Transforming IT

Is IT As We Know It Really Dead?

There has been a lot of press lately about the doom and gloom scenarios that spell the demise of IT as we know it.  I clearly believe that IT must undertake active transformation efforts to meet the requirements of the future.  But I hardly think that IT is going to somehow become less significant or just become outsourced to the cloud.  In fact, I think that as technology becomes ever more strategic, IT organizations will be elevated to more strategic roles.

I'm not alone.

In a recent post in InformationWeek, Bob Evans makes the case for why IT is, in fact, entering a Golden Age.  In The Golden Age of IT has Begun, he lays out 6 reasons that the stage has been set for IT to finally realize its potential.  And, of course, I think that this means that there's a lot of IT transformation on the horizon!

The Key to Becoming Effective

In one my recent posts, IT Transformation Begins with Organizational Effectiveness, I made the case that all IT transformation efforts must begin with doing the basics right, consistently and reliably.  It's one of the three pillars of our vision for IT Transformation.  But what does it mean to become an effective organization?

While there are many aspects to becoming "effective", there is one simple key that starts it all - your mission.

It may seem overly simple, but to be effective you must begin by understanding what you are trying to achieve.  For some reason, countless organizations have set out to become "more effective" without any understanding of what their mission is meant to be.  But being effective is not about "doing things right", as the saying goes - it's about doing the right things. 

And you need to know where you're trying to go, to know if you're doing the right things.

I will be posting a new article on this subject that goes into more detail once our redesigned website goes live, but this one key point is worth noting and remember and repeating - over and over again.  Know your mission. Say it clearly.  Ensure that your team understands it at their core.  Then drive everything you do from the power of your mission.  Anything less is just spinning your wheels.

Does Your IT Team Know They Matter?

Last week, I was at an executive networking meeting filled with a bunch of very smart people.  Mostly company founders and executives, but one of our speakers that night was another really bright guy named, Matthew Emerzian.  He co-wrote a book called Every Monday Matters about how each person can make a difference.  He is in the process of launching a non-profit to take the message to school children that: "You Matter" because You can make a Difference.

I was very impressed with his mission and goals - and I was very pleased that our networking group is supporting him.  But it also made me think about his message in the context of IT organizations.  Does the average IT staffer think that they matter?  Do they understand how their function impacts the organization?

In most of the IT organizations where we work, there are hundreds or thousands of IT staff.  They often have very specialized, technical functions.  And I think it's easy to see how they can become disconnected from how everything works together to actually provide value for the business.

I think that this creates the problem that we often talk about - that IT people start looking at technology for the sake of technology and not understanding the business perspective.  But there's another side to it that this presentation made me think about. 

If IT folks get disconnected, I think that they also can lose perspective on the value of their work - on their own professional worth.  It's easy to think that what you do doesn't matter.  After all, it's just some database blinking away in a data center somewhere.  Does this lead to a lack of professional and personal fulfillment?  It probably does - and I think it's another reason why we need to get things connected again.

In my recent post, IT Transformation Begins with Organizational Effectiveness, I wrote about the need to get your team pulled together to deliver routine services consistently.  But if your team doesn't see and feel the value of those routine services, it could be a rough uphill climb.  Maybe we all need to adopt a "You Matter" campaign within IT organizations to make sure the entire team understands just how vital and important they are.

IT Transformation Must Drive Business Value

This is the third post in a short series describing the three pillars of our vision for IT Transformation.  The third part of our vision is really where it all comes home:

IT Transformation Must Drive Business Value

One of the greatest risks that IT organizations have when undertaking a transformation initiative is believing that becoming an effective and efficient organization is enough.  As I discussed in my last post, IT Transformation Begins with Organizational Effectiveness, it is where you must begin, but being effective is merely meeting the base expectations of the customer.  In the end, if you are merely effective, you are still nothing more than an effective commodity provider. 

The ultimate goal of any IT Transformation initiative must be to provide strategic and competitive value to the business.  It is only in this state that the business' investment in IT will be fully realized. 

To accomplish this will require that IT transcend its traditional structures, perspectives and sensibilities.  It will require the creation of a service culture, a commitment to transparency and the development of true intimacy with the business.  Only through this level of transformation will IT be able to truly stand in partnership with the business.  And only then will IT be able to drive technology-enabled innovation that accelerates the achievement of business objectives in unexpected ways. 

It's surely no simple task.  But that, after all, is what a transformation is meant to be - the fundamental change in form, shape and appearance of an organization.  So, are you ready to transform?

Is “IT Transformation” the New “Outsourcing”?

Ten years ago, I worked for an Outsourcing company. We did dozens of large hundred million dollar plus deals. But, what I remember most about that time was watching the Evening News. At least a couple of time a month, there would be a story about a company outsourcing their IT to a major supplier. (And it felt really good to have been a part of them.) I started thinking, when was the last time, I had heard (or read) about a major outsourcing? And I couldn’t remember.

So, I talked with my friends who are still in the Outsourcing industry and they confirmed there are still plenty of Outsourcing deals being closed every month. But, the type of deal has changed. No longer are companies Outsourcing their entire IT departments, no instead they are doing “Selective Sourcing”. A company will outsource a specific IT function (e.g. Firewall Maintenance, Server Management, etc.) to a company that specializes in delivering that type of service. Taking a “Best in Breed” approach to who performs a specific service. But that creates another problem; the IT Organization now needs to figure out how to interface with multiple providers in order to deliver a seamless service to their Business Units. They are forced to fundamentally change how they deliver service.

