I know the adage is “culture eats strategy for breakfast.” But I think there might be a hierarchical taxonomy on the breakfast menu, with culture at the top, strategy next, then business processes, and technology hanging out somewhere towards the bottom.
Don't get me wrong, technology is important. But it must take its place as an enabler. Information technology, by which I mean all of the technologies that help us create and manage data, information and knowledge, is a tool box. We take the appropriate tools from the box to allow us to complete the job at hand, hence my categorization of IT, including software platforms, as enablers. Technology enables us to produce things, record things, ship things as part of our business processes. We don’t implement technology for technology's sake (or at least, I hope we don't), we implement it to improve efficiencies, cut costs and help us build better processes. In other words, we implement technologies to support the creation of business value.
Why Does Strategy Eat Technology?
"Culture eats strategy for breakfast" is arguing that, while strategy is important, a strong and empowering culture is required for organizational success. The phrase is often attributed to Peter Drucker, and though he didn't say it, he did have a lot to say about strategy. As far back as 1973, he took a fresh and critical look at what the term “strategic planning” meant and that drove his thinking from there on out.
To summarize all of Drucker's writings in a short space is difficult, but we can try to capture the essence of his thinking: the point of developing strategy isn't to try to predict the future. Rather, that developing analytical frameworks and being able to plan to commit resources in what he characterized as an “unknown and unforeseeable” future business environment is the true aim. Indeed he said that strategists should become “purposefully opportunistic.”
What does all this mean in the context of implementing technologies? Based on my study of Drucker during my MBA, and my over 20 years in IT (principally information management and related domains), I interpret it as this:
The strategy required to achieve your business objectives is more important than the technologies you use as enablers for that strategy.
Seems simple enough and yet it often gets lost, especially when the “next big thing” in technology comes along. Whether it is the practical application of AI, the use of robotic processing automation (RPA), or turning business analysts into citizen developers with no code tools, there is no single technology silver bullet. The advent of a new, hyped, seemingly popular technology requires the use of Drucker's strategic analytical framework: how can you make this technology work for you by enabling your business strategy?
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TLAs, Strategy and Technologies
Three letter acronyms (TLAs) are specifically what got me thinking about this subject again.
There's been a lot of talk in the legal tech space recently about the popularity and prevalence of a particular TLA: CLM. In this context, CLM is contract lifecycle management. The recent Corporate Legal Operations Consortium (CLOC) conference spurred on a number of discussions on Twitter about how CLM is such a hot market. And yet at the conference, very few in the audience have had any success in deploying a CLM platform or gaining good adoption of their preferred technology.
Which brings us full circle. Because when people are talking about CLM, what they really mean is “a CLM Platform” or “CLM software.” They aren't thinking about the business strategy of managing contracts through a full lifecycle. If you think of CLM as a strategy and then pick the technologies that enable your contract-centric business processes, perhaps that process of applying the analytical framework Drucker suggests and figuring out the resources required before jumping into a technology purchase might help you achieve the goals with respect to managing contracts.
This situation reminds me of where we were in the early 2000s with enterprise content management (ECM). Plenty of vendors wanted you to believe that ECM was all about the mythical one platform to rule them all, a single enterprise content management system underpinning all your content-centric business processes. I was lucky enough to be involved in a huge project on a greenfield site where we did implement a single platform, but such opportunities were few and far between.
When I moved to Canada and went to work at a bank as an internal strategy consultant with special responsibilities for ECM, I found the bank was running nearly every major ECM platform available: IBM FileNet, OpenText LiveLink, EMC Documentum, plus lots of SharePoint, iManage and other platforms. I had been blogging about this reality for some years before taking the role — that enterprise content management should be taken seriously as a strategy! ECM was not boiled down to a procurement decision for a single technology platform, it was instead a set of strategies for managing terabytes of information in the form of many and varied types of unstructured content across the entire organization. It acknowledged there was no “one size fits all” strategy and certainly no “one ring to rule them all” technology platform. Instead, it focused on the business processes and using the right tool for the right job to create back-office efficiencies and business value.
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What’s Old Is New Again?
So when I see the amount of investment pouring into the “hot” CLM software market, I reflect on the whole ECM story, and wonder if what is old is new again, just in a different industry or business context. Major industry analyst Gartner already breaks up contract management into a series of use cases in their CLM Magic Quadrant and you can see that vendors that score well for procurement-focused use cases don’t necessarily score well for legal-centric ones. Perhaps this means it's time for business leaders, their analysts and consultants to take ownership of the acronym, and make contract lifecycle management a strategy, within which implementation of technology tools as enablers can be purposefully opportunistic, as Drucker would say.
Gartner killed off the term ECM in 2017, replacing it with Content Services. Guess what? It just killed off the Content Services Magic Quadrant, because it sees the market as very mature. So how long until CLM meets the chopping block?
Might we be approaching the point of “CLM is dead ... Long live Contract Management strategies”?