Monday, January 25, 2016

Five Principles to Run a Digital IT

Setting guiding principles is not to manipulate (HOW), but to clarify (WHY).

Principles are statements of values. Things that define why one make a decision one way or another. These core decision values guide the behavior of individuals within an organization. Digital does flatten  the organizational hierarchy and blur the functional, organizational, and geographical borders in the business ecosystem, it could mean less restrict rules or bureaucracy, but it also means the guiding principles become more crucial  to be defined as core decision values and behavior guidelines. It is less about controls, but more about the clarity of  "why we make decisions the way we do” and what’re the expectations of employees' work performance.  From IT management perspectives, guiding principles let the organization know what to expect when dealing with IT, and serve as a yardstick by which to measure IT internally and externally, and can spur some great discussions with fellow C-suite members and business unit management. Here are five principles to run a digital IT organization.


One Size Does not Fit All: The CIO has to be able to navigate the business objectives and corporate strategy, and lead the creation and execution of the corresponding technical strategy for the company. A lot depends on the corporate structure and the culture of the company. Should IT be completely centralized, or embedded into business units to a certain degree? Should IT put more focus on internal users or end customers? Should CIOs act more as a Chief Innovation Officer or a Chief Intelligence Officer? When should IT take the orders, and when should IT be a game changer to drive changes?  There is no one size fits all solution, though. Thus, IT leaders need to have the ability to think analytically and synthetically to set IT principles right and manage business solution via high-performance IT team; build the strong business orientation & ability to bring the benefits of IT to solve business issues; cultivate the ability to align the business requirement with the IT capacity. It means that the CIO is able to constantly and dynamically lead an IT structure that will seamlessly support the business and well ahead of the business requirement; the ability to interact with business in their processes and pain areas, the ability to bring out a customer-tailored and technology driven solution, driving adoption of applications, be the spinal cord for the organization - integrating various departments, to simplify & unify processes across functional boundaries, and often across the entire enterprise.


“KISS” Principle:  “Keep it Simple” is one of the most important principles and agile philosophy to run a digital IT, though by its nature, IT is complex, it doesn't mean IT should continue to complicate the matters or increase unnecessary complexity without disciplines. Simplicity is a behavioral attitude to see things as and what and where they are and be content and cool as it is. Complexity arises not from nothing. Humans create, though unintentionally in most cases their own problems. Therefore, they have to untie the knots they made themselves, how could you shoot the tangles to see from the different angle, how could you leverage creative thinking to discover the alternative way for problem-solving, and how could you apply Systems thinking to manage complexity via consolidation, optimization, integration, modernization, cloudification in IT management scenario? There are still layers of complexity in simplifying, but you know the elegant solution when you see it.


“SMART” Measurement Principles: Simplicity is surely important, but at times there is a need for complexity in the right place to incorporate the right elements in the calculation, to make the KPI a true indicator of performance. Fortunately, that's what computers are for, to take the grind out of complex calculations. If you follow the SMART principle then you won't go far wrong - Specific, Measurable, Achievable, Relevant and Time-based. First, measure the right things, and then measure them right. From a business management perspective, IT is business, thus, IT measurement needs to have a strong business focus, not only via the metrics to keep systems on but also via the lenses of business growth and innovation. Irrespective of whether the KPI is simple or complex, the selection of KPIs should be done regarding these three criteria: relevant, clearly defined, and balanced (‘RDB’ Criteria),  KPIs need to be specific and measurable and, therefore, logical. It very much depends on how much data you already have. KPIs are normally set based on historical data, benchmarking with other companies either internally or externally or through time and motion studies to determine a baseline. Do not just measure the cost of IT but all the return that it provides.


Doing More with Innovation: The popular IT mantra in the industrial era is “Doing more with less.” But digital is the era of innovation, “doing more with innovation” needs to be one of an important IT management principles to improve the organizational competency and maturity.  Why innovations happen and who is the strategic partners to drive innovation? Innovations happen because of specific business needs. Unique challenges become more appear as we push the limits of the available technology, which pushes us to find a solution to the problem on hand.  Either disrupt or being disrupted. IT is at an inflection point to lead organizational level digital transformation because it is in the unique position to oversight business processes and processes underpin business capabilities. IT is the key element of business innovation capability, either for catching customer delight or achieving business optimization. IT innovation capabilities directly impact how it helps the business gain competitive advantage and capture upcoming trend to compete for the future. Information technology should be seen by any business as a “digital transformer and focus on VALUE proposition to run a digital IT.


DO NOT let “Culture Eats Strategy for Breakfast”: There are many different perspectives of culture are presented along with diverse ways and means of dealing with it. Smarter hiring practices and attendance to daily and measurable healthy workplace culture dramatically decreases the need for control and excessive or restrictive policies. Experience between positive performing cultures and mediocre or negative cultures is that they evolve from the platform of trust and respect that cascades from the top. IT plays a critical role in fine-tuning business culture because IT enabled digital processes and platforms can help to bridge silo thinking, keep information flow, and harness cross-functional communication and collaboration. Regardless who is setting the principles, to maintain the positive environment, a set of guiding principles can be written on a page. It will be supported by the bulk of employees in defining the boundaries they also wish to maintain.

So setting guiding principles helps IT leaders provide greater clarification of mission / vision / strategy at a more detailed level. Setting guiding principles is not to manipulate (HOW), but to clarify (WHY);  the guiding principles frame the right questions to ask, not just about searching answers only. There needs to be a pragmatic way of applying whatever principles to the problem in a consistent manner, otherwise, it is a waste of effort to even state them. Principles, Processes, People, Practices, Performance, etc are all critical factors to run a high-performance digital IT.

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