Let’s take a look at the most common driver of why a company Outsources or Selectively Sources services:

• Financial: Almost every Outsourcing deal contains a financial component, either a cash infusion from the sale of assets, or more commonly, reduced operational costs.
• Service: In many cases, the failure to deliver adequate services to the company’s Business Units drives that company to seek other alternatives.
• Advocate: Often new Leadership feels the company should concentrate of their primary business and not expend talent and resources on IT.
• Technology: Upgrading to new technology is often expensive. By Outsourcing a service, the Outsourcing supplier incurs the expense of the new technology.

But what does any of that have to do with IT Transformation? Let’s take a look the most common drivers of IT Transformation:

• Economic: In today’s world, every IT organization is faced with reducing their costs to the company. This often takes the form of automation, which forces people to change the way they perform their jobs.
• Service: The world economy and web has forced most businesses into an always available operating mode. This change has significantly impacted IT. Gone are the days of scheduled “downtime” to perform upgrades and maintenance. IT organizations now have to perform these functions without interrupting service.
• Advocate: IT Leadership has seen the value of adopting new methodologies to improve the delivery of their services. Just to name a few, methodologies like COBIT, ITIL, ISO, Agile have significantly changed the IT landscape.
• Selective Sourcing: Remember I mentioned that most companies are now Selectively Sourcing commodity services? This has forced IT organizations in the role of IT Integrators, a role that most have never performed.

As you can see, the 3 of the 4 factors that drove companies to Outsource in the past are now driving them to Transform their organization, and those that Selectively Source services are forced into an even more drastic Transformation. Although companies are facing similar pressures they have in the past, they are now forced to respond in an abbreviated timeframe. 

So ask yourself, “Has IT Transformation become the new Outsourcing?” And how has that that shift in focus impacted IT organizations? Most IT groups have a lot of experience in managing vendors, so Outsourcing is not a foreign concept. But, very few companies have any practical experience in transforming the way they operate or acting as a Service Integrator. How are companies handling their Transformations? We will spend some time in the next article discussing how different companies have approached their Transformation and the types of partners they choose to assist them.

IT Transformation Begins with Organizational Effectiveness

Picking up from my last post, IT Transformation is About Cultural Change, I'd like to address the second piece of our vision for IT Transformation:

IT Transformation Begins with Organizational Effectiveness

IT Transformation sounds big.  It sounds sexy.  And so organizations often run off and want to focus their transformation effort on big and sexy things.  They want to "align with the business" and become a "true business partner" and on and on.  The problem is, that in many cases the conversation goes something like this:

IT: "We are launching an IT Transformation initiative to become your true business partner and work together to create innovation solutions for our customers."

Business: "Uh, that's great.  But how are you going to do that when our systems aren't very stable and it takes you 10 days to deliver a PC for one of my new employees?"

Of course, this is an exaggeration, but this is the essence of what goes on.  In many cases, IT lacks the credibility to have a "strategic conversation" with the business because they have not yet demonstrated that they can delivery routine services consistently and reliably.

So we believe that in order for an IT Transformation initiative to have legs, it must begin with organizational effectiveness.  It's table stakes.  IT must be able to operate effectively and efficiently with what's on its plate before the business will be willing to invest the time to create a more strategic relationship.  This requires that IT begins the transformation process by instilling discipline.  It means that IT must be mission- and metrics-driven, united in its operations (no more silos!) and it must be highly agile and adaptable.  

The last part of our vision makes it clear that organizational effectiveness is not enough, but it is where you must begin.

IT Transformation is About Cultural Change

I've had trouble writing lately because we've been immersed in a bunch of marketing and business development activities - including the redesign of our website.  As part of that, we've been retooling some of our messaging and I want to preview just a little bit of it here.

One of the things that has thoroughly annoyed me is that the term "IT Transformation" has reached that point in the cycle where it's become almost meaningless.  The number of things that I've seen attached to the term "IT Transformation" boggles the mind.

I momentarily toyed with abandoning the term in favor of something that wasn't so co-opted.  But upon reflection, we decided that it would have been a cop-out.  IT Transformation is far too important - far too meaningful to let this go.  So, instead, we've decided to retrench and fight back a little. 

So, here goes.  What does it mean to "Transform IT"?  We believe that it fundamentally means three things and I'd like to address the first of them today.  At it's root, IT Transformation is about cultural change.  If you're not seeking to fundamentally change the way IT does business - to change organizational behaviors and attitudes - then it's not an IT Transformation.  It's merely a project.

It may be a big project.  It may be a vitally important project.  But it's still not transformation.  You may need to transform in order to make the project a success, but transformation is about cultural change.  Pure and simple.  This may seem academic, but it's not.  This understanding is at the foundation, because it tells you what you really need to be focused on to succeed. 

If it's a transformation effort and you don't focus on your people and on behaviors, your initiative will fail.  If you call something transformation that isn't, you're just setting yourself up to not meet expectations.  And when you really need to launch a true transformational effort (and you will) - you will have spent the political capital you'll need to make it succeed.

I'm a bit passionate about this because I believe that people that are misusing the term transformation (mostly vendors, truthfully) are doing everyone a disservice and putting some very important efforts at risk.  So forgive me if there's a bit of indignation coming through, but this is important stuff - at least from my perspective.

Over the next week or so, I'll make additional posts covering the other two things that we believe an IT Transformation represents.  Until then, I hope that this first, core piece of our vision for IT Transformation makes sense to you.  Stay tuned....