Making IT Work in Your Company - Page 1

Dec 12, 2001

Steve Andriole

Editor's note: This is Part 1 of a three-part series on strategies for making IT work in the enterprise. Parts 2 and 3 will appear Thursday and Friday, respectively.

Beyond the endless discussions about death march CIOs who report to CFOs, and Cheshire CIOs who've landed seats at the big table courtesy of their CEO-reporting relationship, are huge issues around how to make IT "work" in your company. Here are a few of them:

  • The re-engineering of IT organizations will surface as one of the major corporate imperatives of the new millennium: Companies will look to IT to (really) integrate with the business and provide competitive advantage; organizations that fail to assume this new role will be ousted in favor of new regimes that "get it."

  • Speed and flexibility will become as important as consistency; "good 'ol boy" relationships will be (partially, not completely!) replaced by strategic partnerships that will be judged by performance - not historical inertia.
  • As skill sets become obsolete faster and faster, there will be pressure to change IT organizations at a moment's notice. This will dictate against large permanent in-house staffs organized to protect their existence. New applications pressures will kill entrenched bureaucracies and give rise to a new class of results-oriented hired guns.
  • The emphasis on business/IT alignment will increasingly focus on business requirements which in turn will lead to business applications and computing and communications infrastructure specifications.
  • Given the pace of technology change, it's essential that your organizational infers requirements and produce specifications quickly and efficiently. This will require companies to tilt toward staff with these kinds of capabilities as they proportionately tilt away from implementation skills. IT organizations will be driven by "architects" and "specifiers" - not programmers.

  • Companies will find it increasingly difficult - if not impossible - to keep their staffs current in the newest business technologies. This means that IT organizations by default will have to outsource certain skills. The approach that may make the most sense is one which recognizes that future core competencies will not consist of in-house implementation expertise but expertise that can abstract, synthesize, integrate, design, plan and manage IT.
  • How many of the above drivers hit home?

    The components of your organization strategy appear in Figure 1.

    Business Strategy Linkages

    If you live in a decentralized organization - where the central IT organization owns the enterprise computing and communications infrastructure and the lines of business own their applications - pay very special attention to IT organization. Unless you're prepared to fight lots of religious wars between central IT and the lines of business, organize your internal IT professionals in ways that support the lines of business.

    If your current organizational structure in any way, shape or form encourages an adversarial relationship between central IT and the lines of business then your organizational structure is flawed.

    Assessment of Core Competencies

    Let's make some assumptions about where you are today and where you're likely to be tomorrow. These assumptions will help you think about IT products and services acquisition as well as organizational structures:

  • Business processes necessary to sustain profitability and growth must be flexible and adaptive; "entrenched" or "traditional" processes will not sustain profitability or market share ... organizations pay "lip service" to the value of thinking "outside the box," but seldom actively encourage or reward it.
  • Initiatives like "business process engineering," "total quality management," "process improvement" and similar attempts to change organizational processes for higher profits and greater market share, play out as expense reduction efforts - not as strategic initiatives that provide long-term vision ... there is very little evidence that these efforts have long-term payoff, except as "political" processes that create the impression - both inside and outside of the organization - that there is a logical process at work.
  • Because of the evolution of the technology field itself, many organizations are now staffed with professionals who have a "bottom-up" view of the nature and purpose of information and software systems.
  • Efforts to re-tool and re-train IT professionals have not proven cost-effective: in fact, the amount of time, effort and money spent on retooling and retraining has seldom - if ever - resulted in measurable returns on the investments ... the effort necessary to reach these professionals is disproportionate to the return.
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