Dynamics Matters Podcast Ep 78:

The shape of Microsoft technology in 2023

With special guest David Little, Managing Director, HSO

✔ Why the focus is on extending value

✔ Why growth should not be the goal of organisations

✔ What tech intensity is and what it means for your organisation

Transcript

Welcome to episode 78 of the HSO Dynamics matters podcast.

Your regular sonic dive into the world of Microsoft technology related matters and much more besides.

I’m your host, Michael Lonnon.

Has your 2023 started with a bang? It’s only just dawned on me, while recording this, that it’s February already.

As I like to do at the beginning of every year, I wanted to grab HSO Managing Director, David little, to find out from him what he thinks 2023 has in store from a Microsoft and technology adoption perspective.

And, as always, David provides some revealing insights into the year end, whilst sprinkling our chat throughout with gold.

So, grab a brew, sit back, relax, and enjoy the show.

Michael Lonnon
Reflective or impulsive?

David Little
So that's quite an interesting one. I think you have to be both; I don't think you can choose between those two and you need to trust your instinct.

Michael Lonnon
Would you lead more on instinct as opposed to consideration? Usually, your instinct is normally right, in most cases.

David Little
I think that's what I'm saying I don’t think those are opposites. So, some people talk about instinct rather than the numbers or information, which I think is definitely true. I definitely need to work in on that basis.

Michael Lonnon
It's an interesting perspective. If you asked all the data people, they would say reflective individuals?

David Little
I think there's a lot of books of leadership and they say you, you should definitely not be overpowered by the numbers. The numbers have got to be there to back up to what you think but your instinct is, by far and away the most powerful.

Michael Lonnon
Whenever I do any campaigns, and we think about any ideas generally, the first idea if I come up with five ideas, the first one is pretty much always the right one or the best one.

David Little
I genuinely can’t answer that one and give a preference, because sometimes it's like you immediately know and other times you feel people are moving too quickly and I'll say stop, we need to stop and reflect on this, because it doesn't feel right. You could argue that that's, you know, it's the same thing. It's coming from the same place. Your instinct is saying stop immediately but let's just pause and think and it's not necessarily to gather more information, it's to, is to talk more.

Michael Lonnon
A tough year ahead or much the same?

David Little
A bit of both.

Michael Lonnon
What do you think is going to be the big difference between 2023 and 2022, in terms of overall not just HSO technology and that sort of thing but the world?

David Little
I get a sense that there was a massive build-up of demand for lots of reasons and COVID accelerated lots of things, which then happen very quickly and that's what we got, I think across in our industry, but also across the world. We saw that happening everywhere and I think we're now in another phase that comes after that. I think there's always, phases that have the cover ups and downs and natural corrections and this feels like a bit of a correction.

Michael Lonnon
Let’s go back just a second then; how was 2022 Generally for HSO as an organisation?

David Little
It was absolutely massive, and I think that was potentially a correction or maybe a series of corrections, after COVID and for various other reasons. Our growth was enormous, and we also took advantage of, or took the opportunity to make some big investment decisions as well. So, the expression that we've sometimes used is fixing the roof while the sun is shining. So, making sure that we invest in the future, and you know, don't just bank all the gains of that growth. But I think a number of things seem to converge. Meaning that HSO did incredibly well. Some of those were long term decisions but I think we're also sensible enough to know that it was environmental as well, we can't just pat ourselves on the back, because if we do, then we're going to get complacent about the future. So we need to think very carefully, what were the reasons why we had that upsurge in demand and such a good year and why will it not happen in the year ahead? Not, why will it continue but the opposite?

Michael Lonnon
That's a great piece of leadership advice. So, what are David littles ambitions for 2023?

David Little
Well, I think that from a business point of view, I don't think it is going to be very different year to year because all you're thinking about and this relates to the previous point, is how you can get through it. Given the changing environment, if you think it's going to be the same, it's not. So, it could be managing incredible growth like we had last year. At the same time, it's not just managing that growth, I mentioned making the investment decisions. So, what's the year ahead going to be? Well, we don't know but it's going to be a different set of challenges. It's making sure that you retain a balanced approach through those challenges. So, in other words, how do we continue to invest, even if the market is turning down, for example. So, I think in a way, it's just can we continue to move forward, retain the culture of the business, retain the strength of the business, make long term decisions in a very different environment and obviously, we succeeded in doing those things in a very different environment this year. So, I think that's always going to be the ambition is to keep it going and address the challenges. But not just to address them, but to move forward and always lay foundations and then there's always personal ambitions, which are, in some ways, probably a little bit easier to articulate.

Michael Lonnon
Now, we heard a lot towards particularly towards the end of 2022, about cost-of-living crisis, and everyone knows it's just to survive a manage household these days is going to be far more challenging, particularly 2023. What sort of message is Microsoft giving in terms of how technology can help remediate some of the stresses that are likely to be felt in 2023?

