Why Your Legacy Procurement Software Has Become An Albatross Around The Neck of Your Savings Potential
Not to strangle to proverbial albatross of doom from Coleridge’s Rime of the Ancient Mariner, but if you believe in the myth that “everything must integrate” with your legacy procurement software, you are probably already suffocating your procurement org’s savings potential.
Here’s a real story. Years ago, I was doing some consulting at a medical company’s procurement shop and needed to pull a few purchase orders from Accounting to see if they matched what I was seeing in the ERP data. By consulting the company directory, I got a phone number in Accounting. That directed me to an analyst who happened to be on vacation, then I ended up losing an hour playing phone tag with the vendor trying to pull the invoice (rather than the purchase order). Instead of sending more emails to nowhere, I decided to just walk down a couple floors to Accounting to see if another analyst might be able to help me out.
This Accounting department was neither terribly modern nor terribly antiquated. The company was publicly traded, and the office layout was a cube farm with centralized Break Room and Copy Room. Each cube had a huge number of file cabinets, all bulging with pieces of paper and I figured I might be in luck as far as locating my troublesome purchase order. Asking around, I discovered the Cube of an analyst who could answer my question, and inquired as to the location of either physical or digital purchase orders.
“No,” she said. “That’s not on-site, anymore. We’re going paperless.”
Noticing that she seemed to be drowning in an off-white ocean of papyrus, I asked if hers were merely the last vestiges of a bygone era, or… what?
My question must have confused her.
“Oh no,” said this analyst. “These aren’t purchase orders. All these papers are e-mails.”
“E-mails?” I asked, incredulous. “Why do you have file cabinets full of e-mails?”
“Because,” she stated flatly. “We’re going paperless. But there’s also a rule that says you can’t keep an email in your inbox for more than 30 days. So every month everyone prints out their e-mail inbox and files it away. Officially, we aren’t really supposed to, but everyone does because there’s information in those emails that we need to get to. If we can’t save them in our inbox then we still need some way to access them.”
In other words, the office’s E-Mail & Paperless Policy had resulted in two outcomes: all of the former paper (including the purchase orders) had been removed from the building and placed in storage elsewhere. The resulting empty file cabinets had been promptly filled with printouts of the emails themselves.
These emails were bulging from every filing cabinet in every cube around the office. I ended up getting a digital copy of the purchase order, but the whole experience left me thinking: if you give a group of people a bunch of arbitrary and contradictory constraints, their workaround will often undo the very purpose of the initial solution.
What does any of this have to do with either Coleridge’s albatross or legacy procurement software?
The albatross in Coleridge’s poem is a giant bird who starts to lead a boat full of lost sailors out of treacherous and freezing Antarctic waters . Perhaps for reasons of hunger, one of the sailors shoots and kills the albatross. This decision means that the whole boat of sailors is basically screwed as far as getting home. Instead of a feathery navigation hack, all they have left is a very massive and very dead bird. Due to poetic justice, the other sailors make the guy who shot the albatross wear the dead bird around his neck.
The whole albatross scenario is exactly how legacy procurement software uses the short-term transactional benefits to keep an entire organization shackled to an outdated business methods. By “requiring integration”, the legacy procurement software prevents the organization from spending less than six figures on any new piece of software (certainly any software created in the past three to five years), and by restricting the pace of its own evolution (relative to, say, any consumer application), the software inevitably becomes a bottleneck.
Much like the burden of a carrying a rotting albatross carcass, or the necessity of printing your entire e-mail every month, people figure out a way to make it make sense. And the way it makes sense is the following sentence: “We need everything to integrate so that all our applications talk to each other.” By prioritizing this constraint, buyers fail to recognize that the reason that they wanted software in the first place is to save time and money, to make their lives easier. If “integration” is always the priority, eventually everything else falls away until the new software doesn’t make much of a dent in the procurement productivity stack: practically the only thing it does is integrate.
The day that legacy procurement software falls behind on enabling the business processes that make the most sense for the enterprise is the day that it becomes a bottleneck to effective collaboration. In effect, the legacy software platform becomes an albatross; from a beacon of hope for survival against impossible odds to a dead, rotting, smelly bird. In a world where adaptation is synonymous with survival, any enemies of adaptation (including legacy integration requirements) can be lethal for the business customer. The albatross learned this lesson the hard way, and frankly so did the sailors. The medical company’s Accounting Department probably didn’t suffer much worse than a few paper cuts, but they sure weren’t doing themselves any favors from a master data management or recordskeeping standpoint. To sum up, Coleridge is cool and procurement software is cool but only when it’s making your business better. If you kill an albatross then your friends might make you wear it and then, hundreds of years later, you’ll be used in a painfully overextended analogy in a blog post about procurement software.