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This short video is a great illustration on how IT departments often communicate with other functions within their organizations. Same language, same office, same coffee… yet a world apart…
I was interviewed for an article on CIOZone:
Editor in Chief of Techrepublic, Jason Hiner, recorded a video based on my earlier article on the subject.
It is an interesting experience to hear your ideas vocalized by somebody else. Jason does a superb job of it.
I recently answered this question and then thought it may be worth posting in the blog.
Question: What quality frameworks (ISO, CMMI, ITIL, etc.) have you used in your organization(s), and what pros/cons from each have you found in your experiences?
Answer: There are three key issues that I encounter time after time:
- Faulty belief that a framework (any of these) is a silver bullet for all and any problems. I have seen them applied to correct personality conflicts and dysfunctional leadership. I kid you not!
- Failure to customize. You gotta make it yours to work for you. An IT services organization I know lost customers because third line support found themselves compiling case documentation 80% per cent of their time. Resolved that, but not before some changes at the top.
- Falling in love with your methodology. This is not set-it-and-forget-it deal and you have to test your approach for relevance all the time. Is there a better way to do it? Are our assumptions still valid? A bank I know implemented user account management policies which require faxing (this was in 2008!) of a change form to the support centre. It takes 2-3 weeks to have a user set up. Meanwhile, the business has to put these people to work, so passwords are shared as a matter of standard practice. Formally, they have adopted ITIL. In reality, they are providing poor (if not dangerous to the business) service, having failed to re-evaluate their approach.
In my post about Sun Microsystems from yesterday, I alluded to a decade-long trend of commodization of hardware, pointing out that Sun failed to reposition itself away from the narrow hardware focus.
Today, we are learning that Apple is beefing up its hardware capabilities, looking to start designing its own chips. Today, they are supplied by a third party.
Why would they? Don’t they know that hardware is a commodity?
This is a classic decision point of buy/make or outsource/insource. Here is why the chosen direction makes sense for Apple:
- microprocessors are not the Apple’s final product, so commodization does not matter at all;
- the potentially higher price of a chip will be eclipsed many times over by the revenue generated by new device functionality made possible by precise customization;
- there is a potential for shortening the time to market metric, due to improved communication between the hardware group and other functions (software, sourcing, design, etc);
- reduced “seepage” of ideas and innovation to rivals;
- continuos improvement of chipsets becomes possible because, unlike with vendors, there is no meter running. Tinkering is inherently important to technological innovation;
- and finally, strategically, hardware is important to Apple because all of its products are unique in their own way.
So, based on my experience in consulting on strategic decisions, I think it makes sense for Apple.
Ever since Peter Drucker’s excellent writing, management has been often called upon to spend more time on strategic planning, regularly reviewing and “tweaking” the strategy of the organization, division or department which they lead.
One of the reasons why it does not happen as often as it should: not knowing how to go about running a strategy session, soliciting high quality input and asking the right questions. I have witnessed first hand less than successful efforts to “get strategic”, which put off the instigator from trying again any time soon. “Good intentions…” he grumbles and promptly sinks into the habitual day-to-day routine.
I thought it would be useful to offer a dozen pointers to enable you to develop a viable strategy and keep on top of it. This is merely scratching the surface, but a good start nonetheless.
1. Strategy is the answer to “What?”; tactics – to “How?”
Discussing the distinction with the participants before the strategy session greatly improves the quality of input and helps to move the discussion in the right direction. Strategy should be seen as the framework within which tactical decisions (such as project selection, hiring, vendor management, etc) are made. Take a look at this strategy primer article .
2. Set the priorities straight. I have been to more than one strategic session where participants arrived having not done their homework, read distributed documents or prepared themselves mentally. In all instances, the “crazy day/week/month” at the office was to blame. This won’t do. The onus is on the leader to instill the understanding that nothing is as important as this work and all daily chores must be put aside or delegated. State your expectations explicitly.
3. Despite their wide use, “brainstorming sessions” tend to produce shallow ideas. One of the most inefficient uses of people’s time are those meetings where a bunch of people are brought together and asked to contribute opinions on a subject, with no preparation whatsoever. Research has shown that, while commonly employed, such approach produces weak ideas.
