists these add-ons will be broken and, in many
cases, they may NOT be required any longer. If such
integration is a possibility in your organization the above process
becomes somewhat more complex in that you will need to undertake an
impact analysis and take measures to modify or replace any add-on
In some cases this could translate into a major activity in which case
an executive level decision will be required as to whether you live
with the existing data or replace it with new high quality
data. This is a major reason why, when you DO apply these
principles, you take the time to do the new list right first time – for
this reason use of an external highly experienced facilitator is
In some cases you may find that changing these lists will break
integration with other major systems or other modules. Again,
assess the impact and take an informed business management decision.
From where I sit, based on the very substantial benefits that result
from having high quality data, I advise you to "bite the bullet" and
take the pain – my strong recommendation is that over time you upgrade
ALL your data using the principles advocated in this article.
In the case of major integration impacts you will probably be advised
to delay the implementation of the new code scheme(s) that impact the
integration until you have developed a comprehensive plan in line with
the items discussed below.
Two day consulting
intervention at reduced fee
Information System Configuration Health Check
In order to get you
started I am offering a two day consulting and facilitation
intervention in which I will visit your business, review your systems
and give you a headline professional opinion on the health of your data
and what is required to raise the bar to the standards set out in this
will include a
half-day facilitation session relating to a few of your smaller
tables. This intervention includes the first day at NO charge
to make it easy to get to know me and see whether these techniques
really WILL add value to your business. Fee £525 for the
second day plus travel and accommodation outside of London, UK.
Offer valid for interventions booked not later than Friday
March and work executed and paid for not later than Friday 24th April
here for more information or click
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2. Adding new lists / attributes – the NEXT
step towards answering ALL questions
2.1 The opportunity
now I hope that you have, at some level, recognized the very
substantial benefits of having highly structured, comprehensive and
well thought-out code schemes in all your minor classification lists.
However, this will ONLY allow you to answer the questions for which you
already have lists, such as the Credit Note Reasons.
The NEXT step is to add EVERY POSSIBLE validation list that you can
think of to every possible master data table:
f. Mobile Plant
g. Fixed Plant
l. Accounts and Financial
Go through every single master file and brainstorm every possible
attribute that you can think of that you EVER use to describe that
particular logical item. Set priorities in terms of current
pain and expected business benefit.
To undertake these sessions you require quality time from your
Executive team and other staff all the way through the
organization. Remember that IF you want to answer EVERY
possible executive question you MUST have EVERY possible attribute,
including particularly those attributes that ONLY the executives take
into account. An experienced facilitator can help you to do
this faster and more accurately and also spot opportunities that you
give you an example of the sort of additional list I am referring to:
Some years ago I sat with the CEO of a company that sold Golf
requisites including Golf Clubs. I asked him "what are ALL
the possible attributes of your major product lines?" Naturally enough
we started with golf clubs and one of the first items he listed was
"Golf Club Sound". He went on to explain that different golf
clubs make different sounds when they strike the ball -- "clicky" and
"clunky" were two sounds he listed. The sale of golf clubs is
influenced by the sound of the clubs in use on the PGA
leaderboard! If the clubs in use by the leaders have a
certain sound, sales of clubs with that sound increase and sales of
clubs used by those that have dropped off the leaderboard with other
sounds, decline. Thus, from a sales and marketing, pricing,
stock management and other strategic perspective knowing the sound that
clubs make can be extremely valuable and significantly affect
In every organization there will be fields like this -- attributes that
you use to describe customers, products, etc that, if incorporated in
your data, would open the door to all sorts of interesting analyses.
2.2 How many fields to add?
many extra fields should you add?
As many as you can possibly imagine being relevant! --
Remember that IF the field is there and populated you can answer THAT
question and all questions associated with that field – if the field is
NOT there you are back to the senior staff member, spreadsheets and
research – the negative impacts and real costs of cutting corners here
These extra validation lists can be easily added in most modern
business system suites and certainly in all the leading
brands. They are also easily added to even the most archaic
legacy system as long as you still have access to the source code and a
competent developer who understands the software.
Do NOT be shy, add EVERY possible attribute you can think of.
In real terms it costs you very little to add the extra fields and,
once you are adding one field it makes very little difference in terms
of time and cost if you add ten fields to a particular entity
(table). The planning, version control, testing, etc are
almost the same whether you add one field or ten fields.
