Get Smart - Sanjiv Sidhu, founder of i2 Technologies Inc., expresses his opinion about business management - Brief Article

Automotive Manufacturing & Production, August, 2001 by Gary S. Vasilash

"Knowledge champions" are the companies that will achieve dominance in the marketplace Sanjiv Sidhu, Founder and chairman of i2, maintains.

What, you may wonder, is a knowledge champion?

Sidhu says that it is an organization that converts information--about customers, suppliers, and constraints--into actionable knowledge. i2 (Dallas, TX) is a supplier of supply chain software. While many people think about "supply chain" in the context of suppliers, Sidhu emphasizes the importance of forward visibility, with particular emphasis on customers. (He is critical of ERP systems, which he describes as being "rearview mirror" in nature: "It tells you what happened, but doesn't provide you with control of your future.")

Sidhu thinks that the two key aspects of success today are information and speed. He suggests that what needs to happen is that the processing of information--information that is a result of deep visibility into the supply chain and the market--must be made into a process, thereby increasing the speed of turning the information into actionable knowledge--plans that can be executed.

One of the inhibitors that could exist is that of organizational size. He notes that historically, companies, working to achieve cost efficiencies, became large, thinking that the way to go was to benefit from economies of scale. One unanticipated drawback to this approach is that not only did these organizations become large, but also they became complex. Which can inhibit the flow of information. But Sidhu says that the use of information technology tools can provide the advantage that big organizations are seeking (as the information technology will have the effect of breaking down both the silos and the complex mazes that are ordinarily constructed in organizations).

According to Sidhu, companies need three tools in order to work toward becoming knowledge champions:

1. Customer relationship management (CRM)--"not sales force automation."

2. Supply chain management systems--the "backbone" that controls both Fulfillment and pricing.

3. Supplier relationship management.

Note that there are linkages involved in all of these cases (between one's own firm [and there are undoubtedly internal linkages] as well as with suppliers and customers). While this could in itself lead to additional complexity, Sidhu recommends the establishment of a "command and control center" that can help keep things organized.

The Shape of Things to Come
Traditional Firm   Knowledge Champion
Low cost via size  Velocity
React to past      Shape the Future
Mass market push   Individual pull
Independence       Interdependence
Competition        Co-opetition