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Michael Hugos has a great post on agility where he makes the following point:

“Experience shows me (again and again) that agility is not about working fast but about finding elegantly simple solutions to business problems. You’ll know you’ve found an elegantly simple solution when the business people agree it solves their most important and immediate problems and when the developers know the solution can be built and tested in 30 days or less.

Unless you find a solution that meets these two criteria, it’s not possible to be agile. And often, because people can’t find these simple solutions, they mistakenly claim that agility itself doesn’t work. They come to this conclusion because they attempt to be agile by cramming complex solutions into short development cycles through working harder, longer, and faster.

That attempt has as much chance of success as trying to cram ten pounds of you-know-what into a five pound bag. Inevitably, the bag breaks, and then there is a mess to clean up.

An elegantly simple solution (a robust 80% solution) doesn’t do everything (there isn’t time for that), just the most important things. Finding this solution is not easy; it’s the creative part. It requires business people to figure out what tasks out of all the tasks they perform are the most important ones and what system features they need to handle those tasks. Then developers have to figure out how to build and test a system to deliver those features in the short amount of time available.”

We spend too much time complicating our lives by trying to do too much, too fast! There seems to never be enough time to do something correctly, but always enough time to do it over again! Given to complexity of managing technology, we’re prone to think that complex solutions, are better solutions. Instead we need to focus on implementing good enough solutions, solution that bring about small wins. Small wins, if continually applied, in a thoughtful and strategic manner, quickly add up to significant results. Small wins are more manageable and have less of an impact if they fail. Seeking big wins are extremely difficult, prone to failure and require significant political will! Focus on the small wins…. simple things done well!

 

Technorati Tags: Agile, Agility, Simple, Small Wins, GTD, IT, Project, Management, Business, Technology, Architecture, Good Enough, Execution

An interesting article in the MIT Sloan Management Review discussing IT business alignment entitled "How to Tap IT’s Hidden Potential" By Amit Basu and Chip Jarnagin caught my attention. In the article the authors talk about the traps or obstacles that trip up companies as they struggle with understanding how to use technology strategically within their businesses.

The five primary reasons that IT and business don’t often see eye-to-eye as mentioned in the article include:

1. Mind-set differences between management staff and IT staff: "….Interaction between logic-driven IT personnel and managers who deal mostly in gray areas can be exasperating for both sides. Too often the result is a minimization of such interactions, leaving the IT team feeling misunderstood, unappreciated and isolated. … Unfortunately, the chief information officer often reinforces this separation. That’s because he or she usually is an IT professional chosen to be a director of technology, rather than an executive who is expected to fully integrate IT into the company."
2. Language differences: "…IT people use jargon and acronyms that are indecipherable to others. Executives speak the language of business, fully expecting to be understood by everyone in the company. Much is lost in translation, leading to suboptimal results that IT is blamed for, which causes resentment and cynicism toward management…"
3. Social influences: "…. the persistent perception of those who are oriented toward science and technology as ‘nerds.’ The recent boom in IT outsourcing has Sworsened this estrangement. Now, IT professionals are almost pitied as dinosaurs whose jobs will soon be sent offshore. "
4. Flaws in IT governance (defined as the specification and control of IT decision rights): "….IT decisions are often made by the wrong people with insufficient input, and the resulting failures drive a wedge between senior managers and their IT colleagues. There is some irony here in the fact that outsourcing often appears to improve IT management, in part because a governance committee is needed to manage the relationship with the outside providers. If a similar committee had previously been in place, outsourcing could probably have been avoided in many cases. "
5. Difficulty of managing rapidly changing technology: "…applying IT to business needs, especially when a company is innovating, is still an experimental process with few standards. Technology changes rapidly and is subject to fads, which can be confusing even to IT professionals."

 

Seven Steps to Building a Strong Bridge between It and the Business

The authors recommend that organisations seeking to create a compelling advantage through the smart and effective use of IT in their business follow the following seven steps.

