Joel Parsons hurried down the hall to the monthly executive committee meeting doing a mental checklist of all the things he was responsible for: sales analysis-check; marketing stats-check; quarterly and YTD financials-check; operating statistics-check; trends in each of these areas-check. Parsons was right hand man to the President of Continental Furniture International (CFI) and his primary job was to collect, analyze, and interpret any and all information the president needed to run the company. Joel had joined CFI a year ago from a similar job as manager of Data Analysis, assisting the vice president of Operations at UPS, where he had been involved in implementing some of the world's most sophisticated delivery scheduling and package flow technology. "I could use a bright young MBA here with me to shake things up at CFI," the president, Alan Chambers, had told him during his interview. "We need better business intelligence if we're going to be better than our competition." "That was a laugh," thought Joel as he took his place beside Chambers and flipped open his laptop. These days his lived on Excel. This company thrived on its spreadsheets and Joel was responsible for digesting everyone else's data and packaging it for the President so he was always up to speed. Sure, they also had computer reports and even a financial "dashboard," thanks to the company's new ERP system, but the business world was changing and these canned reports only scratched the surface of what the president needed to know. The next hour was a typical executive meeting, with each VP reporting on his or her progress and the president grilling them on exactly what was going on. To keep everyone on their toes, he always liked to have a few facts at his fingertips. At this meeting, there seemed to be a theme. "How much do we spend to heat our Andover warehouse?," he inquired of the VP of Operations. "Why are our delivery costs rising so quickly?" "What are we doing to make sure our drivers are following all our safety protocols?" Occasionally, he would turn to Joel to check a fact or a trend, but he had done his homework and wanted everyone to know it. Joel watched the VPs squirm with discomfort as they tried to dig through their own spreadsheets to find the information Alan was demanding. As they moved through the agenda, Joel was happy he wasn't on the hot seat. The last to report was the CIO, Cheryl Drewry. A long-serving executive, Drewry was tough, spoke her mind, and delivered what she promised; it was the reason she'd been around so long. After listening to Cheryl's report on the progress of their major IT projects, Alan paused and all heads looked up expectantly. 3 Smith, H. A., and J. D. McKeen. "Working Smarter at Continental Furniture International." \#1-L10-1-002, Queen's School of Business, February 2005. Reproduced by permission of Queen's University, School of Business, Kingston, Ontario. Working Smarter at Continental Furniture International "I asked you all to clear an extra hour for this meeting for a reason," he stated. "We're doing well as a company but we need to do better. Our ERP system has got us part of the way. We now have good, common processes and some common data and consistent functionality. In short, we've picked all the low-hanging fruit. Now I'm worried about what's next. We can't afford to be complacent. Everyone has an ERP these days-even those guys at WWF. Everyone grinned at the nickname of World Wide Furniture, CFI's archrival for many years. The two companies had seesawed back and forth at the No. 1 and 2 positions in the furniture industry. Right now, CFI was No. 1 and it was Alan's job to keep it that way. Alan continued, "What we now need is a way to work smarter-a way to leverage the information we've got and use it more effectively. There are lots of things that we could do but my first priority is to use information to enable CFI to Go Green!" He paused dramatically, while the VPs took a deep breath wondering what it was going to mean for their divisions. "Cheryl and Ihave discussed this and we feel there is enormous potential to use information, IT systems, and our great people to become more productive, more profitable and to reduce costs, while saving energy. This is truly a win-win for everyone!" The room burst into sustained applause. The idea was a winner to be sure. How could you not like it? But Joel knew the hard work that it took at UPS and he wondered if these guys knew what they were in for. Alan turned the floor over to Cheryl who gave a brief overview of what they were planning. "First, we are going to give each of you a set of data analytics tools so that you can explore our data warehouse yourselves. We want you to start thinking about ways you can use data differently. Second, we are going to establish an energy informatics team, composed of some business and IT people. They are going to examine any and all opportunities for using information to save energy anywhere in our company by working smarter. Third, we want your ideas and support to make this a corporate showcase." Alan stood up. "This is an exciting and very strategic initiative for our company. It's a chance to be both socially and fiscally responsible and to lead in our industry. The energy Informatics function is going to be crucial to its success so I'm personally going to be monitoring our progress by having this team report directly to me, with a dotted line to Cheryl. And fortunately, we've got just the right person to lead it...." He gestured at Joel. "Joel Parsons has several years' experience