Managing Risk: The Country Doctor vs. the Specialist
We all remember Dr. Marcus Welby – the ultimate ‘Country Doctor’ (Maybe not and I am just dating myself). He knew all his patients, delivered most of them himself and had the ability to cure someone at the brink of death every week. Today we call him a General Practitioner (GP). Our insurance company usually requires us to choose one. They are great to get a physical, quick dose of antibiotics or bottle of syrup to address the symptoms of the cold and flu, etc. They are also the key to get the referral to the medical specialist. Forty years ago we did not have many medical specialists. However, today we are provided a growing choice of medical specialists and sub-specialists.
I had a friend that went to a specialist recently for a broken arm. I had no idea that there was an orthopedic surgeon that only worked on only the right arm. That’s right – your left arm is not his specialty. Now that is a specialist. We would never think of going to a GP for a heart transplant or for brain or spinal surgery or even a zit – only dermatologists do that now. You get my point; we have specialists for everything in the medical field. The challenge with being a specialist is they may know everything about their one area – which is a good thing, but they know very little about the big picture of your health and medical background or any other specialty. Thus, they focus on what they know, and guess what. Their diagnosis or recommendation is usually in their area of expertise, because they look for solutions from within their skill set.
It can be frustrating to see a doctor today. Depending on your insurance plan, first you may have to go to the GP, wait for insurance to approve seeing a specialist, wait again to get an appointment there and then expect to see 1-2 other specialists before you get a diagnosis or a solution to the problem. In the middle is multiple consultations and research. However, we go through this process because we want to be seen by the best, or at least someone who specializes in our medical problem. While we desire the simplicity of a country doctor, we desire the knowledge of a specialist. Thus, the ideal situation is an organization with a team of specialists supporting a team of GP’s.
When I started my business in 1980, to be a computer expert all you needed was to know how to insert a floppy disk and find the “Any Key.” (That ‘Any Key’ joke still puts a smile on my face after 30 years.) Back then computer consultants were the ‘Country Doctor’ of technology. Systems were not that complicated, you had limited options and the customers’ expectations were low.
One consultant typically addressed all of a customer’s technology requirements: hardware, operating systems, network, software, training, etc. If they had basic accounting and bookkeeping skills, general computer skills, had used the application before and some business experience, they were an expert at that time. Their knowledge was broad, but not particularly deep on any subjects. The customer appreciated a one-on-one personal relationship and someone who understood computers and the application and had a basic understanding of the business needs related to computerization. Thus, like the country doctor, the solutions were not always optimal for the problem to be solved.
The computer industry is challenged today because clients still want the convenience and the one-to-one intimacy of the earlier ‘country doctor’ consultants with the expertise of hundreds of system and application specialists. In a short period of time, like in medicine, expectations grew exponentially. Computers and computer applications became very complex with thousands of options to meet customer needs. Being a generalist is no longer a viable option because no one could know everything about all components in the business system, including hardware, software, network, integration, custom development, application work flow and the associated business, sales, supply chain, manufacturing and accounting experience.
So how do we meet customer expectations and still minimize the risk? Customers’ demands are exceeding the ability to deliver, especially with the defined budgets and delivery timeframes. “I want it all, I want it flexible, I want it cheap and I want it now.” Competing with 99 cent apps and instant delivery, even FedEx is getting too slow for today’s expectations.
Part of the expectations disconnect is the value proposition of the expert. We can all agree that if someone does something every day they will be more effective and more efficient at doing it and will significantly reduce the associated ricks due to their experience. We can also assume that that expertise costs more to deliver.
I often describe a business like a body. The business software – ERP, CRM and HRMS applications – are like the brain and central nervous system of your business. It connects to all aspects of your business providing information back to a central brain that allows you make decisions and continue to thrive as a company. If you do not think so, turn of your ERP or CRM system for a few days and see what happens to your company.
So, if you were having a problem with your brain, who would you visit? Would you look for the local GP? Would you minimize the description of your symptoms to get the best price? Would you think that 20 miles is too far to travel? Would you negotiate the cheapest price you found on the internet? Or even worse – try to do it yourself?
I expect not. I know I would be looking for the expert – the brain specialist. I would be asking how many times they have done this procedure. Why are they my best hope of a successful recovery? Sure I would ask about expected price and location and that would weigh into my consideration, but those factors would be way down the list from what can this expert do for me to minimize my RISK. At the end of the day, if I am dead I will not be appreciating the fact I saved $20 an hour on my brain surgeon or he was in driving distance.
So why do we look at business systems in a different way? Why is it better to utilize the local GP consultant that supports a few clients instead of a team of experts an hour away or even in another state? Why do we look for the cheapest hourly rate vs. the highest skill sets? Do we think that all consultants have the same skill sets? ERP, CRM and HRMS applications are the central nervous system of your business. Why would you trust that to anyone but a team of specialists? Why would you not look for a consultant with significant team resources and significant experience backing them up?
All too often we see that companies have the time and money to do it right the second time but cannot afford to do it the right way. Companies seem to focus on hourly rates or miscellaneous costs like travel time to save the company money. Hourly rate is only one variable in determining value and minimizing risk. Travel is usually an immaterial cost in an implementation engagement. Do not let these be your primary selection criteria. The most expensive hourly rates usually equate to the best value and greatest risk mitigation because they are reserved for the most senior and experienced consultants.
Most companies change their ERP business software every 7-10 years. Most Controllers or CFOs have experienced a few ERP implementations in their career. No company has significant amounts of underutilized staff in their accounting departments to be able to implement an ERP system with minimal impact to the business – especially the second time.
The next time you are looking at upgrading or replacing your business system, take the same approach you would if you had a loved one facing brain surgery. Wouldn’t you want a real specialist – a leader in the application you have chosen?
Here’s a link to a YouTube video that I found amusing. Unfortunately, we see this approach by some customers when purchasing, upgrading and supporting business software. However, if you are looking for a partner to minimize your risk and provide real value in the consultative approach to your business systems, this may not be the best approach. Enjoy.