Suntory

Developing and Integrating Business Strategy

Aligning an organization’s operations with its business strategy is key to ensuring that the organization delivers on its commitments. Suntory was able to successfully align its Corporate Information Systems division with the businesses it served to deliver beyond its customers expectations, ahead of schedule and within budget.

Background
Suntory ,a ¥1,434 billion company, is Japan's leading producer and distributor of alcohol and non-alcohol beverages. Its Corporate Information System division provides scalable information systems to support the 170-plus companies which are part of the Suntory group.

Often, these organizations are looking for information systems to help them to address problems they are facing in running their businesses. As a result of this, the CIS division was facing pressure to deliver more new systems with increased complexity within shorter timeframes.

This new demand put significant constraints on CIS’s resources, and created pressure to continuously add more staff to support the increasing workload. It became very challenging to manage the increased pressure while meeting CIS’s budget goals.

Approach
Some who work within the CIS division read The Goal and Critical Chain, and were looking for a way to apply it to their environment. Contact was made with AGI and an initial TOC introduction leading to a recommendation was done for several senior managers at CIS.

The next step was to provide a TOC overview for all levels of management in the CIS division, including the CIO. This provided the platform to develop a strategy on how to use TOC to address immediate and future constraints of CIS in order to deliver on its short and long-term goals. Although one might think that TOC Project Management would be the solution, using AGI’s TOC Expert^SM Business Assessment process surfaced that the immediate constraint which needed to be addressed was to develop a new business management strategy.

Prior to developing the new business management strategy for the CIS division, there was a need for a proof of concept. The proof of concept was delivered through an actual implementation of a project for one of the corporate customers.

AGI facilitated the development of the business management, functional and marketing strategies for the corporate. It took two days to get to the core problem, and another two days to develop the high level business management strategy. The business management strategy provided the platform to develop the marketing and functional strategies.

The development of the functional strategies, as well as the new business system to support the strategies, was based on the TOC Supply Chain Management solution. Using AGI’s implementation process, it took about one month for the design and development of the new Market Demand-Pull^SM business system for the corporate customer. This new business system provided the platform for CIS to develop the appropriate IS system.

Bottom Line Results
The CIS division was able to deliver the information system ahead of schedule and within the expected budget. Significantly fewer resources were required to support the project due to the avoidance of significant rework. The relationship between the corporate customer and the CIS division was greatly improved, as was the moral of the CIS staff who delivered the project.

Lessons Learned from a CIS Perspective

• The long-term strategy development effort created a lot of clarity for the team to develop a long-term I S strategy (scalable IS systems).
• One cannot take for granted that a corporate customer has a clear roadmap on how to achieve its short- and long-term goals. Any changes they make can have significant ramifications on the sustainability of the information systems.
• It is very difficult to develop long-term IS strategies which meet customer expectations without having visibility and clarity on the customer’s business strategy.
• Going through the functional strategies development and scrutiny, saves a lot of rework (and saves the customer money and time)
• Having consensus on a functional strategy and having clearly defined functional requirements facilitates smooth collaboration between CIS teams and corporate customers.
• Complete consensus and buy-in from the corporate customer on the new business system avoids a lot of rework for CIS. Definition of the functional requirements of new business system provided clear project scope
• CIS was in a better position to size the I S project in terms of budget, resources and duration.

These results were presented TOC World^® 2002. The presentation is available on video (#JMS-13).