Charles Drayson

Apr 27 · 5 min read

Recently (unconnected to my Legito role), I have had reason to look at deals with commercial terms that are not ‘standard.’ The variance arose because things have changed over time, and because we try to be agile in how we do business. That’s a good thing, isn’t it?

If we implement systems to manage the back office, should we configure those systems to allow variance? If so, how? Let’s answer the ‘how’ question first because the answer could inform the ‘should we’ question.

Here are some ways we could allow for variance:

• Configure the system to record and track only the highest level details that can be applied universally: for example, we could configure a contract management system to point to a file copy of a customer contract, and leave the reviewer to read it when needed. All customers have contracts, even if they differ.
• Configure the system with many user-defined fields so that each record has a place to summarise critical details, but each item in the data set looks different. This is like having a blank note page to keep track of important items, at the discretion of the person who makes the notes.
• Configure the system to demand consistent details about each item, but allow users to access an ‘Other’ option to note things that don’t fit.

All the methods for managing variance are popular with users, even if we question the wisdom of their preferences. Fewer users will moan that ‘computer says no’ or curse their PCs. The Helpdesk will get fewer calls from frustrated users. Life seems comfortable.

Now move the clock ahead a few months or years to a time when someone needs a report or analysis. It could be something deceptively simply like the need to send out price increase notices to relevant customers. It could be something complex like taking investment from a private equity backer who wants to scrutinise the business. All the variance mechanisms might look cumbersome at best. At worst, the resulting reports might suggest that your system created the illusion of management while it was really recording events that make the organization look out of control.

These are dilemmas faced by Legito consultants when we deploy Legito. Of course, we follow customer instructions. However, if you see multiple projects, you can add value by helping an organization balance rigidity and flexibility.

Here’s an observation that might help: if the variance requirements pertain to a ‘rule’ or detail, examine the rationale for the rule. It’s surprising how often a business rule is applied after one unfortunate incident, and morphs into a clumsy way to prevent the same incident in the future. Implementing new systems like Legito is an opportunity to reconsider the merits of the processes you automate.

There’s often a better way to achieve the desired outcome without burdening a process with low-level details. This is especially true in matters that involve the judgment of human expertise. The system should augment not stifle expertise.

Ideally (even if it evolves), your systems should create a regime where the users intuitively recognize when ‘standard’ is needed to prevent bad things from happening, and flexibility is there to support a user in a world where we cannot always impose our ‘standard’ on other people.

If we implement systems to manage the back office, should we configure those systems to allow variance? If so, how? Let’s answer the ‘how’ question first because the answer could inform the ‘should we’ question.

Here are some ways we could allow for variance:

• Configure the system to record and track only the highest level details that can be applied universally: for example, we could configure a contract management system to point to a file copy of a customer contract, and leave the reviewer to read it when needed. All customers have contracts, even if they differ.
• Configure the system with many user-defined fields so that each record has a place to summarise critical details, but each item in the data set looks different. This is like having a blank note page to keep track of important items, at the discretion of the person who makes the notes.
• Configure the system to demand consistent details about each item, but allow users to access an ‘Other’ option to note things that don’t fit.

All the methods for managing variance are popular with users, even if we question the wisdom of their preferences. Fewer users will moan that ‘computer says no’ or curse their PCs. The Helpdesk will get fewer calls from frustrated users. Life seems comfortable.

Now move the clock ahead a few months or years to a time when someone needs a report or analysis. It could be something deceptively simply like the need to send out price increase notices to relevant customers. It could be something complex like taking investment from a private equity backer who wants to scrutinise the business. All the variance mechanisms might look cumbersome at best. At worst, the resulting reports might suggest that your system created the illusion of management while it was really recording events that make the organization look out of control.

These are dilemmas faced by Legito consultants when we deploy Legito. Of course, we follow customer instructions. However, if you see multiple projects, you can add value by helping an organization balance rigidity and flexibility.

Here’s an observation that might help: if the variance requirements pertain to a ‘rule’ or detail, examine the rationale for the rule. It’s surprising how often a business rule is applied after one unfortunate incident, and morphs into a clumsy way to prevent the same incident in the future. Implementing new systems like Legito is an opportunity to reconsider the merits of the processes you automate.

There’s often a better way to achieve the desired outcome without burdening a process with low-level details. This is especially true in matters that involve the judgment of human expertise. The system should augment not stifle expertise.

Ideally (even if it evolves), your systems should create a regime where the users intuitively recognize when ‘standard’ is needed to prevent bad things from happening, and flexibility is there to support a user in a world where we cannot always impose our ‘standard’ on other people.

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