Use Service Oriented Architecture to become the least-hassle provider and win customers.
Now more than ever due to Covid, concrete producers must rely on technology to navigate the uncertain, changing future. Our own employees, and our customers, are forced to rely on remote communications with the expectation of great service and real-time information. So how do folks steeped in a real-time business making tangible products slow down and take the time required for complicated technology decisions?
We make concrete. It’s a right-now, in-your-face business. If we lose a load to the competition, it will never come back. If one of three dozen potential problems for a perishable, structural product strike, we will eat the cost of the load or worse. The opening stanza from Queen’s “We are the Champions” is a perfect anthem for our industry: “I’ve paid my dues, time after time. I’ve done my sentence but committed no crime.”
Choosing technology is complicated and takes time. The process is completely opposite from our operational world, with one exception. If we make a mistake, we will pay dearly now and in the future.
THE EVOLUTION OF TECH FOR READY-MIX
The concrete industry has vertically specialized needs combined with comparatively low profit margins. Thus, major technology players or consulting firms are not attracted to toiling in our world when they can get more than 10x better returns by working in insurance, medical, banking and others. Historically, a small number of boutique technology firms that did their best to create end-to-end, on-premises software and hardware products.
In the early days of the technology revolution (~1980 – 2000), getting things to work together and keep working together was like playing a three-dimensional chess game. Our industry was happy to outsource that headache to specialized firms.
The end-to-end philosophy has advantages. The notion is that you can get everything you need in one stop, and all the little pieces will work together. Think Alice’s Restaurant, but just don’t expect prime-rib or the menu to change.
SOA OFFERS AN ALTERNATIVE
Starting around 2005, something called Service Oriented Architecture (SOA) started to gain significant traction. Simply put, SOA uses the internet to fetch information from a service (see sidebar). You do this every time you log onto Amazon.com or check the weather. The weather information indeed comes from a server in a data center in some city or country and thus is nicknamed “cloud service.” It’s somewhere out there, but the physical location doesn’t really matter.
In 2008, the first iPhone started rolling out in a big way. Combined with the Cloud, the new smartphone changed everything: There was no going back. It was just a matter of time for on-premises software to be transformed by SOA and the Cloud with anytime, anywhere access.
In fact, SOA and the Cloud have already changed our industry. Traditionally, the lowest cost producer won and bought out the others. Now, the least hassle producer has the advantage, and this is mainly accomplished by customers conducting all business via mobile apps with the bonus of all historical information and analytics only a button press away.
SOA “MANIFESTO” Service Oriented Architecture embodies six key points: - Business value over technical strategy - Strategic goals over project-specific benefits - Intrinsic interoperability over custom integration - Shared services over specific-purpose implementations - Flexibility over optimization - Evolution over perfection
THE PROS AND CONS
Covid is accelerating change. On-premises software providers tightly coupled with hardware can neither change quickly nor exploit the infinite services available via SOA, the Cloud and mobile devices. The clear advantages of SOA are flexibility, evolution, and business value: exactly what we need now to succeed in the Covid workplace, and going forward.
So what’s not to like about SOA? Being on the winning side of evolution takes effort. The days of fire-and-forget purchase decisions for software are over, at least for those who strive to be the least-hassle materials provider. Core business processes must evolve to exploit the new capabilities, like mobile Order Request.
The catch is, you have to invest the time it takes to retrain your organization—and your customers—to take advantage of the benefits. Many lament the loss of a viable one-stop-shop option for technology and the added, unwelcome demands on their time to adjust to the brave new world of SOA and Cloud services.
The concrete industry is undergoing nothing short of a rebirth for core technology. Not only will it take time to get ahead, but it will require ongoing effort for producers to stay ahead. The promise for those who are agile is to become the least-hassle supplier, and hence the winners in the next round of inevitable consolidation. Indeed, the promise of SOA is to empower us with the tools needed to fulfill the prophecy: “We are the champions, my friends. And we’ll keep on fighting ‘til the end.”
Craig Yeack has held leadership positions with both construction materials producers and software providers. He is co-founder of BCMI Corp. (the Bulk Construction Materials Initiative), which is dedicated to reinventing the construction materials business with modern mobile and cloud-based tools. His Tech Talk column—named best column by the Construction Media Alliance in 2018—focuses on concise, actionable ideas to improve financial performance for ready-mix producers. He can be reached at [email protected].