Posts Tagged ‘it strategy’

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When Giving IT Information, More Is Better

Wednesday, April 1st, 2009
Providing Data About Data Can Make Data Even More Valuable To A Company

Providing Data About Data Can Make Data Even More Valuable To A Company

So just what is the job of an IT department once you get past the keeping the network up and applications running stuff? I think that we can all agree that it must have something to do with the company’s data, but exactly what does that mean?

Ranjay Gulati, James Oldroyd, and Phanish Puranam are three researchers who have been studying this problem and they’ve made some interesting discoveries. They realize that IT is the source for countless reports – our job is to turn data into information that the company can take action on. However, they’ve discovered that it can be just as important that we share with the rest of the company HOW we’ve come to know something as well as WHAT we know.

Now this is the tricky part: IT needs to find ways to tell our audience the answers to their questions AND we need to tell them how we got the data and what, if any, strengths and weakness there are with that data.

If you want to get all fancy about this the word to use would be that we need to provide “metadata” with our reports. A good example of this would come from the Royal Bank of Canada.

A few years ago the bank implemented a system that when a customer was overdrawn on a check, the system would do some credit / overdraft history checking in order to determine if a courtesy overdraft should be granted.

The information on the system and the data that it used was distributed in the bank and an ATM product manger happened to read it. He realized that a similar system could be created to provide overdrafts for ATM customers. The bank spent about $100,000 to implement this new service and since then has made millions off of it.

Allowing staff to not only see the output of an IT department, but also the information on the data that was used to create that output allows more people to find ways to reapply the data in ways that you may have never thought of.

When your IT department produces reports, do they include any information on the data that they used to create the report? Has anyone ever been able to use this “metadata” to identify a new use for the data? Was that new use valuable to the company? Leave me a comment and let me know what you are thinking.

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Does IHOP Have Tasty Lessons To Serve Up For IT?

Monday, February 2nd, 2009

IHOP's CIO Has Some Lessons For All CIOs Who Want A Seat At The Table

IHOP's CIO Has Some Lessons For All CIOs Who Want A Seat At The Table

I don’t know about you, but I’m always open to having breakfast no matter what time of day it is. This might explain why so much of my life has been spent sitting in IHOP restaurants eating mountains of pancakes. When I stumbled across an interview with IHOP’s CIO in eWeek magazine, I was of course interested…

Patrick Piccininno became IHOP’s CIO way back in 2003. He’s got some interesting thoughts on what it takes to get and keep a CIO as a part of a company’s strategy team. Piccininno agrees that just to get the CIO a seat at the table has been a long fought battle.

He believes that in order for a CIO to keep his/her seat at the table, they need to make sure that they are not a wallflower – they actually have to be participating members in planning the corporate strategy and they need to be willing to work with the CEO and the other members of the executive team.

Here’s the key take-away for all of us IT lovers: Piccininno states that in his experience, a CIO needs to take off his/her technology hat and instead put on their business hat. When working with other members of the executive team it’s critital the that CIO focus on those transformational initiatives that will help the company to achieve its business results.

Piccininno believes that what the rest of the company really wants from the IT department is to simply believe that they are in good hands – that the IT infrastructure will support whatever needs to be done to grow the business.

I think that we’ve all heard this kind of talk before, but it can be very difficult to understand exactly how to put it into effect in the real world. Piccininno offered an example that provided a good case study.

Back in July of 2007, IHOP announced that it was going to buy the Applebee’s restaurant chain. This was a big deal – it was valued at about US$2.1B. As Piccininno points out, a key part of the decision to go ahead and buy Applebee’s rested on the ability of the IHOP IT department to be able to successfully integrate two sets of disparate systems and environments quickly in order to reduce costs.

In order for IHOP’s IT department to be able to support this large scale merger, they needed to have made and implemented key IT infrastructure decisions a long time ago. Because they had made these decisions, the CIO was able to play his role in supporting the company’s strategy for purchasing Applebee’s.