doing just this type of work at UPS. He helped them implement package flow technology which enabled the company to shave 30 million miles off its daily delivery driving two years' ago. This has saved over 3 million gallons of fuel annually-benefiting both the company and the environment. Take a bow, Joel." Totally dumbfounded, Joel stood up and bowed dramatically and the meeting broke up a minute later, with everyone shaking his hand and congratulating him on his new appointment. Gathering his papers and laptop, he felt a hand on his shoulder. It was Alan. "Sorry for the surprise Joel but this was super secret and I knew you would love a chance at this job. You've been suggesting we improve our analytic capabilities ever since you got here." That was true, but delivering these capabilities was going to be a serious challenge. While he knew what the goal was, getting there was going to be a project of a Section IV IT Portfolio Development and Management nature few companies had tried. It was going to take it all-business smarts, technology, data, people's commitment at every level, and processes. Somehow, they ALL had to tie together effectively to deliver real business and environmental value. "I'll do my very best for you sir," he replied. Give me a few weeks to get my thoughts together and to speak with Cheryl and the other VPs and I'll outline how I suggest we implement this strategy. With a curt nod of his head, and a clap on his back, Alan left the room leaving Joel with a million thoughts swirling in his head. Over the next few weeks, Joel had meetings with every one of the VPs to assess the scope of the opportunities involved, identify issues, concerns and potential obstacles, and to quietly evaluate who was really on board with the Green strategy. In addition, he met individually with the two IT members of his team, who had been hand-picked by Cheryl. She had chosen good people, Joel thought. Susan Liu was a data warehouse specialist. She understood what data the company was already collecting from its various systems, how "clean" it was, and what types of analyses were being done at present. Mario Fortunato was an analyst who had helped implement the company's ERP system, which was now its processing backbone. He was a good choice, thought Joel, because he had an excellent overview of the entire company's operations from suppliers to consumers. Joel had asked Alan to hold off appointing the last business member of the team until he better understood the business expertise that might be needed. In their first team meeting, Joel outlined their mandate as he saw it. "Going green is both a huge opportunity and a huge challenge. So far, we've never used our data and systems to help us use energy more effectively. While we've had some energy-saving initiatives at CFI, these have been entirely initiated by our building maintenance group doing generic things like installing energy-efficient light bulbs and such. What we need first is a 'quick hit' so that everyone in the company can see what we're trying to do and why." Susan jumped in. "We could start with our data centers. There seem to be lots of ways to save energy there." "You're right of course Susan," said Joel. "We should be doing this and I'll make sure that Cheryl has this in her plans. But what we need here is a much more visible way to demonstrate the business value and energy efficiency of this initiative." Mario looked thoughtful. "I'm not sure if this is what you mean but we know how much each of our buildings, offices and warehouses across the continent use in electricity, water, and heating and cooling. Our ERP system gathers this information from the utility bills that are sent to us electronically. Each building is considered a separate unit for billing purposes and has a separate set of metering. Could we run a contest that would post each building's energy usage each month and provide prizes when they reduce their usage relative to their previous three year average?" "That is an absolutely brilliant idea, Mario!" Joel exclaimed. "It's quick-at least I think it is; it's visible; it uses data we already have; and it involves everyone. And best of all, we can run with it while we work on a more comprehensive energy informatics strategy." Joel was right on all counts. Three months later, the team launched the "Great Green Challenge" with an energy utilization dashboard on everyone's desktop as well as on special monitors in the warehouses. This showed each building's utilization of the three main resources and enabled staff to understand their usage not only in comparison to previous years but also by time of day and month. They could also compare their Working Smarter at Continental Furniture International usage against other similar buildings. Each building had a "green committee," which collected employee suggestions and worked with the appropriate people to implement them. Prizes would be awarded in various categories, such as biggest percentage monthly decline in usage, most innovative suggestion, and largest annual cumulative percentage decrease. The team also posted the most effective ideas on its collaboration site so others could see them. Prizes were small-coffee and donuts for all staff, movie passes, and virtual gold stars-but the contest gave the whole company a focus for its efforts to reduce its carbon footprint and its staff clear information about how they could work to save energy. Everyone was motivated by this program and within a few months after the launch, utility bills were reflecting small, but