Are Google, Facebook et Al. the new ERPs ?

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Until not so far ago, when we talked about structuring technologies for businesses it was clear that it was about the ERP. Like it or not, the ERP was (and is still) the backbone of any business, the mandatory channel for their nerve impulse, orders and decisions the brain sends to the body.

There was no other system businesses were that dependant on, and most of all not on the client/customer side. Until the 2000s technology was absent on the customer side. Of course businesses used CRM to manage the customer relationship but the use of the technology was internal. They was nearly to technology enabled interaction between businesses and their customers, contrary to what was happening inside. Of course there was the purchase/invoice side but this field was rather in the ERP field.

Web giants allowed businesses to industrialize marking, communication and customer relationship

Then came the web. Businesses spent a long time exploring this new media before they really get its potential and take it seriously. Then came the Googles, Facebooks et al. that, in some way, brought a kind of rationality in what was a little bit messy. All for a sudden they got

• touchpoints with their customers, points where audience gathers

• players centralizing the access to these touchpoints

• an industrialized way to get in touch with customers through these touchpoints

• standardized processes

Google, Facebook and a couple of web giants brought structure and an industrial approach to marketing and customer relationship. There’s a way to do things, businesses check the boxes, follow the process, they know what they buy, the rules and the result they may expect.

If we remember that 15 years ago it was only about print, radio and tv, we must admit that a quantum leap has happened. It’s good to be aware of that.

It’s obvious that this industrialization, this standardization of models applied to marketing, customer relationship and communication looks quite like what happened to resources, supply and financial management a long time ago with the advent of computing then with ERPs. So it looks like a good thing in terms of simplicity and efficiency.

Will Google and Facebook kill the competitive advantage of their clients ?

But it the computerization of process management had its good sides it also hat its downsides.

In 2004, Nicholas Charr wrote in “Does IT matter” that IT brought very little competitive advantage to businesses. On the one hand all businesses got major productivity and efficiency gains from it. But on the other hand they all used the same softwares to implement the same best practices and processes, with the same settings, the whole being done by the same consultants that have all been trained the same way.

There were, of course, benefits for businesses. But it causes such a normalization that no business was able to build a competitive advantage on IT and ERPs. When everybody uses the same tools in the same way, performance improves but it does not make a difference compared to competitors that are doing exactly the same.

Things may have been different if some have decided to be disruptive, innovative, creative in the way they designed  the processes and rules supported by the technology. But 99% of businesses did not choose that way.

Overnormalizing the customer approach may be a mistake

Today when one searches something in Google he does not get a comprehensive vision of what exists or best results but results “according to Google”. Google decides what we will see first or not and to be at the top of page supposes to comply with Google rules.

Google promotes contents of quality. I dont know if you ever took a minute to wonder :

• if an algorithm can assess the quality of a writing

• who is Google to allow itself the right to say that a content is of quality or not

I can admit that technology can assess if things are well written in terms of syntax. But I’m very skeptic about how legitimate is an algorithm to asses the quality, worthiness and relevance of the substance of a content.

No one writes for an audience but for Google.

Anyway. Google sets the rules and people write accordingly. No one writes for an audience but for Google.

Facebook also decides what contents are allowed or not on its platform, sometimes ending in a kind of very disturbing censorship. Facebook can decide to change the rules overnight, the way content is displayed in the newsfeed, forces everybody to adopt its rules and, logically, everybody follows.

When everyone uses the same technology in the same way, following the same processes and rules, everyone gets the same results. When everyone accepts that a third part unilaterally sets the rules of the game then there’s no room for innovation. Innovation will come from the platforms and your competitors will benefit from it as well as you do. Don’t look for any competitive advantage here.

In short the web giants provide businesses with awesome technology allowing them to industrialize and rationalize their approaches on a field that used to be scattered and messy. But it happens at the price of an over-normalization of practices and a kind of sovereignty abandonment that may kill any possibility of differentiation.

Photo credit: ERP by Melpomene via Shutterstock