The business world that we all find ourselves living in these days sure seems to have become more complex. We’ve got new regulations to live with including Sarbanes-Oxley and General Computing Controls. What all of this means to a business is that IT is now up in front and center of how the business is run. Without including IT in the planning of the company’s future direction, there is a great chance that the rest of the company won’t be able to find their way…

Do you feel that IT has a “seat at the table” at your firm? Does your CIO have the ability to talk tech with the IT staff and then turn around and talk business with the rest of the firm? Do you feel that your IT department does a good job of supporting the rest of the firm or are you constantly holding them back? Leave me a comment and let me know what you are thinking.

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Posted in CIO | 2 Comments »

IT Innovation Tips From GM’s CIO

Thursday, November 13th, 2008
GM Has A Massive IT Outsourcing Program - Has It Helped Or Hurt The Firm?

GM Has A Massive IT Outsourcing Program - Has It Helped Or Hurt The Firm?

Ok, so maybe this is not really the best time for this posting seeing as the desperate situation all three of the major U.S. manufactures are currently in due to the current recession. However, if you can put all of that aside for just a bit, then Ralph Szygenda who is the CIO at General Motors (GM) had a talk with the folks at eWeek and he has some suggestions on how IT departments can use outsourcing to drive innovation. Now there are two terms that you don’t often see together! Let’s see what Szygenda has to tell us…

Who Does GM Outsource Their Work To?: About 60% of it goes to EDS (now part of HP) for historical reasons (GM once owned EDS), the rest goes to AT&T, HP. IBM, Capgemini, Covisint, and Wipro. Whew – is there anyone who is not on that list?

What Kind Of Money Are We Talking About Here?: In 2006 GM spent $7.5B on outsourcing contracts and, assuming that they don’t fold during the current economic crisis, they plan on spending another $7.5B in 2011.

How Many GM Employees Are Needed To Mange All This Outsourcing?: 1,500 GM employees manage the combined outsourcing vendors.

How Does GM Keep Their Outsourcing Vendors In Line?: GM continues to outsource additional business every year to the tune of 100′s of millions of dollars. All of the outsourcing vendors want to win this additional business. GM uses a report card that gets updated every 6 months to let each vendor know exactly where they stand and then GM uses that report card to make decisions about who gets additional business.

Does GM Kick Out Under-performing Vendors?: So far – no. However, all development of new systems are done at a firm, fixed price. That means that they start to lose money if they are missing a due date. There aer some firms that have not been able to win new business because of how they have performed; however, nobody has been kicked off the team yet.

Are IT Costs Going Down Because Of This Outsourcing?: GM reports that they are spending a lot less on support and maintenance. However, they’ve taken these savings and are plowing them back into the development of new IT systems. The overall cost of operating the GM environment has been going down for the past 12 years and they are forecasting it to continue to do so for at least the next three years.

Why Did GM Decide To Outsource So Much Of Their IT Operations?: GM did not get into the business of outsourcing their IT operations to cut costs; however, the results have been that costs are being cut. The reason that GM originally decided to outsource their IT operations was because they had started with autonomous business units – every branch had it’s own IT shop. Over the course of 10 years they’ve gotten rid of over 5,000 systems. In 2006 they decided to consolidate their IT operations. Outsourcing IT operations has allowed processes to be standardized across the organization.

What Is The Key To GM’s Innovation?: Szygenda says that it comes down to three things: standardization, simplification, and collaboration.

Do you think that GM’s massive use of outsourcing is a good thing or a bad thing? Do you think that distributing the work among so many different outsourcing firms makes managing the work harder or easier? What do you think that Szygend’s next steps need to be? Leave a comment and let me know what you are thinking.

