The following are the drivers of cost in building taxonomies:
1. Strategic executive top down approach
The strategic executive top down approach requires a very experienced executive level facilitator (and therefore expensive facilitator) for the upper levels of hierarchy development working closely with client executives and senior managers and guiding them to the optimum solution – cost cutting at this level compromises the long term strategic outcome of the investment – the right facilitator can add HUGE value for decades after they have completed their assignment.
2. More complex and more abstract than it seems
While the final deliverable seems simple and obvious the process of getting there takes far more time than one would expect – it is only finished when all executives and managers can look at the product and say “yes, that is my business”.
3. Facilitator must learn the business
During the first few iterations the facilitator is learning about the business at quite an intense and intimate level of detail with the result that the process is slower than one might expect.
4. Client personnel must learn the approach
During these same interactions executives and managers are gaining a practical understanding of the application of taxonomies to their business and frequently are understanding taxonomies in depth for the first time. This frequently causes their thinking to evolve drastically in the first few iterations with the result that two or three re-starts are quite common.
5. Limitations on availability of senior client personnel
Because it is vital to get all the appropriate executives and managers in the room for specific sessions it is seldom possible to schedule sessions of more than 4 to 5 hours although full day sessions are generally more time efficient from a facilitator cost point of view – this can result in reduced facilitator efficiency and increased costs.
6. Constraints on workshop frequency
For the same reason it is difficult to hold more than 2 or 3 sessions a week which is optimum from a technical progress perspective – this may necessitate shorter early morning or late afternoon or evening sessions in order to keep things moving forward within the constraints of executives and managers dairies – this can result in reduced facilitator efficiency and increased costs.
7. Absence of key personnel generates rework
Trying to force progress by running sessions without all the appropriate people in the room frequently results in time consuming rework and frustration all round at subsequent sessions where the missing person or persons need to bring their component – slower is faster is frequently the harsh reality.
8. Need for continuity and frequent sessions
In addition to the above it is vital that sessions progress at relatively closely spaced intervals – at least one and preferably two sessions a week. Where there are gaps of several weeks both the business team and the facilitator lose the thread of the logic that is unfolding which results in wasted time as people get back up to speed and pick up the threads of previous sessions. A gap of two or more weeks can result in as much as an hour or even more being lost at the start of a working session as people pick up the threads of the previous session.
This in turn can result in unintentional tangential thinking that requires loop backs and rework and further time loss and increased costs – intervals of no more than a week should be scheduled as far as possible and allowance made for increased costs where longer intervals are unavoidable.
9. Understanding of hierarchies takes time
The logic of the hierarchy only becomes fully apparent when the hierarchy has been coded and the hierarchy can be collapsed using the codes. Coding requires considerable behind the scenes cleaning of the hierarchy and can often result in a partial or complete recode being required.
This can give rise to considerable low visibility time and budget impact. The longer the time intervals between working sessions, the more not all people are present in sessions, etc the more iterations of restructuring are required and therefore the more iterations of re-coding are required – the composite effect of these factors can drive considerable increases in cost for no visible benefit.
10. All drive costs – tight management is essential
All the above factors drive costs. Some are unavoidable while others can be curtailed in the event of close cooperation and time management by the client team and facilitator guided by the project manager.
The cost of a worst case scenario in terms of time efficiency can easily run to two or three times the cost of a best case well managed scenario.
Since so many of these cost factors are driven by client specific considerations it is only practical to work on a fixed fee basis where there is very strict time management on both sides which must include willingness by both parties to work overtime at any point where unexpected complexity is slowing progress
11. Master data configuration
Once all the above taxonomy development stages are complete there is still considerable work required in terms of table specific configuration, particularly in the case of items such as product catalogues where potentially dozens or even hundreds of fields may need to be carefully populated for thousands of records. The use of taxonomy based software to facilitate this process is strongly recommended. The precision of the use of the ERP and related software will ride on the level of precision of the configuration down to the last product or material record.
12. Reports, models, etc – the Analytical Suite
Having created highly structured intelligent data™ all we have done is laid the foundation.
It is then necessary to create a rich variety of reports and models in order to harvest the value that is now embedded in the data – this should be done first in the Data Warehouse under almost all circumstances.
In the Financial General Ledger domain we have recently specified and commenced development of the JAR&A Analytical Financial Suite™ which is a comprehensive range of reporting and analytical tools and models that can be rapidly connected to data built to our standards in order to deliver a rich yield of “touch of a button” management information tools and resources – refer separate literature.