The time taken to populate the validation lists, once you have gone
through the content development process outlined above a few times, is
small and, again, once you take account of the time required to get the
people in the room, brief them on the process, review the results, etc
it makes little difference whether you develop content for one list or
for ten or more. Again, the real cost of NOT doing this is
much greater and is an ongoing never ending waste of time and money!
The key thing to keep in mind is that the LONG TERM benefit of having
every possible attribute is GREAT.
Note also that the process of classifying individual items at take-on
is NOT greatly impacted by the number of validated
attributes. Design your coding sheets, if you have them, to
reflect ALL the codes and the take-on will proceed quickly.
The additional finger on the keyboard time to capture a few extra codes
is NOT great, particularly once your staff have learned the more common
codes – refer to the CRM Risk Control case study above and the dramatic
data capture productivity gains that were associated with
well-structured, intelligently coded data and codes that were easy to
3. What next? – data NOT in the system
next step in answering EVERY question is to capture ALL relevant
data from external sources in your data warehouse. This is
primarily an executive level requirement. Identify ALL
external data sources that you regard as having an impact on your
business -- commodity prices, stock market prices, trade indexes, you
name it, if you use it on a regular basis or even on a NOT so regular
basis, create a table in your data warehouse.
You DO have a data warehouse don't you?
If NOT it is time to get one, NO significant business should be without
Either create an electronic feed or a manual feed (clerk at a keyboard)
to capture this data at the required frequency, daily, hourly, etc as
Do NOT get into massive debates, IF the data is available and it is
relevant, just capture it.
Do NOT be seduced by arguments that this is "too much" – that is ONLY
relevant IF you are going to incur significant data provision costs on
an ongoing basis, in which case compromise may be required.
But the data that is regularly used, should ALL be captured and linked
back to your operational system data, in whatever manner is appropriate
to allow you to make the necessary association. For example,
if you own a flour mill, you will want the daily closing spot price for
wheat so that you can compare the price you paid per shipment to the
market price and analyze trends.
4. What next? – the BIG classifications
the above items are the EASY items.
By doing what is listed above, even if you do NOT do the external data,
you will be starting to obtain substantial GAINS relative to what you
had. You can do the first three items listed above at a pace
that suits you, either heads down and done in a few months or a medium
term project to upgrade all those items over a year or more.
It is up to you, but the gains are such that I advise that you move at
best possible speed.
However, once you have fixed the items discussed above, you will start
to bump your head against a MUCH bigger challenge – the primary
classification of your MASTER DATA. I am referring here to
your Materials Group, Item Class, Product Class, Employee Category,
Chart of Accounts, etc – the classification lists that typically drive,
or are intended to drive rich functionality in your main systems.
Here the problems are diverse. In some cases the quality of
this data is so shockingly poor that there is NOTHING of value being
done with the data. In such cases there may be all sorts of
add-on functionality, third party software, etc that is trying to deal
with the mess or work around it.
When dealing with these major classifications it is vital to have an
expert undertake a thorough impact analysis and evaluate your options.
There are broadly TWO alternative courses of action:
a. Fix the classification in the Data Warehouse ETL
(Extract-Transform-Load) and then, in time, drop the classification
into the operational software. The initial step will take the
20% of the effort that will give you 80% of the high value outcome,
albeit with limited operational benefit. You will probably
need to make some adjustments to the operational data;
b. Fix these things in the operational software from day one – this
will give you the operational value as well – do this either
incrementally or, if you are really ambitious, you could embark on a
partial or complete re-implementation of your system (same system, new
In the case of your Data Warehouse, consider creating a completely new
instance of the Data Warehouse and progressively pulling
well-structured data into that instance while leaving the old instance
running in parallel. Develop the Transforms by mapping the
individual master data records with the new classification scheme.
There are cases where this will NOT be practical and only a
completely new list is practical.
Develop the classification of each Master Classification using
basically the same process as described for the small lists, but with
the understanding that you need a MUCH more experienced facilitator,
with bigger delegate groups, with much more rigorous classification
skills and more complex coding schemes. As a consequence,
developing these lists WILL take time and cost money. See the
Case Study for an indication of the value that results from
doing this exercise.