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Wicked Ways Of Managing Wicked IT Problems

Thursday, September 25th, 2008
Dorothy Knew How To Deal With Wicked Problems

Dorothy Knew How To Deal With Wicked Problems

Wicked IT problems can frustrate even the best of us – by their very nature, wicked IT problems have no solution (that’s why we call them “wicked” and not just “hard”). As we talked about last time, although you may not have the tools to solve these types of problems, you do have the tools needed to manage them. However, the key to dealing with problems like this successfully is to involve the entire IT department (yes, these problems are really that big). Let’s talk about how you’d go about doing that…

The first department-wide step that you’d need to take is to get everyone to focus on taking action. In traditional problem solving, we think though all of the possible strategies that we could execute and then pick the one(s) that we think will solve the problem. Sorry – that approach doesn’t work when you are dealing with a wicked problem. Instead, what you need to be doing is some experimenting. Specifically, choose a collection of strategies that you think MIGHT work and start executing on them. This approach actually has a name it’s called the “science of muddling through“. One thing that you’re going to have to keep in mind is that every action that you take to deal with the wicked IT problem will cause the problem to change. Remember, we’re dealing with a wicked problem here!

Finally, you need to take the hardest step. You need to implement what is called a “feed forward” process for your IT department. We are all very familiar with feedback systems where we compare the results of our actions to our original plans and then change our actions accordingly. Once again, bad news – feedback won’t help you to deal with a wicked IT problem, instead  you are going to need a feed forward solution. A feed forward process requires IT management and workers to take the time to imagine the IT department in the future. The future should be defined as being 5, 10, 25, and even 50 years down the road. The goal of this process is to picture what the IT department will be like, and then to determine what steps need to be taken today in order to move the department towards that goal.

So there you have it – ways to mange your wicked IT problems. Remember, when you enecounter a fustrating IT problem, there is always the chance that it may be a wicked problem. These types of problems can’t be solved and so you’re going to have to practice some wicked management…

Have you ever encountered a wicked IT problem? Did you try to start multiple strategies to deal with it all at once? How did this turn out for you? Have you ever had your IT department try to imagine how the department will look in the future? What did you do with this vision? Leave a comment and let me know what you are thinking…

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Posted in strategy | 2 Comments »

Managing Wicked IT Problems

Monday, September 22nd, 2008
How to manage wicked IT problems

How to manage wicked IT problems

So we’ve chatted about Wicked IT Strategy problems – these are the ones that you really can’t solve. Given that, you’ve got a couple of different things that you can do. The easiest is to throw your arms up in the air, say “this can’t be solved”, and then work very hard at getting promoted so that it becomes someone else’s problem. Good luck with that approach! Let’s take a look at some other solutions for those of us who feel a deep burning need to make the world a better place for all…

Let us acknowledge that wicked IT problems can’t be solved. So your next best alternative is to come up with ways to cope with them. They aren’t going away, so you need to find some common ground that will allow you to live with them. As with all of us in IT, there are countless complicated solutions that you could probably come up with in order to address any problem. However, here are a couple of relatively simple actions that you can take that will yield real results:

Make everyone responsible for finding a way to manage the problem. This means that you need to reach out and drag in employees, customers, management, etc. and you need to make sure that you document everything that is said and establish clear means of communication between all parties. Because a wicked problem is so complex, it will take a wide variety of views and opinions in order to come up with unique ways of managing the problem. However, be careful! Don’t just collect inputs. Instead, make sure that everyone is involved in actually implementing their suggestions. Yes, having more people involved will make things more difficult, but because of the complexity of the problem they are all needed. Documenting all ideas and discussions will become more important when a plan is finally agreed on – the documentation will be needed in order to communicate the plan to the rest of the department.

Define what your department’s identity is. Although many different suggestions will be made as to how best to manage the wicked problem, it will be critical that whatever solutions are finally put in place are true to the IT department’s identity. The department’s identity is the cornerstone of its strategy and provides both direction and focus for the IT leaders. An identity is made up of a department’s values, competencies, and its aspirations. Staying true to these will allow critical decisions to be made quickly and painlessly.

But wait, there’s more that you can do to manage wicked problems. We’ll cover these next time…

Have you been able to assign responsibility for large problems to all of those who need to be involved? How did that work out – did the number of people who were involved make it hard to reach any sort of decision? Do you know what your IT department’s identity is and do you reference it when you are making decisions? Leave a comment and let me know what you think.

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