A simple confidentiality and non-disclosure agreement which you can tailor and elaborate on as you see fit and which may vary depending on your legal jurisdiction and your attorney. I recommend that this initial document is kept simple as you want ALL persons attending the initial tender briefings to sign this
You would possibly have a much more comprehensive agreement for your short list bidders and possibly more comprehensive still for your final choice although I personally hold that very detailed documents of this sort tend to be excessive
Click here to send us an email subscribing to our free newsletter -- all articles posted by James Robertson will be emailed to you
Business Systems NOT delivering?
Call the Business Systems Specialist
Dr James A Robertson -- has been involved in the effective application of Business Information Systems, including but NOT limited to ERP, since 1987 and in the profitable and effective use of computers in Business since 1981.
Drawing on a diversity of experience, including formal military training in Quick Attack techniques at the Regimental Commander level, Dr Robertson has developed highly effective methods of investigating any sub-optimal Business Information Systems situation -- be it an established system or a stalled project or any other source of Executive frustration -- quickly and concisely diagnosing the root cause of the problem and prescribing concise practical actions that Business Executives can effectively act on see the Pulse Measurement page and also the Sample Reports page for redacted real reports.
He has also developed highly effective methods of strategically enriching systems to unlock the full potential of existing investments, see the Precision Configuration page and couples this to architecting small pieces of clever software that harness the full potential of your investment, see the Software page.
If you are having problems with your systems, your project or your IT Department, call The Business Systems Specialist
Business System Failure is RIFE -- we offer insight into why this happens AND WHAT is required to prevent it.
Failure is at epidemic levels with massive damage done to client companies -- if you are NOT aware of the extent of the problem please visit the About Failure page for a catalog of major failures running to billions of Pounds and Dollars.
All evidence indicates that the established players do NOT know how to deliver stable, reliable high value solutions that WORK.
There HAS to be a better way!
This website provides information relating to that way with a large collection of white papers, presentations, standards documents, etc that you can use to start bringing the situation under control
We also offer high level advisory services with regard to the application of the principles advocated on this website
We offer an ENGINEERING APPROACH to addressing these issues
By Engineering I mean the formal, structured, highly disciplined, highly systematic, highly practical approach that consistently delivers results in ALL areas of human endeavor where formally trained and certified engineers are the ONLY practitioners permitted to operate -- think large buildings, factories, motor vehicles, aircraft -- highly complex systems that work at a level that we take it for granted that they WILL work and where failure is all but unthinkable and, when it happens, attracts immediate public attention and rigorous investigation directed at ensuring that such failures are prevented in the future -- in fact, everything that the management consulting industry that implements complex software systems is NOT
This approach is discussed further on the Engineering Approach page.
In 2003 I undertook an in-depth analysis of all the information and experience that I had gathered with regard to the factors giving rise to Business Information System failure including ERP and general IT and classified this information into a number of categories including "The Factors Causing Failure" and "The Critical Factors for Success" based on this I developed a two day Course "The Critical Factors for Information Technology Investment Success" which is still offered today.
Based on this I wrote the book of the same name, which is available in electronic form here for download:
James has a very detailed profile on LinkedIn should you require further information about him.
You can also connect with him on LinkedIn at http://www.linkedin.com/in/DrJamesARobertsonERPDoctor
James has an open networking profile -- click on "Connect" and use email address James@LinkedIn-at-JARA.com.
You can contact us on
LinkedIn at http://www.linkedin.com/in/drjamesarobertsonerpdoctor
Facebook at https://www.facebook.com/james.a.robertson.393
Mobile: +44 (0) 776-862-2875
Landline: +44 (0) 207-059-0007
Fax: +44 (0) 844 774 4580
There is a large body of white papers, articles and other content produced by Dr James Robertson available on this website
Please click here to visit the detailed listing of articles
About Dr James A Robertson PrEng -- The Business Systems Doctor -- and Other Topics
Catalogue of Major Business Information System Failures
About the Engineering Approach
James Robertson's Value Add
Attributes of a HIGH VALUE solution
Recognizing Business System Failure
The Critical Human Foundation
Old Software IS Viable
From South Africa
Competencies of Dr James A Robertson PrEng
About Professor Malcolm McDonald
Table of Contents
About my relationship with the Almighty Creator, Yah the Eternally Self-Existing
Comments relating to the Business Systems Industry and other topics
Testimonials and other positive material regarding James Robertson
List of Articles
Achieving High Value Business Information System outcomes
Executive Custody -- What is it and HOW do you get it?