1. Begin with IT literacy—and commitment—at the top. The impetus for effective IT management must come from the CEO and the board. There has to be a willingness on the part of the CEO and the other executives to know enough about IT to understand its functions and its value to the company, in the same way that they understand accounting, finance and marketing.
2. Hire an IT leader who sees the big picture. The next step is to hire a true chief information officer—not just a technical expert, but a leader who understands the strategic importance and use of IT. Choosing a CIO is much more difficult than choosing other top executives. There are very few people with the perspective and the skills to effectively deploy and leverage IT within a business. The best CIO can work within the management culture at the executive level, can present IT issues as business issues to the executive team, and is willing to learn the business as well as technology. Rarely is the CFO the greatest financial expert in a company, or the CMO the greatest marketing expert. Similarly, some of the most effective CIOs at large companies have not been top technologists….. Rotate management and executive candidates through IT. A stint in IT must be part of the training for people being groomed as general managers and senior executives.
3. Create demand for IT solutions. Managers at all levels across the organization need to be convinced that innovations in IT-related areas such as knowledge management, business intelligence, information security, change management and process integration are essential to the success of the enterprise. Knowledge of them should be as mandatory as functional knowledge in marketing, finance and manufacturing. Only then will the use of IT to address these concerns move from a "technology push" driven by the IT group to a "demand pull" from people across the organization, which will ensure that the company’s IT services are strategically aligned with its business and that capital won’t be allocated for expensive and unnecessary IT services.
4. Make sure nothing gets lost in translation. A company must have people at all levels who can translate IT language for those outside that department and translate the language of management for those in IT. Some of the greatest mistakes in the use of IT occurred in the late 1990s when CEOs bought into IT initiatives and IT-based business models blindly without bothering to truly understand what the technology could and couldn’t do. At the same time, IT staff should have a clear understanding of the business role and value of their work. This should include awareness of the costs and benefits of systems, applications and operations, and an understanding of the interdependencies of IT and other resources within the organization. Including IT personnel in business planning and control committees, task forces and cross-functional teams, as suggested above, and similarly, having non-IT managers on IT planning committees, can facilitate this.
5. Rationalize IT spending. The planning of IT expenses and investments should be subject to the same rigorous procedures and methods as any other expenditure. Too often, executives sign off on IT spending without a clear understanding of its business value. To ensure that all IT spending makes sense for the business, the executive management of the firm must institute proper IT governance—that is, ensure that every part of the organization that is affected by IT decisions is part of the decision-making process, and that decisions are made at the highest levels with a full understanding of all their implications.
6. Create an IT portfolio by evaluating risks and returns. Just as an investor balances risk and returns in constructing a portfolio of investments, management should analyze the costs, benefits and risks of all IT projects to determine how to get the most benefit from the dollars invested in technology. There is a myth that IT investments can’t be evaluated because many of the advantages are intangible or can’t be monetized. While such uncertainty often is part of the equation, thoughtful analysis of the costs and benefits of IT projects can still lead to greater confidence in the value of these projects.

I think that the author make an excellent point. Much of the IT failures I’ve seen and been a part of have results, not from bad technology, but rather from the poor management of technology. As much as IT is responsible for the effective management of technology for the business, the business function also need to take responsibility for holding IT accountable for the value they deliver, just as any other business function.

 

Technorati Tags: Alignment, Governance, IT, Technology, Strategy, Management, Leadership

The 2008 "State of the CIO" study is highlighted in the article "Information Technology Budgets: Which Industry Spends the Most?" provides some useful statistics on spending by industry.  The 2008 State of the CIO asked IT leaders about their budgets, and how many users they have per IT employee.
 

Industry	IT Budget as a Percent of Revenue	Users per IT Staffer
Financial Services	10.5	15.7
Government	7.8	37.8
Employee/former employee	6.2	48.3
Health Care	5.0	25.4
Wholesale and Retail	3.9	47.5
Manufacturing	3.4	40.9
Overall Sample	6.7	35.1

SOURCE: 2008 "State of the CIO" survey of 558 heads of IT. NOTE: Survey respondents in financial services, government, health care and wholesale/retail industries said they expect to be hiring IT staff in the next 12 months.

How does your organisation’s IT spending stack-up?

 

Technorati Tags: Spending,IT,Strategy,Management,Cost,Benchmark,Finance

Strategy+Business celebrate their 10th anniversary by looking back at the conceptual breakthroughs that appeared in their magazine and their readers voted on which they felt were the most likely to last, the result is "Our 10 Most Enduring Ideas". The qualities of these enduring ideas has five key qualities:

1. It is timely: It addresses, in a new, compelling way, an issue that is important to people right now.
2. It has explanatory power: It reveals the hidden patterns and interrelationships that shape the phenomena we see, and that other theories or disciplines have not fully explained.
3. It has pragmatic value: It can be put into practice to produce replicable results.
4. It has a robust empirical foundation: It can be tested with real-world experience, and ideally with measurable data, and can survive theoretical challenge.
5. It has a natural constituency: A group of key people are ready to hear it.

