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JAMES MARTIN AND THE GREAT CYBERCORP TRANSITION

In his last and lauded book, The Great Transition, the father of software engineering, James Martin made a great transition of his own: he transformed himself from being a software specialist, an academically inclined programmer who understood and set down how software should be produced, into a management guru, a thinker who understood how companies work and ought to be run. Martin’s new book, Cybercorp, is the younger brother to the Great Transition; smaller, less academic, more anecdotal, and more populist than its predecessor, and oriented towards the deployment of new and fashionable technologies such as the Internet.

Message received?

What is his message? Surprisingly – for this book is in large part a simple exposition of the ideas in the Great Transition – this is not altogether clear. While Cybercorp has a more urgent and visionary tone than many of his previous books (it is claimed that Martin has written more textbooks than anyone else – this latest brings the total to 80), the message is sometimes imprecise, and is diluted by Martin’s frequent forays into related, but not directly relevant, technologies and issues. Martin’s concern is that a genuine technological revolution is underway – maybe even a paradigm shift – and that organizations need to change radically. This much, of course, has been said many times. But he argues that the managers and many of their management gurus have not understood the technological issues involved; and that, conversely, many technologists, and their gurus, are making poor business decisions and are being given bad advice. Companies, he argues, need to replace their chief information systems officers with information architects who bridge business and systems. Modern information technology has completely changed the way that business can and should be organized. And when Martin talks about information technology now, he does not mean computer aided software engineering or corporate client-server systems, technologies which he was once associated with promoting. He means the Internet, intranets, workflow, groupware, intelligent agents, intelligent documents and the like. In fact, Martin freely admits that he helped many companies to build the technological infrastructure which now prevents them from reacting to the new rules. Martin told our sister magazine Computer Business Review that 90% of client- server systems should never have been built. These new technologies, he now argues, have rewritten the rules of business: they enable Davids to beat Goliaths; companies to market products aimed at just one customer; they enable groups to work on projects across companies and across the globe; they enable companies to scale up business around their core competencies, and to scale down their efforts elsewhere; they enable businesses to completely alter their structure, and continue to alter it. Few of the ideas are entirely new. Martin has plunged headlong into a debate where Nicholas Negroponte (the shift from atoms to bits), Michael Porter (Value Chains), Michael Hammer (Business Process Re-engineering), Bill Davidow (The Virtual Corporation) and Don Peppers (One to One Marketing) have all made significant contributions. Martin’s approach, if sometimes academic, is essentially practical, and compared with the brutality of Hammer’s downsizing oriented business process re-engineering, more humanistic. Martin’s core idea is that it is possible for all businesses, both large and small, to accurately identify the ‘value streams’ which run through an organization. A value stream, which bears some resemblance to Porter’s Value Chains and Hammer’s business processes, is a collection of end- to-end activities that has a clear reason for its existence – to deliver a result to a customer or end user. The effectiveness of a value stream can be measured, so that a company can get a clear idea how well it carries out tasks compared with its competitors, and if necessary – and most likely it will be – it can re-invent its value streams to help it become a more effective organization.

Silo and stovepipe

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Computer systems that support value streams need to be flexible, project or process oriented (rather than departmental). The old ‘silo’ and ‘stovepipe’ systems, which were typically departmental or functional (such as ‘accounting’ or ‘manufacturing’), should be replaced by intranet type systems, says Martin. Companies that not only re-organize along value stream lines, but put in place the ‘nervous system’ to support it, are labeled ‘Cybercorps’. These companies, Martin says, are able to act and react with creature-like alertness, becoming fast, flexible and, where necessary, predatory. Their executives are able to see clearly where they should be, and have the confidence to develop more ambitious goals. For many corporate executives, there is a problem with all this. Their organization already exists, it is not structured around value streams, and it has vast investments in legacy systems. Moreover, it has many complex relationships with partners, and well established modes of operation. And many such companies are already making a comfortable profit. Martin is not dismissive of these giants: he praises, for example, Hewlett- Packard Co, whose ability to produce innovative, high quality products quickly gave him some of his ideas. And he notes that IBM Corp was able to distil its $65bn business into just 14 value streams. But he also warns that many firms will face such a difficult re-engineering process that it may be better to create or even break up into smaller ‘Cybercorps’: AT&T Co, now split into three, for example.

Eclectic philosophy

How convincing is all this? With the Internet, intranets and related technologies scarcely two years old (in business terms), is it not too early to build a new management philosophy around their use? The skeptic will certainly find plenty to be wary of in the new Martin philosophy – or at least in his method. His ecleticism, for example, enables him to cite hundreds of companies – both past and present – which have behaved in Cybercorp-like fashion. Virtually all the good ones are praised for Cybercorp-like behavior, while the bad ones serve as cautionary tales. Virtually all examples of innovative uses of technology are praised, along with bold decision making – and rightly so. But there are few examples of unsuccessful uses of technology, or of reckless decision making, and little explanation of what has enabled one company get it right and another wrong. Value streams are not clearly defined, and it is easy to see how there will be liberal interpretations, and conflicting implementations of Martin’s ideas. Readers who want to know how the Internet and the like might change the world and corporate behavior should read this book as a primer. Those who want to change their companies will need to read The Great Transition as well, while remembering not only how many management gurus have got it wrong in the not too distant past, but how often their followers have too.

Cybercorp: the new business revolution, by James Martin. Amacom, $27.95. ISBN 0-08144-0351-4


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CBR Staff Writer

CBR Online legacy content.