The Not-So Digital Economy!

The economy is not digital. Humans ARE the economy!Some discoveries remain current long after their time. In 1776, Adam Smith was first to propose that ‘human economic actors’ drive the economy. His ‘invisible hand’ regulates the economy by demand and supply created by human needs or desires without a governing body. The larger a business the more it represents itself such a dynamic economy in which economic actors continuously take decisions regarding either production (IT) or consumption (process). That decision process requires information about consumer needs, production cost, market prices, and data that govern the business cycle. Data are turned to information by meta-data; human experience turns this information into decision knowledge, and decision patterns are remembered as process know-how.

“Knowledge is information combined with experience, context, interpretation, and reflection. It is a high-value form of information that is ready to apply to decisions and actions.” (Davenport, T. – 1998)

Knowledge always has a personal quality, as it is gained through experience and stored in a person’s mind. The problem of creating IT-encoded processes is to somehow extract this unique experience from the human brain. There simply is no abstract, non-human business knowledge but there is real-world business content that users interact with. Communication content and its related data elements are the link to the decision patterns that make up the economic processes that we need to support with IT. Content and process management software must not just store and retrieve content or force users into processes but rather focus on learning from user decision-making, using process-relevant data from data-warehouses. The (SOA or not) interfaces to background or backbone IT applications are not the core problem to be solved but just a technological sideline.

We need to ask: Why does IT try to solve a simple problem (performing a business activity) in numerous fragmented and rigid ways with completely unnecessary complexity and expense? ECM, CRM, BPM, as well as business intelligence and collaboration tools resemble a tested-to-death, rigidly frozen landscape of data-structures, interfaces, processes, content and user-frontends in Java and XML. Like in free markets, rigid business rules or process models will rather damage than improve the corporate economy. Proper studies would show that the return on investment argumentation for BPM and ECM projects with or without SOA claim unfounded manpower reduction, process improvement and cost saving values that are never realized. These potential savings still have to be offset against the loss of service quality that is caused by rigid processes that do not fulfill current needs and the substantial, mostly ignored cost of process adaptation and maintenance. This is why my work at ISIS Papyrus is about solutions for a complex adaptive world.

I am the founder and Chief Technology Officer of ISIS Papyrus Software, a medium size software company specializing in communications and process management. I wrote several books and hold a number of patents. My quest is to bring common sense to IT, mostly by focusing in human quality issues rather than cost saving, outsourcing and automation. I am also Chief Architect at VIPorbit software which provides mobile relationship management.

Posted in Executives

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Max J. Pucher
© 2007-16
by Max J. Pucher. All rights reserved.
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