In doing this it is vital to ensure that there is ABSOLUTE congruency
of logic between different lists and corresponding lists in different
systems. If you have a classification of products in your
manufacturing system you must have EXACTLY the same classification in
your ERP and in your warehouse system (and your General Ledger to the
extent applicable). These companion lists may be summarized
at different levels of the hierarchy, but the SAME structure and
hierarchy MUST occur everywhere. In this context it is VITAL
to ensure that ALL disciplines in the business which are impacted by a
particular classification are involved in the development of the
content of that list. Accounts working in their silo
separately from manufacturing in their silo, etc is a recipe for more
ineffective and inefficient system operation.
Notwithstanding the significant time and effort required to do these
things, it is vital to realize that the benefits of getting this right
will be SUBSTANTIAL! Refer again to the curve of exponential
improvement in value yield above and also the ASCO
Note again that this is NOT about technology; it is about accurately
modelling the business and the real physical world IN the
data. The lists and code schemes are technology independent
although the exact focus of the Master Data lists IS a function of the
target business information system to some extent.
Once you have commissioned the new classifications, not only will you
suddenly be able to answer a wealth of new questions, the operation of
your systems will become more streamlined and efficient, and you may
well find opportunities to add neat custom software functionality, as
discussed in the next section. See the simple example of
Credit Note Reason codes as a "taster" of the rich value that can be
unlocked by applying these methods to your Master Data classifications.
The development of these lists is a highly specialized field that I
refer to as Strategic Engineered Precision Configuration and makes use
of Precision Taxonomies. This is outside the scope of this
article but is discussed
in detail on my website, see the detailed Taxonomy Manual for
download on this page or read
Two day Critical Factors course to get your
one or more of your staff to my two day course, "The Critical Factors
in the Strategic High Value Application of Business Information
Systems" to be held on Wednesday 20th nd and Thursday 21st
May 2015, London, UK.
Fee £475 per delegate, discounts for three or more delegates and also
for early payment.
Also available to
be presented in-house if another date or location would be more
here for more information or click
here to book or see details at the end of this article.
5. Custom software driven off the
that you have well classified Master Data, PLUS all possible
attributes on your Master Data, your system suddenly becomes HIGHLY
INTELLIGENT -- it now knows a very substantial amount about the
business, FAR more than it did previously and in a highly structured
manner (same software, different classification data!).
This opens the door to develop all sorts of business specific custom
software of limited scope to enhance the information yield and
functionality of your business systems.
Refer to the ASCO
Case Study (doing things differently and better) for a
detailed discussion of a real example of such an implementation and the
benefits that accrued from a few small pieces of software that I
specified that made full use of the business knowledge embedded in the
We were able to use the highly structured brand related Product Class,
and a number of business specific product attributes to drive
hierarchical addition of Product records in the Product Master file,
cascading Product attributes down the hierarchy so that the Product
Record was extremely clean and precise.
We were also able to automatically generate brand related projects with
structured expense categories in the Projects module of the ERP for
Brand Management purposes. This gave the business an
extremely powerful Brand Management tool at very modest cost, with
associated significant competitive benefits. This is the
power of having highly intelligent data.
It is the development of small pieces of strategically "clever"
software that harnesses the full potential of highly structured and
highly intelligent data that can push a client organization to the top
right of the value curve above. This is a very different
world to the world in which most organizations operate relative to
their systems. This new world is one of exceptional business
efficiency and effectiveness, increased competitiveness, growth and
This capability will, again, add answers to a further range of
questions in your growing arsenal of strategic and operational
Inherent in this component is a requirement that code schemes and
hierarchies are rigorously consistent across ALL systems, and all
modules of major systems. A situation in which separate
instances of the same software exist with different code schemes for
the same Master Data for different departments, such as Accounts and
Human Resources, is totally out of the question.
Consistency and congruency are critical. The same applies to
consistency and congruency between the operational modules and systems
and the ERP – one universal family of codes is absolutely
ESSENTIAL. This is a major reason why the overall custody of
the integrated business system view MUST sit at the CEO level – refer
previous articles on this topic.
By the time you have reached this point you will have dramatically
raised the bar in terms of corporate effectiveness and efficiency, with
resulting material increases in overall business efficiency and
productivity. Increased quality of strategic information, and
quality of decision making will result in significantly increased
competitiveness, growth and profitability.