A much better approach is to pose the key questions and allow participants to explore them on their own prior to bringing the group together. For example, you can ask each participant to suggest three prospective product lines, propose a new market niche or recommend a change to corporate vision.
4. Use visual aids, charts, whiteboards
Visual aids are useful in getting the attention of the participants, explaining high-level concepts and framing. I like double-axis charts, you can use whatever works well for you. Capturing the conversation on paper or whiteboard is critical. Everyone has his or her own technique and I like to always identify action items clearly and keep a “parking lot” space for everything that needs to be dealt with but is not immediately relevant.
5. Select participants carefully. It is popular to be inclusive but you don’t need any deadweight in the room. A few years ago, I facilitated a strategy session for a large medical laboratory. Despite the highly animated discussion, the production manager fell asleep in the boardroom. She was brought in at the insistence of an executive and did not say as much as a word in the three hours that she spent there.
I also suggest avoiding groups that consist of people too removed vertically on the corporate ladder. It is common for subordinates to withhold their opinions, while those higher up in the hierarchy tend to monopolize the airwaves. If the input at all levels is necessary, conduct several sessions so that participants of any given group are from no more than two levels of the org chart.
6. External facilitators are very useful but not absolutely necessary. Here is why an external strategist is worth his or her fees:
a. Has done it many times and will be able to arrive to a better result faster
b. Will be able to contribute his or her ideas
c. Brings in best practices from the outside
d. Can ask provocative questions without the fear of fallout
e. Can offer frank opinions without the fear of retribution
f. Frees up time of the internal champion
7. Creating from scratch is difficult – seed discussion with ideas. Creating a corporate vision or a department strategy from scratch is often intimidating and can lead to deafening silence in the room. Offer starting points that can be critiqued and built on instead of starting with a blank sheet of paper.
8. The most common problem is the fixation on tactical issues. I can pretty safely guarantee with 100 per cent certainty that you will see purely tactical and often trivial issues brought up. If one of the strategic imperatives discussed is customer retention, you are bound to hear opinions on point cards, special promotions and system requirements to handle them, all reasonable points that have no place in a strategy session.
Here is how to deal with it: promptly capture valid points on a separate sheet of paper or a section of the whiteboard (if you don’t do that, people will stop talking) and move the discussion along, calling to concentrate on the “what?”, not the “how?”
9. Most difficult settings: interest groups comprised of volunteers, joint ventures, committees in highly political environments (public sector, healthcare, education).
Interest groups and joint ventures seldom have the same level of accountability that can be easily established in a corporate setting. Joint ventures are often tentative with the participants unwilling to invest more time and effort than their counterparts. In highly political environments, participants are careful not to expose their true point of view so not to endanger their long-term position.
I have done strategy work in these settings and it can be done; however this content is beyond the scope of this little article.
10. Dispel self-censorship. Groups of individuals often exhibit deficient thinking and decision making known as groupthink. There are several attributes to it, which I will write on soon, but for the sake of this discussion, let’s talk about one – self-censorship. You may have observed in the past how often you are likely to see an idea shot down in a meeting. Forget it, it won’t work here! They won’t allow us! We’ll never get this funded! And, piece de resistance… We’ve never done it this way!
Watch out for such behavior as it kills all innovation and new thinking dead. Disabuse the team from the notion that today’s constraints should be used to censor ideas for the future.
11. Demonstrate traction and usefulness of strategy work. Nothing kills the impetus to think strategically faster than a strategy setting that leads nowhere. Commit to and implement the strategy you developed, hence exemplifying accountability.
12. Re-examine regularly. The world is not standing still and every strategy needs to be tested and assessed regularly to ensure that it is still valid. It is not a set-it-and-forget-it kind of an undertaking and I recommend building a habit for you and your people to work on strategic content a couple of hours every week.
In my consulting work, I have met scores of IT leaders whose beliefs kept their departments from flourishing and becoming truly valuable to their organizations. Instead, they exhibited passable performance, produced little innovation and were viewed by the business as a painful but unfortunately necessary expense.
I wrote an article on a small assortment of such limiting beliefs for Techrepublic.com. The article can be viewed here. Have you observed them in your organization ?
Seeing that many companies are repatriating their previously outsourced processes (I am talking specifically about outsourcing, not offshoring), I wonder where the outsourcing pendulum is going to swing next.