 

The top 10 enduring ideas voted for are as follows:

1. Execution - "It’s not your strategic choices that drive success, but how well you implement them. As Larry Bossidy and Ram Charan pointed out in their book Execution, the most critical quality for managers is the ability to put ideas into action." - Related Articles: Larry Bossidy: The Thought Leader Interview, Ram Charan: The Thought Leader Interview
2. The Learning Organization - "A learning organization is one that is deliberately designed to encourage everyone in it to keep thinking, innovating, collaborating, talking candidly, improving their capabilities, making personal commitments to their collective future, and thereby increasing the firm’s long-term competitive advantage. In putting forth this idea, we invoked such influential authors as John Seely Brown (The Social Life of Information, The Only Sustainable Edge); Arie de Geus (The Living Company), and Peter Senge (The Fifth Discipline, Presence)." - Related Articles: Arie de Geus: The Thought Leader Interview, “The Living Company? by Arie de Geus, An Interview with John Seely Brown, The Fifth Discipline: The Art and Practice of the Learning Organization
3. Corporate Values - "Companies that care about ethics, trust, citizenship, and even meaning and spirituality in the workplace (or that simply articulate their values carefully) perform better in the marketplace than companies that care just about ‘making money.’" - Related Articles: Why Bad Things Happen To Good Companies, The Value of Corporate Values, Daniel Yankelovich: The Thought Leader Interview
4. Customer Relationship Management - "The cultivation of long-term relationships with customers, including awareness of their needs, leads to highly focused, capable companies that try to make consumers ‘part of the family.’….. One fascinating qualification came from correspondent Malcolm Wicks: ‘Being customer-centric is not the same as CRM, which is more likely to be sales-centric. Being customer-centric is all about doing things that most benefit your targeted customers, even when there is no direct benefit for your company. As everything gets more commoditized, companies that are most customer-centric will be the most successful.’" - Related Articles: How the Auto Industry Should Embrace CRM, A New Window onto CRM Success
5. Disruptive Technology - "As Clayton Christensen noted in The Innovator’s Dilemma, technological innovation radically alters markets by undermining incumbent companies — which are vulnerable because their offerings are all tailored to the needs of their existing customers……… Professor Christensen’s idea lives on, to an extent, because of its two-part form. First, there is a warning: Your most cherished policies and practices — in this case, the hallowed sanctity of a successful customer relationship — can include the seeds of your undoing. Second, there is a way out: Preempt your own comfort zone, adopting a disruptive technology yourself before others beat you to it." - Related Articles: Clayton M. Christensen, The Thought Leader Interview, Top-Down Disruption
6. Leadership Development - "You don’t have to rely on ‘putting the right people in place.’ You can train all employees to be better choosers, better strategists, better managers, and in the end, better leaders…… Companies can be both more effective and more responsible with smart leadership development practices in place (several people referred to emotional intelligence in this vein). Leadership is important, not because of the leaders’ actions in themselves, but because of the actions that everyone else takes on their behalf." - Related Articles: Can We Really Train Leadership?, Noel M. Tichy: The Thought Leader Interview
7. Organizational DNA - "Leaders can design an organization’s structures — incentives, decision rights, reporting relationships, and information flows — to induce high performance by aligning them with one another and the strategic goals of the enterprise. Elucidated in the book Results, by Gary L. Neilson and Bruce A. Pasternack." - Related Articles: The 7 Types of Organizational DNA, The Four Bases of Organizational DNA, The Cat That Came Back
8. Strategy-Based Transformation - "Beyond the ‘blank page’ of reengineering, this is the redesign of processes and organizational structures, and the consequent cultural change, to fulfill the strategic goals of the enterprise. In an ideal universe, this would not even be a management concept, because, as one correspondent put it, ‘All company activities should be aligned to the enterprise strategy.’" - Related Articles: Symantec’s Strategy-Based Transformation
   Customer-izing the IRS, 10 Principles of Change Management
9. Complexity Theory - "Markets and businesses are complex systems that can’t be controlled mechanistically, but their emergent order can sometimes be anticipated. An understanding of the ways that complex systems evolve can help managers intervene and act more effectively. Over the years, complexity theory has come to mean a family of related, but sometimes contradictory, theories — including chaos theory, artificial life, probability theory, and even system dynamics — of intricate and nonlinear systems in which so many elements interrelate that the effects appear random and unpredictable, even though it is possible to trace patterns of causality and probability." - Related Articles: Between Chaos and Order: What Complexity Theory Can Teach Business, Complexity Theory: Fact-free Theory or Business Tool?, Power Laws & the New Science of Complexity Management
10. Lean Thinking - "This type of process and management innovation is exemplified by the Toyota production system. Employees use a heightened awareness of work flow and demand to cut waste, eliminate cost, boost quality, and customize mass production." - Related Articles: Flextronics: Staying Real in a Virtual World, Leaning Toward Utopia

 

I think that this is a great list of ideas. As a strategist are you familiar with the ideas and concepts described above? Which of these are you actively implementing in your organisation?

 

Technorati Tags: Strategy, Ideas, Business, Leadership, Management, Research

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