6. Enterprise modelling – the General Ledger
and the Cubic Business Model
you have grasped the benefits of the approach outlined above I
hope that you will be starting to see the final piece in the jigsaw
puzzle – enterprise modelling – a highly structured logical
(hierarchical code) model of the entire enterprise that accurately
models the real world complexity of the entire enterprise.
This sounds obvious, and many organizations believe that they do this,
however, in practice, every organization I have ever encountered ends
up going outside their systems, making approximations and doing large
amounts of manual work in spreadsheets, using highly qualified staff
members to do the work. Virtually NO enterprise has a live
model in their data that truly delivers what I am referring to
here. Remember that I am coming from an engineering
perspective directed at creating an extremely powerful model of the
business in a manner that will enable you to run your organization to
standards of excellence that are generally NOT associated with business
information systems and ERP in particular.
The basic approach to business modelling that I am referring to here
originated out of a 1,000 hour research project that I undertook many
years ago with a view to developing an absolutely rigorous enterprise
Chart of Accounts. It proved MUCH more difficult than I had
anticipated (I quoted the client 40 hours).
The first client where I fully applied these principles phoned me a
year after commissioning to say "James,
this is amazing, we have a massive range of management information and
the audit has been cut from six months with qualifications to six weeks
unqualified and we did this with one LESS staff member!" –
see the V3
case study on my website.
The business is modelled as a hierarchy of coded information "cubes"
(NOT the same as Business Intelligence cubes), each distinctly modelled
in classification schemes, comprising logical dimensions of:
a. "Location" – highly structured hierarchical list of where we do what
b. "Function" – highly structured strategically focused hierarchical
list of what we do;
c. "Accounts" – the enterprise Master Chart of Accounts designed to
give a consistent and congruent Chart of Accounts for the entire
enterprise and used to drive a mini Cubic Business Model Chart of
Accounts behind every location and function intersection;
d. The "Accounts" combined with "Location" and "Function" yield a very
precise Cubic Business Model income statement and balance sheet for
every business unit. These mini financial statements should
be determined by the Chief Financial Officer in consultation with the
Chief Executive and operational executives. Note that the
recent approach of using "Dimensions" as attributes on the General
Ledger record is NOT suitable for this approach. It is essential that
this model is executed using the conventional approach of creating
discrete accounts for every Account-Location-Function intercept, and
ONLY for those that are valid, from a business management
perspective. This is an inherent requirement of the precise
modelling approach being advocated here.
e. All the other dimensions – personnel, projects, products, assets,
mobile plant, inventory, etc, etc;
All the above in the form of hierarchical structured lists that
logically model the real world complexity of the business in a manner
that permits roll-up and drill down, with congruent and consistent
classifications and code schemes across every single system in the
Inherently, the best time to develop this capability is when you
commission a new system, in which case the Cubic Business Model can be
installed as the foundation of the entire system configuration and
underpin the integration.
Alternatively, you can develop the Cubic Business Model as a component
of the transform layer in your enterprise data warehouse, and map the
existing Charts of Accounts in your existing operational systems into
the data warehouse. This will allow you to quickly and
effectively combine data from diverse and unrelated business
information systems into a single enterprise repository.
By doing this you do away with the need for all businesses to run the
same software and can accommodate one division running thirty year old
legacy systems and another running the latest and greatest products
from any of the leading global players. This is again a
matter of doing the 20% of the work that will result in 80% of the
enterprise decision support value. Refer to the Rennies Group
case study for an example where this approach was used to provide a
consolidated financial view across over 200 companies ranging across
trading, travel, transport, logistics and other fields.
implementation of the Cubic Business Model Chart of Accounts design and
associated principles, protocols and disciplines will greatly improve
the quality of your management information; greatly improve management
control and accountability; significantly reduce back office,
administrative and audit costs; and lead to improved business
efficiency, effectiveness and profitability.
Over time you can cascade the new classifications down into the
The development of the Cubic Business Model to the full extent
envisaged here is a highly specialized field that requires very
specific methods, techniques and experience. I have developed
specialized software, now in its third generation, to ensure that the
coding and structure of the Cubic Business Model is absolutely
consistent and precise, which is a necessary requirement to unlock the
full potential of the method. The precision data that results
from application of these principles enables exceptionally powerful
reporting, modelling and analysis capability, enabling the business to
answer questions that it did not think could be answered directly off
its core systems.