The “outsource-repatriate” exercise is an expensive one. First, there are obvious costs to just executing the transition, twice (and coming back is often very difficult). Second, there are likely even higher costs as a result of revenues and customers lost in the process and inability to address strategic projects while being engaged in the outsourcing hopscotch.
There is one key question that must be answered to save you from this hassle:
Does the outsourced function have strategic value or not?
If the function is not strategic, like facility management, as an example, it is a good candidate for outsourcing. Would Customer Service be a good candidate? It depends. If the responsibilities of the Customer Service department are trivial, such as providing product information and recording service calls, it may work well. If these folks are empowered to make decisions, if your company sees excellent Customer Service as the area of competitive advantage, if you strive to innovate in this area, than no, it won’t work.
The strategic vs. not consideration is especially critical in IT outsourcing. Organizations which hastily outsourced their development, found that every project, however small, now came with a hard cost. Innovation became replaced with a rigid contractual arrangement, the progress became convoluted and slow.
Outsourcing allows organizations to concentrate on key strategic activities. Knowing what can be outsourced and what mustn’t is the key decision factor.
These pictures are from the Valley of Fire, Nevada. I took them a couple of weeks ago while enjoying some gentle south-western winter sunshine. The tough desert climate, poor soil and unforgiving terrain are all redeemed by the sheer beauty and drama of the landscape.
This place is unforgiving and even minor hiking should be taken seriously -complacency kills! – yet the desert is full of life. Rabbits and smaller rodents, snakes, lizards, foxes and numerous birds make the desert their home. Despite the adversity of the environment, they thrive here.
Are you thriving or merely surviving today? Here are five questions I have for you as a technology executive:
1. Have you lately come up with an innovative use of technology that puts your organization in front of your competition?
It is troubling that we find IT departments today more and more focused on simply keeping the lights up, not unlike a humble (yet very expensive) janitor?
2. Do you know what your organization’s strategic priorities are today?
Cost cutting? You can’t grow buy cutting costs. I mean – really, where is your company heading and how can you as the head of IT enable this journey?
3. Are you working on the right things?
Do you and your business counterparts evaluate the basket of projects you are working on regularly? If not, how do you know you are spending limited resources on the right thing?
4. Are you laying people off “to conserve cash”? How do you know you are not permanently disabling your department and organization?
If you must, it is better to cut vertically than horizontally – it is more difficult but it is right. More on this here .
5. Do you communicate with your employees regularly and openly?
On a daily basis, I receive horror stories from people about embarassingly trembling, unsure, vague, inaccurate and even clearly dishonest communication coming from the C-suite.
As a technology executive, you have enormous powers at your disposal: probably the best educated department in your organization, capable of innovation. Innovation, when aligned with the overall strategy, creates sustainable competitive advantage and ensures that the business will not simply survive but thrive.
IT management often laments the lack of respect and understanding from the “business side” of the organization. CIOs find that they are not quite on par with the rest of the C-level group, positioned as senior order takers, not strategic decision makers. A CFO once told me that “IT is basically a black hole”.
Does this sound familiar?
If you are in charge of an IT department and recognize that there is a problem (many don’t), you may want to know how to change the perception and bridge the gap between IT and the rest of the organization. The issue at hand is your department’s credibility. Here are five simple things that will cost you nothing but make a world of difference.
1. Learn as much as possible about the business of your organization, the industry and the key economic factors shaping the market. Enable your people to do the same.
2. Engage you business side peers in conversations. Ask questions about their part of the business process, concerns, views, pressure points. Listen much more than talk. Encourage your people to establish similar connections at their level.
3. In the majority of organizations what IT does day in and day out is a mystery. Hold open door days, issue a newsletter, keep a blog – market your department to the rest of the organization.
4. Learn to speak business language (see my article on this here) and develop this skill in your people – engage them in thought provoking conversations, sponsor learning, work with a coach.
5. Showcase your understanding and appreciation of the business content by offering your opinion on business issue and suggesting strategically valuable ideas that propel the organization forward.
If you do it right, you will develop credibility and a reputation of a strategic thinker. Your department will seize to be “a bunch of propeller-heads” and will evolve into a strategic asset of the organization.
What is stopping you ?