Scaleablity: strength or weakness?

One of my current projects is the consolidation of a diverse collections of legacy “systems” into one end-to-end integrated business system. Why are we doing it? Efficiency.  The organisation can streamline its operations and free staff to concentrate on the higher value work they never get to do at the moment (because they are doing things to join up the current systems manually.)  Scalability will be a strength for this system.

The United Kingdom tax office (HMRC – Her Majesty’s Revenue and Customs)  have also floated some options for scalability this week. One of the most dramatic is that HMRC become the country’s payroll provider.  Every company simply hands over payroll to HMRC and they calculate the tax and any other deductions the employee has to make, the rest HMRC pays direct to the employee. The advantage for the state is obvious: transparency of income and treasury flexibility.  If it works, there may be some advantages for the employees of large companies or those with more than one employer: they don’t have to be messenger between tax man and the payroll department(s).  The multinational companies may find this a nightmare of administration, especially if they often move people across national boarders (swapping between HMRC payroll and in-house payroll). For the many thousand small businesses and self-employed people, such a large player is unlikely to be as responsive as themselves or their accountant.  If HMRC’s recent problems with computer system projects are repeated it will be a disaster.  While the big companies can help employees get things sorted out as a group, there is no similar support or protection for the many thousand who grow the economy through their small businesses.  Payroll done this way could easily become a barrier to startups and flexible workforces.  This level of scalability doesn’t work because, despite the size of the undertaking, the system is not contained and actually adds complexity not reduces it.

I admire HMRC willingness to entertain radical solutions to everyday problems. I’m not convinced there is enough understand of the economic system they are proposing to change: it is beyond a simplified model of the economy on their computer or on restaurant napkins.

This proposal has made me reconsider how we make sure that the scalable solution I’m looking for has all the benefits and minimal complexity for the customer.  That means the new system has to be customer focused.  The whole organisation’s approach will be changed by this apparently simple system change. The CEO, board and I know that but our customers and users may not have realised the implications.  That is a big part of our communication plan, which has already quietly started.

My conclusion remains that scalability is a strength but I must add a cautionary tale : 

There was once a world where the ants (many smaller local businesses) , bees (hives of activity from international businesses) and butterflies (portfolio  and migrant workers) farmed fish-food (money) that all the fish (bigger companies) in the pond enjoyed. But the gardeners (the government) decided they wanted a whale (of a system) to swim with the big fish and make sure the food was fairly shared and went where the gardeners wanted it. The gardeners forgot that ants can drown in the volume of water needed to float a whale and that bees and butterflies will fly away if they can’t find places to land. They remembered all this just before the whale arrived and they had to decide if they should sent the whale back or risk flooding the fish-food farms…

The ending to this story I will leave to HMRC.


About 3triangles
Helping organisations make change happen in 3 key areas: strategic change, deliver tactical impacts, efficient and effective processes. All blog content (c) 2009 - 2012 Carol Long and Three Triangles Performance Ltd

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