IT and the Adolescent Organization
But as the business grows, these needs begin to become pressing -- often challenging the leadership of the organization to recognize that there are new requirements for both their leadership and the businesss functions. From an IT perspective, this entrance into the maturing phases of business growth can be an excellent opportunity to support and accelerate company performance. Moreover, if IT truly embraces its potential, this can be a transitional moment that allows it to develop a vital strategic role in the organization.
There are many models which analyze the phases of business growth. Although there are many other outstanding sources on this topic, many of my observations reference the work of Neil Churchill and Virginia Lewis, who recordedThe Five Stages of Small Business Growth in a 1983 edition of the Harvard Business Review. Whichever business expansion model is examined, however, you will undoubtedly recognize the period of growth in which a business struggles to progress from its initial success as a small business to a more mature organization which maintains sustainable growth.
If we compare this phase of the companys growth to our own human development, it parallels adolescence. New opportunities are accompanied by awkward growth and frequent confusion. More significantly, though, the specific skills needed to deal with these opportunities (and hurdles) change, as well.
Adolescence and the executive function
In middle schools, many students are challenged because the focus of learning shifts from primarily technical functions (such as reading or mathematics) to a new requirement for assuming more executive functions. These executive functions are skills like prioritization, delegation, organization, collaboration, and work planning. We may all recall that age when long term assignments and projects suddenly became a lot more complex.
Businesses at this adolescent stage feel pressure from the same challenges. The strengths of the organization need to transform. The executive functions in any well-organized business become more essential every day. The company cannot rely solely on the success of its traditional product to solve all its problems. This is not to say that the company loses its identity, but it does go through an awkward period of change and adjustment to the new priorities at hand.
For example, the owner of a design firm may be a creative genius, but may also need help managing cash flow or setting up a quality assurance process. A brilliant engineering entrepreneur may have difficulty delegating work and is most likely unfamiliar with HR best practices. Some executives cannot navigate this change. Some may be emotionally tied to the earlier corporate culture or to their role as the singular heroic leader. As a result, their companies may either fail or eventually migrate to new ownership. Other leaders may fair better, but never be able to push the company into the growth mode which is necessary to attain business maturity in later years.
Recognizing the onset of corporate adolescence
So how does IT rise to the call and assist in helping the company through these changing times? By recognizing the signs of these phases, understanding the larger business changes at work, and engaging strategically with executive leadership to augment the skills they need most. By truly understanding the business requirements of their company during their adolescence and recognizing the unique factors at work, IT can take advantage of this period to demonstrate powerful strategic value, and ultimately drive the performance of the organization to new heights.
To begin, it is important to understand the hallmarks of a business entering adolescence. Here are some characteristics to help define this stage:
- An organization at this stage has already passed through the times when the owner did everything and constantly worried about adding clients, delivering product, and generating enough cash to break even. The owner is now withdrawing from day to day responsibilities.
- The organization has lived to see the addition of functional managers, and responsibility for budgets and major decisions are beginning to be pushed out to them.
- Financially, there is a growing sense of stability, both in terms of client base and cash flow. The company is recognizing regular profits and reinvesting them into growth.
- Systems are often unevenly deployed and departmentally isolated with little or no cross functional capabilities.
This is the point when the leaders of the organization typically need to make a decision regarding future growth. To plunge into expansion mode, they must actively reinvest their profits into funding growth to drive the company into this new age. In doing so, they also introduce functional managers, who are more forward-looking, and work towards a vision of the future rather than managing the status quo. These managers may be given responsibilities such as developing their own respective budgets and collaborating to develop strategic plans to march forward as a united group.The growing focus on the future, from developing shared vision to budgeting for growth and strategic planning, are all signs that an organization is going through a significant change.
What follows is are guidelines how IT can use this knowledge to transform from a functional cost center to a key strategic player with a seat at the executive table.
Transforming from cost center to difference maker
The CEO needs help more than ever at this moment (this can be said of mature organizations as well today). As we have said, most entrepreneurs have outstanding skills in at least one key area, and that is how they were able to create and develop the success which all of their staff share in. But not all entrepreneurs have developed the skill of collaborating with a dispersed leadership team, nor that of accurately gauging their performance and managing toward strategic goals.
By anticipating these needs and recommending business solutions (i.e., software packages and the appropriate delivery models -- cloud, on premise, SaaS, etc.) that are catered to them, IT leadership can have a remarkable effect on the success of the company. Consolidating applications into systems that provide forward-looking intelligence will be crucial to effective strategic planning. And the ability to measure progress and tweak tactics accordingly will enable the CEO and functional leaders to be nimble even as the company reaches its growth goals.
ITs ability to unite thought and action from the executive level throughout the company is a lasting strength. Mature organizations entering any new market or growth challenge need this advantage like never before. Global organizations coming out of the Great Recession are seeing major business growth in emerging markets. These businesses need to approach that growth in new ways; ways that mesh with the cultures and economies of the communities they are selling into. New challenges like these tax the flexibility of large organizations. Strategic use of technology can not only help meet those challenges, but transform them into opportunities.
In all of these cases, from growing entrepreneurial companies to global corporations, the IT function transforms into the architecture of the executive function itself. The infrastructure must be reliable and fast. The systems must be integrated and easily accessible onsite or remotely. More importantly, the applications must enable those same abilities we struggled to grasp in middle school. They must provide executive leadership with information that helps them collaborate, assess, prioritize, and organize while providing the CEO with the ability to better coach and delegate. In this way, vision, strategy, and tactics are easily translated from the top down through all levels of the organization.
The CEO can no longer be everywhere at once, though they may deeply wish they could. Their vanishing sense of control can cause real grief. Having reliable systems that keep interdependent functions running smoothly can be an enormous gift at this moment. Moreover, the ability to easily access performance metrics from these systems greatly aids in both tactical and strategic decision making. From process automation to collaboration, unified communications and decision support intelligence, IT must deploy the solutions that the new organization is going to need to truly thrive at this stage of its life.
The best IT leaders will recognize these signs and effectively introduce solutions that empower the organization to succeed. They will consult with leadership from the top down, creating business solutions which are instantly recognized as such, instead of technical solutions which may be less accessible to the C-level audience. And by focusing these solutions on the adolescent organizations new need for analysis, planning, communication, and control, they will reveal their own strategic value in the vision of the future.
Dave Ramsden is chief intelligence officer at Atrion Networking Corporation, where he is responsible for the Information Services team. His focus is on applying technology, process improvement and business intelligence to drive strategic execution across the organization. He has over 16 years of leadership experience working for companies such as Eastern Telecom, Data Comm Systems and Dimension Data. Dave can be contacted at firstname.lastname@example.org.