Conclusion – answers to ALL the questions YOU
can ever think to ask -- NOW!
the time you have taken ALL the steps listed above you will be in a
position where you will be able to obtain the answer to EVERY POSSIBLE
QUESTION you can reasonably ask relative to ALL core elements of your
business and many NON-core elements. Inquiry and reporting,
modelling, dashboards and alerts will be much easier, highly
streamlined and highly effective with new and more complex analyses
easily achieved. Electronic on-line, real-time drill down on
reports, models and dashboards will also be a matter of
routine. You will have done this with the same operational
and Business Intelligence and reporting software that you started
with. You will also have added many years of life to that
operational software, even if it is legacy software.
You will also have massively boosted the effectiveness and efficiency
of your systems and, by extension, massively increased the level of
decision support to staff at all levels from the CEO down.
You will, effectively, have
TURBOCHARGED your existing business information systems AND your
The bottom line impact of this approach will be substantially improved
operational effectiveness and efficiency through greatly improved
decision making leading to greatly improved competitiveness, growth and
What sets James
A Robertson and Associates apart in this field is an extremely broad
and diverse base of knowledge and experience built on a foundation of
engineering rigour in the use of computer systems as precision analysis
and modelling instruments, coupled with very rich experience in the
creation of highly structured and highly intelligent data.
This is informed by military command training associated with the rapid
acquisition of critical information leading to rapid high value life or
death decisions. All of this is coupled to grounding in
economics, investment and strategy associated with enabling high value
decisions. This knowledge and experience set is greatly
enhanced by dozens of investigations into failed and sub-optimal
business information system projects and implementations over a period
of over 25 years.
The entire approach is focused on enabling high value (thrive)
decisions that support the essence of the business and how it thrives,
and I am therefore well placed to assist you to implement the
recommendations in this article. Note that ALL the concepts
and principles in this article have been assembled and, in many cases,
originated by the writer, over the last thirty plus years of
involvement with the use of computers in business.
can assist you to take the initial steps on the journey above, and I
can facilitate you through the entire journey – these are methods that
I have personally developed and tested and which I am uniquely well
placed to assist you with.
To help get you started I have developed three service offerings that
will enable you to engage with me at no risk and little cost, a two day
system health check, a half day executive briefing and a two day short
course -- these are outlined below with detail on my website:
Two day pilot consulting intervention --
Business System Configuration Health Check – promotional pricing --
£525 for two days
am offering a special promotional "get to know James" consulting
package comprising two days on site, the first day at my expense, in
order to demonstrate my confidence in what I am offering.
During this intervention I will evaluate your systems and advise the
scope of what is required for your organization to reach some or all of
the above levels – as you stipulate.
On the second day I will facilitate a half day workshop to assist you
to develop the classification schemes for an agreed selection of small
lists as discussed in sections 1 and 2 above. My fee for this
intervention will be £525 -- nothing for the first day and £525 for the
second day, provided the work is ordered by 31 March 2015 and executed
and paid for by 24 April 2015. Payment terms 7 days from
completion of assignment. I have great confidence that you
will receive considerably more value than this fee.
This fee EXCLUDES VAT and travel and accommodation outside of London,
This two day
intervention will show you a number of easy measures to improve the
quality of your business information systems data
immediately. These recommendations will relate to steps that
will facilitate better decision making and will reduce frustration and
time wastage associated with system information requests.
More information on my website or email
me to obtain more information.
here to place an order and secure immediate benefits.
Executive Briefing – Business Systems in
Strategic and Competitive Management – Thursday 14th May 2015, London,
fee £275, group and early bird discounts apply
strategic and competitive application of business information
systems is constantly hyped and sold, and seldom delivered – this
briefing informs and equips business executives and managers to take
charge of their business systems as valuable tools in their strategic
and competitive arsenal.
This Executive Briefing will be presented at 09h30 on the morning of
Thursday 14th May 2015 in Victoria, London, UK and will run for four
hours. It will be followed by a light lunch and an optional
This event can also be presented in-house.
The fee for this event is £275 with discounts for multiple delegates
and early payment -- £175 per delegate for three or more delegates
booked and paid for by 27th March 2015 -- a £100
discount. This fee EXCLUDES VAT.
