The best business model to adopt in the face of a disruption is that of a conglomerate. Many of these successfully create and grow disruptive businesses within their portfolio. However, the disruptions need to be managed as separate entities - because the resources, processes and values they need to do well will be very different from those of the incumbent. Even the value system they exist in will be different. An example of this is Hewlett Packard, which created its ink-jet printer division at the same time as having a healthy and growing laser-printer division. As the quality of ink-jet printing has improved, the ink-jet printer division has gradually taken over personal printing from the higher-quality laser printer division, which has moved up to serve the departmental printer market. In financial services the small exchanges, electronic spread-betting and trading platforms that merely support transactions rather than provide liquidity, credit unions, community banks for the un-banked and all of the other innovations may appear unattractive - small, low-margin businesses nibbling at the margins of the real money movers - but the incentive for these innovators is to move up, to gradually provide more and more services to those with poor credit histories or those who want to manage their own risks and thereby take them away from the mainstream financial system. And there is very little these institutions can do about it. The only question that remains is how far they can go.
Documentation is not often cited as a method of delivering value in and of itself. I disagree. While documentation is normally reserved for the process control, its effective use can materially improve the speed with which any given deployment delivers value into the business. From a longer-term perspective it can also reduce costs because audit trails of activity and reasoning are clear for management. If all goes well, the management of a technology deployment can be an exciting even exhilarating time. For many however this is not the case. Projects mostly overrun in cost and/or in time - usually the result of a failure to plan effectively. Most don't get the buy-in of the users at an early enough time. Most have things go wrong at some stage causing extra work. One of the key elements of the planning process is of course documentation. Documentation is most often viewed as a necessary evil - the administrative workload is often misplaced and mismanaged. Where appropriate, explanatory notes to documentation steps below will use outsourcing of corporate actions processing - tax processing as an example as this particular corporate action is highly complex and evidences most, if not all, of the issues that need to be discussed from a documentary perspective.
There are different methodologies available to control projects but most have the same elements in one form or another. Beware however of rapid application development methodologies that attempt to provide a ‘quick route' to deployment. Many of these methodologies attempt to shorten the process by missing out documentation steps. This is all very well until something goes wrong, particularly in small software companies.
The pre-business case analysis document is usually a set of smaller research projects which together help business managers scale and scope the key issues and benefits that any given deployment will have. It is used primarily to help business managers create a template for a strategic business case document. Typically this is where the ‘what we have now' scenario is spelled out in terms of what the deployment will address. For example, it may identify a particular department or function (tax reclamation or corporate actions would be good examples). The pre-business case analysis would then identify the key metrics - how many staff are employed in the function, total FTE equivalent cost, location. This document would also identify any existing benchmarks of performance. If there are no benchmarks (which does happen), this document would also note this fact, as perhaps one of the benefits of the proposed deployment would be a set of benchmarks that could be used to make the business more efficient or competitive. Finally, it is equally important in this prebusiness case phase, to identify what is not happening.
In other words, while there may be benefits derived from doing something more efficiently, there may also be benefits from doing something that is not currently being addressed at all. At this stage, there is no real definition of the project or deployment itself. The analysis seeks only to codify, whether quantitatively or qualitatively, the current business scenario, then posit a ‘what if' in terms of output. For example, to use the withholding tax case, the following may be the basis of a pre-business case analysis. So, what may be thought of as an all inclusive service is actually, on analysis a more limited service. So, a project to improve efficiency in tax processing would either have to build a more complex system to deal with layered accounts, buy a solution or more likely outsource it to a provider that already deals with such structures.For each of the key analysis points (KAP), this document will identify what the business currently achieves and also what is available or potentially available through one of the four operational models (build, buy, bureau, outsource). Clearly, the degree to which the initial pre-business case analysis is completed is a driver for the strength of the business case itself.
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