Post #5 in the Series: Prioritization

Business says: “I need this right away.”

IT says: “Sure, but three other executives just told me the same thing.”

“IT people are in a tough situation. While they have to provide service to every unit in the organization, business-unit chiefs tend to recognize only the work IT does directly for them. One CIO said, “We need a way to ensure that resources go to the right people, not just to the ones who yell loudest.”

To accomplish that, executives need to decide which projects are most valuable to the company. The most successful companies have clear ways to estimate the value of every proposed project—how much it will boost sales, say, or increase efficiency. Then they have a clear method to decide which projects are most worth doing. Some firms use a steering committee headed by the CFO or CIO. Others use different methods. Whatever method is used, there must be a way to ask tough questions to ensure the company allocates its IT resources wisely.

But it doesn’t end there. Any good manager knows how to game a system like this by inflating a project’s projected value or overstating its prospects of success. So the best companies require executives to report back with evidence on whether each project met its goals. That reduces fibbing and helps executives learn how to drive more value from IT.”

Tom’s Take:

Engaging a third-party IT vendor, such as Intertech, is a great way to supplement a company’s internal resources, particularly when an IT department needs to quickly scale up resources. Consultants provide the metaphorical extra arms and legs needed to get the job done. Beyond bandwidth, vendors can bring new knowledge and expertise that in-house staff may not possess.

Post #4 in the Series: Focusing on Results versus Process

Dr. George Westerman of MIT writes:

Business says: “I want it this way.”

IT says: “We can’t do it that way.”

“In too many companies, the CIO is seen as the “CI-No.”

To many on the business side, the way things should work seems simple enough. They want IT changes—new mobile devices, maybe, or new system functionality—and they don’t see why IT can’t deliver what they want. But obviously there’s more to the story.

IT leaders know it’s not that simple. They need to be sure that any changes don’t compromise the safety of the company’s IT systems and business processes. And they know the downsides of introducing nonstandard devices or unnecessary software customizations. Exceptions create complexity, and complexity is the major driver of extra cost and risk in IT.

The key in bridging the gap is for IT leaders to explain clearly the reasoning behind saying “no.” If they give the business side enough insight, future requests might even be more reasonable. IT people also need to be open to exceptions when the new approach is much better than the standard approach, or when there is another good reason for it. Meanwhile, business people should aim to say what they want to do without requiring it to be done a certain way.

For example, in a major energy company, when people request something that won’t work well, the CIO says, “Give me a couple of weeks.” Soon, he’s able to say, “Here are the costs, benefits and risks of doing it your way. And here are two other options that do what you want, but are better.”

Tom’s Take:

At the end of the day, our job is to deliver results in the most cost-effective way possible.  We’re also lucky to work with many smart clients, typically IT people themselves, who do not waste time – or their investment in our services – by explaining to us how to do our technical work (unless, of course, we need to do something in a different or specific way to stay in compliance with their standards). So while we’re usually in complete agreement with customers on the work to be done, we still look for ways to add value beyond the stated objectives.

For example, Intertech recently was working with a firm specializing in product lifecycle management and 3D modeling. Using an agile software development process, our team was able to deliver all of our core requirements and more several weeks early. In fact, most of our team was able to roll off the project earlier allowing our customer to reallocate the funds to other projects.

Post #3 in The Series: IT Cost and Performance

Dr. George Westerman of MIT writes:

Business says: “IT costs too much; we’re not getting the service we’re paying for.”

IT says: “Given our budget constraints, we’re doing really well.”

Who is right and who is wrong? Without a clear understanding of IT performance, there’s no way to know.

Here’s an example: The IT unit in a multibillion-dollar auto retail firm was considered “fat and happy” by those outside of IT. Was it too expensive? Perhaps. But happy? Not at all. IT people were trying to do a good job, but all they heard were complaints about costs and failures.

The first step in fixing the situation was to understand exactly what IT costs and performance really were, not just what they seemed to be. IT leaders started tracking downtime and problem-resolution time, as well as project and budget performance. They made the information available in ways that everyone could understand.

The informed verdict: IT wasn’t as good as the IT people thought and it wasn’t as bad as the business side thought. Most important, everyone now knew exactly where things stood and what needed to be done. Over the next few years, IT costs dropped while performance improved. Satisfaction increased for both business and IT people.

Business leaders started to trust the IT leaders more. Plus, the new clarity led to easier decisions during budget time. Before all this, when a major outage occurred, business executives called for the CIO’s head. When a similar outage happened five years later, business chiefs took it in stride, saying, “They’re doing a great job. Everyone has a hiccup from time to time.”

Tom’s Take:

When companies hire IT vendors such as ours, costs can be handled on either a fixed-bid or time-and-materials basis. We prefer working on a time-and-materials basis so we can work in a collaborative manner.

While responsible vendors must find ways to add value no matter what the billing arrangements, we’ve moved from the waterfall approach to an Agile/Scrum approach.  The heart of Scrum is an iterative and incremental method for managing projects.  A result is more frequent deliverables.

Clients appreciate this approach, which gets software into the hands of end-users much faster than waiting until an entire project is finished. Business managers who must manage expectations on a quarterly basis especially like how this approach yields tangible results quickly and efficiently.

Post #2 in The Series: IT is from Mars, Business is from Venus

“Any marriage counselor will tell you there are two sides to every story. And that can be OK—as long as each side understands the other. But marriages suffer when the two sides can’t find ways to communicate and resolve their misunderstandings.

In many companies, the relationship between IT and business leaders is a very troubled marriage indeed. Miscommunication is rife, leaving executives struggling to figure out what’s working for the company, what’s not, and how to improve the situation. Can a marriage like this be saved?

It can, when IT and business executives have a clearer understanding of the needs of both sides, how they work and the challenges they face. That means business leaders and IT executives talking with each other about their operations and about how IT can help the company fulfill its goals, instead of talking past each other about how one side or the other is preventing that from happening.”

The text above is from Dr. George Westerman of the Massachusetts Institute of Technology, which first appeared in an April 2012 edition of The Wall Street Journal. It caught my eye because similar dynamics are at play between IT vendors, such as Intertech, and our business clients and their managers. The article went on to detail four areas where IT and non-IT executives often fail to understand each other clearly, and how transparency can help. My next four posts will explore those areas, leading with Dr. Westerman’s take and then providing my own from the vendor-client perspective.

Time on the Couch… Counseling IT and Business

Know anyone who feels their IT department is too quick, too cost effective, or delivers too much?  If the answer is yes, they’re part of an exclusive group.

A quote from a presentation I’ve delivered on software development from Jim McCarthy is “More people have ascended bodily into heaven than have shipped great software on time.” While funny, the inability and disconnect between business and IT creates disappointment, “just O.K.” results and, frustration.

In a Wall Street Journal article, Dr. George Westerman, a research scientist at the MIT writes about the disconnect between IT and the rest of the organization.  In it, he states transparency (in decisions, communication, etc.) is the best way for a business to work with IT.

His article and my thoughts will be the focus of my next five posts.