The REAL Issues in Integrated Business Information System Success
Part 1: Introduction
Part 2 -- Mythology and Lack of Executive Custody
Part 3 – Strategic Alignment and Precision Configuration
Why your ERP is NOT delivering and HOW to FIX it
IT Project Management
CEO Anthony Lee Comments on his experience of the Pulse Measurement
No Charge Guarantee on the Pulse Measurement Service
Examples of Pulse Measurement Outcomes
Critical questions regarding the Pulse Measurement™
The Pulse Measurement Workflow
The Critical Factors for Business System (ERP+) Investment Success in the Pulse Measurement
Indicative Pulse Measurement Durations
What is a JAR&A Pulse Measurement?
Survival of the fittest – why it makes sense to measure the pulse of your business
Examples of Pulse Measurement Outcomes over 24 years
Sample Pulse Measurement Reports
Strategic Essence: The Missing Link in Business Information Systems
Strategic Essence: Overview
Strategic Essence: Part 1 -- Strategy Defined
Strategic Essence: Part 2 -- Differentiation
Strategic Essence: Part 3 -- The Essence IS Different
Strategic Essence: Part 4 -- The Essence should be the Point of Departure
Strategic Essence: Part 5 -- Discovering Strategic Essence
Strategy -- the Essence of the Business: What is it and how do you develop actionable strategic plans?
Simple Steps to Increase the Strategic Value of your ERP Investment
Free Strategic Snapshot Toolset and Manual
A strategy focused planning system beyond traditional budgeting
Tough IT and ERP Procurement and Contracting that Works
Robust Business Systems Procurement
Part 1 -- Introduction
Part 2 -- Bill of Services, Laboratory, Go-live Certificate, etc
Part 3 -- Executive Engagement, Bid Compliance, Adjudication and other matters
Guidance and Advisory Services
The Art of Project Leadership
Why Regular Communication with the CEO is Vital
The Business Simulation Laboratory
Precision Configuration and Strategic Business Information Architecture
Precision Configuration based on Strategic Engineered Precision Taxonomies
The JAR&A Cubic Business Model
Highly Structured Strategic Chart of Accounts -- a Vital Element of your Corporate Information Arsenal
The Product Catalogue -- an Essential Element of any Precision Configuration
Attributes -- answers to the questions you have NOT yet thought to ask
Case Studies of Notably Successful Projects with high value Precision Configuration
092 Doing things differently and better -- ASCO Case Study 2-- BPM Summit 2013
088 Strategic ERP Invesment -- ASCO Case Study -- Service Management Conference and Exhibition Africa
026 Information Architecture and Design of FIS for Rennies Group -- Financial Information Systems Conf
018 CRM Risk Control: Designing and Implementing an Integrated Risk Mgmt Sys -- Integrated Risk Mgmt Conf
011 V3 Consulting Eng: Benefits of MIS to Professional Practice -- SAICE 15th Ann Conf on Computers in Civil Eng
Strategically Enriching your Business Information Systems
Part 2 -- Principles of Data Engineering
Part 3 -- Steps in applying these recommendations
Simple Steps to increase the strategic information value yield from your Business Systems Investment
The Full JAR&A Taxonomy Manual
Part 1: Introduction, Problem Statement, Definitions and Examples
Part 2: Why Use JAR&A, Required Knowledge and Experience, Cubic Business Model and Chart of Accounts and Taxonomy Software
Part 3: How to do it, Case Studies and White Papers and other References
Example General Ledger Manual
Business Process -- Irrelevant, Distracting and Dangerous
The RIGHT Approach
Custom Strategic Software Design and Oversight of Construction
Standards for Custom Software Specification
What IS Software?
Critical Factors for I.T. Success
A Moral and Ethical Dilemma -- Systems that Fail
Case Studies examining Business Information System failures
The BBC Digital Media Initiative Debacle
The Bridgestone -- IBM Conflict
Speaking and Training
Showcase of Conference Presentations
Most Viewed Presentations
Briefings and Seminars
Why your ERP/BIS is NOT delivering and HOW to FIX it
ERP and IT Procurement that Delivers Results
The Critical Factors for IT and ERP Investment Success
Conferences and Public Presentations
Conferences 80 to 99 -- 2009 to Present
Conferences 60 to 79 -- 2005 to 2009
Conferences 40 to 59 -- 1996 to 2005
Conferences 20 to 39 -- 1994 to 1996
Conferences 01 to 19 -- 1989 to 1994
On-Line Seminars (Webinars)
Webinar on Preparing and Presenting Webinars
Contacting James A Robertson and Associates Limited