David Little
So I think the expression which I like and always come back to is when Sachi Nadella Microsoft talks about tech intensity, and I think it's making sure that technology, you look at technology and every single aspect of your, your business, and I think, traditionally up until a few years ago, people have just thought about continuing to optimise the same processes and make them better and better and I think notes how do we make technology ubiquitous, in the business, look at every single area where technology can help and I think that's, what it comes down to and specifically what that means looking at technology to help with managing with people, as well as customers and supply chains and, and so on, how can it help with product development, so how can technology help in the areas where it's not been used so much in the past and I think that's the, that's the big opportunity for businesses.

Michael Lonnon
They talk a lot about making more of the investments in technology that organisations have already done but, thinking about Microsoft technology, do you think there's going to be a bit of a push on that as well to make sure that if organisations have spent money on their ERP platforms, how they then can use things, tools like Power platform to create agile applications, rather than going out to market to spend big again on something else, do you think there's going to be a little bit more of a push that way around as well?

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David Little
Yeah, and I think the other Microsoft expression is do more with less. I definitely agree with that. I think that tech spending has been too much in relation to the return that it's given. There's always been a differentiation between the money that you need to spend on the platform, which is very expensive, and then the money that you spend to optimise, but I think that balance is definitely changing. So, I think there has to be quicker return, much better cost benefit cases than there has been in the past and I think things like power platform, low code, are good examples of that. So, people would put in an ERP system, but then there would be hundreds of applications and SharePoint sites and all sorts of things that sit around it, they would just get left at the side and again, I think that an example of getting a quicker return is also another example of that tech intensity to say, look, actually, how do we use technology to clean up all these other areas that we've considered to be to be outside of the normal tech realm. The other expression, which people are talking about more and more as Shadow IT, which is the IT, that isn't the official ERP system, it's the systems that people have created themselves. It's the spreadsheets, it's the documents, which departments have created, which makes things very inefficient, and actually quite high risk as well. So, as data protection is becoming a bigger and bigger issue, people are looking at, you know, getting rid of shadow IT and putting a proper structure behind those less formal systems. Again, things like power block platform have got a massive role to play in that.

Michael Lonnon
That makes a lot of sense. I have three questions; I want to get a real quick take from you. Because I think they will test your speed of thought. So, in 12 months’ time or two years’ time when we come to speak again, what type of organisation will HSO have become?

David Little
More diversified I would say. We have to make rapid progress towards becoming a proper end to end systems integrator and operating in more industries than we're in now, but to emphasise that operating more industries also means operating well in those industries. So having the same level of focus and dedication that we've got in our existing industries.

Michael Lonnon
What do you think makes a good company? Is it revenue? Profit? Shareholder value? The focus on sustainability, wider community investment, etc …? What does a good company look like?

David Little
You might remember that we said growth is not a goal. So it's definitely not about the numbers. It's, about having an organisation, and I think organisation is probably an expression that you can stop and think about it, it can be meaningless, but I think it means the way that you organise yourself and the people that you have in that business, that builds, progression and investment and wanting to do things differently is the fabric of that business. So, all the best businesses think that way, they’re thinking, how do we improve, how do we develop new products, how do we become better at what we deliver, and you build that into a sustainable organisation that's always moving forward and then all the evidence is that the market then will find you and revenue will find you and growth will find you. If you develop the right products, then growth will follow.

Michael Lonnon
Finally, if you had one piece of advice for a senior leader like yourself in any organisation looking to technologies to help them fulfil their own ambitions, what might it be?

David Little
So, it's definitely not about our technology or our services or Microsoft services to achieve their ambition. That that probably comes back to the point about value for money. So, another use of the word intensity, tech intensity, I think is what businesses should be looking to achieve. I think as they go into a project, I think there's the same mindset, it should be project intensity as well. So, what that means is having a really relentless focus on getting the value from that project, I think far too many projects are cumbersome, to loosely managed, there needs to be intensity to drive towards a goal, and then build on that as a platform. I think the best organisations and the best projects will try and get something done with intensity quickly, and then move on to the next thing and then just keep doing that and then make that into a habit.

Summary
David believes that 2023 will see a greater focus from Microsoft, and the organisations using its technology, on finding ways to extract more use and value from it.

There will likely be an edging away from large, complex, and expensive projects, fraught with danger, to small rapid scale up projects that deliver singular points of value.

David also has a really interesting take on business – one that underpins HSO. And it’s not to focus on growth. But instead to focus on improving the way you deliver value to customers, by adopting the best processes, and people. By doing so, growth naturally will find you.

Sage advice for any organisation leader.

Thanks for listening, until next time, take care of yourselves.

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