More information on my website, or email
me to obtain more information
here to book now – seats are limited.
Two day course – The Critical Factors in the
Strategic High Value Application of Business Information Systems –
and Thursday 21st May 2015, London, UK – fee £475, group and
bird discounts apply
business managers responsible for your systems to see the
application of computer based systems in their sphere of influence in a
new way. Also equip technology managers to understand the
REAL issues in the effective strategic application of the technology
they manage, and commence a new dialogue with the business.
This two day course will be presented on Wednesday 20th and Thursday
May 2015, in London, UK and can also be presented
in-house. In this course I will discuss the principles
discussed in this article in detail and give delegates an opportunity
to practically apply what they are taught, with data from their
The fee for this event is £475 with discounts for multiple delegates
and early payment -- £315 per delegate for three or more delegates
booked and paid for by Friday 27th March 2015 -- £160 discount.
More information on my website, or email
me for more information.
here to book now – seats are limited.
James A Robertson
and Associates offer a range of services directed at enabling clients
to put in place comprehensive measures to achieve the level of system
effectiveness and efficiency discussed above in such a way as to give
lasting high value low lifetime operating cost outcomes.
This includes a
range of in-house presentations on topics such as "Why your Business
Information System is NOT delivering and HOW to FIX it", "Business
Information Systems in Strategic and Competitive Management", " The
Critical Factors in the Strategic High Value Application of Business
Information Systems" and "Lessons from the Bridgestone – IBM case
All of these can be
delivered as one hour presentations, half day executive briefings or
two day courses. They can also be presented in standard
format or tailored to your organization through a series of executive
interviews. Translation of slides to another language and
presentation through an interpreter are also offered.
I also offer short,
sharp diagnostic interventions to determine why your business system,
department or project is NOT meeting your expectations or is stalled,
including easy to understand actionable advice on how to turn the
I will give you an
independent evaluation of the health of your existing systems and give
guidance on whether they REALLY need to be replaced or not and, in many
cases, advise how to greatly extend the life and sustainability of
click here to email me for more information.
Articles published so far in the article series
to which this email refers:
Strategically Enriching your Business
of practical specific measures that can be taken in order to
greatly improve the information yield of business information systems
at both the operational and executive strategic level. A
number of simple steps that can be taken immediately and more complex
measures that can be taken over time.
This thread is discussing increasing business system and data warehouse
value yield using techniques that lead to significantly improved
business intelligence capability, including support for the ability to “obtain
answers to questions we had not previously thought to ask”.
This builds on the content in the Strategic Essence and Real Issues
threads. Articles to date include:
Principles of Data Engineering
Steps in Applying these Recommendations
Robust Business Information Systems Procurement
order to fully apply the methods and principles discussed in the
threads above with regard to new systems it is vital that a robust and
effective approach to procurement is applied. This requires a
tough procurement approach directed at achieving a tough business
outcome orientated project that ensures a high value outcome.
This thread discusses the components of such a procurement
approach. The individual documents and processes that make up
the approach are outlined. Thereafter the components are
discussed in more detail. Articles to date include:
Bill of Services, Laboratory, Go-live Certificate, etc
3: Executive Engagement, Bid Compliance, Adjudication and other matters
Information Available on the Website
browse my website for more information
The home page, http://www.James-A-Robertson-and-Associates.eu
will give you a good overview of what I am advocating and help you to
navigate the entire site.
of Contents lists all the webpages on the site, there is a
lot of deep content that is NOT immediately visible.
Catalogue contains well over 150 articles on diverse topics.
Keyword Cloud provides alphabetic keywords linking to many of
page lists around 90 conference presentations, nearly all
different with around 40 of the presentations live on the site for you
to view and download -- email me if there is a presentation you would
like to view that is not on the site.
If you would like to know more about me there is detailed
information on the website and further detailed information
Visit the Testimonials
page to hear and read what clients and others have to say about me
Visit the Failure
Catalogue to get a realistic perspective of the severity of
the problems with the business information systems implementation
industry. There is also a description of what I mean by the
in this context
The page on The
Critical Human Foundation will give you some idea of the full
diversity of the matters that I take into account in advising my clients
Please contact me for more information
look forward to discussing how I can assist you to unlock the FULL
value of your Business Information Systems investment, no matter which
software you have, how old it is or how dissatisfied you are with it