significant declines. Alan even dropped by to congratulate the team on its success. Success gave the team, which had now grown by two new members, further ideas for other energy informatics projects, so Joel called a strategy meeting to help chart out their next move. "What if we were to tap into the computers in our trucks?," asked Menakshi Deena, who had joined them from the Operations Division. "They collect lots of data about everything from seatbelt use to oil pressure to the amount of time spent idling. Since we have thousands of trucks, we could really save a bundle if we could figure out how to use them more efficiently and safely." They hashed the idea around, growing more and more positive about it as they did. "I like it!" Joel said at last. "Let's make Energy Telematics our next major Green team initiative." After running the idea by Alan, who gave it the go-ahead, the team started into the project in earnest. Sue and Menakshi were put in charge of data collection. "We can get over 200 vehicle-related elements from every truck," Sue reported. "If we put a GPS chip in each truck, we can collect data on what the trucks and the drivers are doing at every stop in their route. We can then use this data to optimize all sorts of energy use." "But we're going to need to develop some software to help us analyze and report all this data," said Mario doing some rapid calculations. "There will be literally thousands of data points every day for every truck." It took a lot of work to figure out all the technical details. The company's trucks had a variety of different hardware and software platforms in its various vehicles and daily data collection and standardization routines had to be developed. Then, the team had to develop algorithms to analyze what was collected in order to determine where problems were occurring. Ted Prior, from Logistics, helped design a pilot test with 50 trucks in their Omaha depot, flying out personally to be there when the data receivers were installed. "They work great," he reported Friday afternoon just before flying home. "We only had a few glitches but otherwise, when the trucks pull in at the end of the day, the drivers simply push a transmit button on their dashboards and all the data is transmitted. We're going to be up and running in no time!" Monday morning Joel arrived bright and early to find an urgent voice mail from Alan's EA. "He wants to see you immediately!" said the message. Hurrying up to the executive suite, Joel wondered what the problem could possibly be. Everything was on track and running smoothly as far as he could tell. Alan's face told a different story. "Sit down," he barked when Joel peered in the doorway. "I've just heard that our drivers in Omaha are threatening to strike," he said as Joel took his seat. "They think you're going to use your system to monitor their behavior. What's going on?" "I have no idea sir," Joel stammered. "We've just done a technical pilot." "Well, I've told them out there that the pilot has been suspended indefinitely," Alan said. "Clearly, you haven't been careful about the impressions you're giving so you'd better go back to the drawing board." Back in the team room, Joel called an urgent meeting to explain the situation. "We've done a lot of work to collect this data and it could have a huge impact on our costs, energy efficiency and safety record," he noted. "But we will not get a chance to prove this if we don't figure out how to get the drivers onside. We didn't need to 'sell' the Great Green project, but this hostile reaction suggests that we may have some selling to do with other parts of the organization as well as our truck drivers. Anybody got any other ideas about what could go wrong?" "Well, our front-line operations managers are super busy," said Menakshi. "We'd better be careful how we present this program to them or it could be seen as a lot of extra work." "Our mechanics should be involved as well," said Ted. "They seemed quite interested in the information we could pull off the trucks. They could be quite helpful if we get them involved." "We've got all this great data," said Sue, "but how are we going to get the drivers to act on it? Just collecting this information isn't enough." "We've also got to consider how to roll this project out across the company," said Mario. "If the drivers can get this upset about a simple technical pilot, what are they going to do when they see the information we're planning to collect!" The team fell silent and Joel turned all these thoughts over in his mind. He knew his future at CFI depended on what they did next. They'd barely started this project and it was already in trouble. "Okay," he said. "We've hit a snag so now we've got to find a way to get Energy Telematics back on track. I told Alan we'd work up a plan and, if he likes it, he'll unsuspend the project. Who's got some ideas?" Discussion Questions 1. Why was Joel's team caught off guard by the hostile reaction of the truck drivers to the technical pilot of the Energy Telematics project at the Omaha depot? 2. Why did the "Great Green Challenge" succeed while the Energy Telematics project hit road bumps right out of the gate? What are the lessons learned for Joel and his team? 3. Develop a plan for Joel and his team to get the Energy Telematics project unsuspended. The plan will need details of who, what, when, where, and why. 1. Combined ratio reflects claims and adjustment expenses, commissions, operating expenses and taxes during a defined period as a percentage of net earned premiums for the same period