Repeatable Strategies for Business TechnologyBy Faisal Hoque | Posted 2009-06-05 Email Print
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Business technology management boosts performance at Coca-Cola Enterprises.
In 2006, when Esat Sezer joined Coca-Cola Enterprises as senior vice president and chief information officer, the company was facing rising costs and flat revenues. It had failed to keep pace with the rapidly changing business landscape that included shifting consumer preferences, retailer consolidation, and rising production and delivery costs.
Operating in 46 countries with 74,000 employees, the company is the world's largest marketer, producer, and distributor of Coca-Cola Company products. It services 414 million consumers and one million retail stores, and supplies products to more than two million vending machines, beverage dispensers, and coolers.
Sezer joined with the senior management team to put together a global business strategy that would expand the product portfolio, transform the go-to-market model, and improve efficiency and effectiveness. During a recent Q and A session with the BTM Exchange, he explained: "To support this strategy to become the best sales and customer service company, we identified the need to make sizable investments in technology and to integrate our technology strategy with our business strategy."
It has worked. For 2008, Coca-Cola Enterprises had net operating revenues of $21.8 billion, a 4 percent increase compared to $20.9 billion in 2007.
“The turnaround was one of the reasons I wanted to join Coca-Cola Enterprises,” Sezer says. “For about 20 years, the company had grown through acquisitions in which we inherited varying processes and procedures. In addition, we were facing the most difficult commodity cost environment our industry had ever seen. In 2007, we created a global operating framework, which for the first time stated the company's mission, vision, and key strategic priorities from a global scale. It also included the core capabilities we needed to invest in and to improve. Technology was identified as a key investment area to support our business priorities.”
Although he may not have called it by that name, this is a textbook example of the strategy and planning principles of business technology management (BTM) – creating an enterprise strategy, identifying the management capabilities needed to execute it, and investing in the technology that will enable these capabilities.
Key Capabilities for Strategy and Planning
To better understand how enterprises can establish strategy and planning processes into repeatable practice, let’s look closer at the organizational capabilities (as defined by the Business Technology Management (BTM) Framework) needed:
The Business-Driven Technology Strategy capability identifies the appropriate strategic positioning, value discipline, and value type of the enterprise, infusing technology into business strategy. It tests and elevates strategy development and execution, establishing the interconnection of business and technology that is essential for enterprise success.
The Strategic Planning & Budgeting capability makes an ongoing, adaptive strategic planning process fundamental to the operating stance of the enterprise, providing for the establishment of goals and milestones. It also grounds the assessment of the effectiveness of the business technology strategy in established financial measures.
The Strategic Sourcing & Management capability supports the creation and management of relationships with those partners best suited to an organization’s strategy. This includes identifying areas of strategic opportunity for outsourcing, co-sourcing, and vendor selection, resulting in the creation and development of value nets and an effective extended enterprise.
The Consolidation & Standardization capability helps enterprises identify the impact of acquiring businesses, products, customers, or other assets and provides the foundation for identifying opportunities for standardization and integration into the organizational and governance structure of the enterprise.