Tuesday, February 9, 2016

Nine Principles to Run a High-Effective Digital IT

The successful enterprises have IT systems that are not cumbersome but enabling and catalyzing.

Business paradigm is shifting from an industrial era to an information/digital era, technology plays a pivotal role in such a transformation, and it is penetrating into every core process of the organization; companies that lacked the skills to manage information technology effectively suffered compared with competitors that had mastered those skills. The successful enterprises have IT systems that are not cumbersome but enabling.  Enablement through unobtrusiveness is what drives innovation and the improvement in the ability of the enterprise to learn and grow as an entire organic system. But, more specifically, what are the principles to run a high-effective digital IT?

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. 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 and unify processes across functional boundaries, and often across the entire enterprise.

Listen, listen, listen and listen some more: One of the biggest obstacles to running a high-effective IT is the disconnect and misunderstanding between IT and business with “he said, she said” scenario. IT needs to be an integral part of the business, thus, IT folks need to listen, and listen more. IT is first and foremost about serving the customer. Develop an IT culture of customer centricity. Communicate IT performance in business-relevant language. IT resources have to be focused on providing excellent customer services and customer expectations need to be clearly understood and monitored regularly.

Do not let best practices destroying the values: IT needs to establish the right set of principles, as well as develop and continuously update the best and next practices. However, what is the best yesterday will not be best tomorrow. The bottom line is "best practice" which is a benchmarking tool and only true for the time and given environment. Taking a best practice from one environment into another could turn out to be the worst practice, as so-called best is now out of its benchmarking context. Further, best practices usually only focus on process efficiency, about know-how, not get broader thought about process effectiveness, dig through why, today's process is no longer isolated, it's interrelated with the latest technology and the best talent, the path to excellence is to think more closely about business goal, iterative communication, and the multitude of choices.

‘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. Certainly the “KISS” principle (Keep it simple stupid!) is one to follow wherever possible to either run an IT project or manage IT as an overall business discipline.

SMART principle: 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. If you follow the "SMART" principle then you won't go far wrong - Specific, Measurable, Achievable, Relevant and Time-based. Fortunately, that's what computers are for - to take the grind out of complex calculations. Metrics is the obvious method for measuring quantitative objectives. However, it is important to have criteria for rating qualitative objectives as well to answer the question: what does it mean to achieve the KPI? Indicators should be very flexible. Every relevant indicator should be synchronized and arranged logically. First measure the right things, and then measure them right. Measure IT in business terms: "Do not just measure the cost of IT but all the return that it provides." Companies that invest heavily in IT should be careful at analyzing the costs associated with this investment as the savings are often buried within the operational side of the business.

Agile needs more engineering discipline, not less: Agile is emerging as a mainstream software project development methodology, the best advantages it brings include interactive communication, iterative delivery and end customer satisfaction. Agile takes more disciplines, not less. Engineering practices are the core. Everything else is built on that. You achieve the ability to be agile in your software development by following engineering practices that allow you to adapt as efficiently as possible. The benefits of agility are not sustainable unless engineering practices are adopted in the earnest. So while practices related to business analysis and project management will yield quick wins, the optimal level of benefits and impact come in only when engineering practices are adopted.

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 do innovations happen and who are 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 better solution to the problem on hand and business challenges in the long run as well.

The principle of doing IT procurement is the same way you do the rest: centralized, decentralized or hybrid: Ultimately whether something is considered "better" or "worse" means that it must have some criteria and standards against which it is being assessed. All businesses focus on ultimate and strategic objectives if there is any vision or strategy at all in your business. Digital is also the age of cloud, it means the variety of options to run IT via building, purchasing or anything in between. Whether you have a procurement organization or if IT handles procurement, its effectiveness can only be assessed as "better" or "worse" based on how it achieves those ends.

Never stop managing IT risks: The "VUCA" nature of digital dynamic brings both the abundance of opportunities as well as unprecedented risks to the business. CIOs must understand the fundamentals of the environment and engage key decision makers and stakeholders on their terms. Foster a governance process to ensure key stakeholders have input into planning, allocation, and commitment of resources. IT Governance is a vector of quality, for both the maturity of process and outcome. Eventually, as the company grows, so will the need for standard policies and procedures. Not just to cover the “risk” management, but to create a risk intelligent environment in which IT innovation can excel within the constraints of the hierarchy of the organization.

IT needs to focus on the fundamental business principles, not overly rigid rules to run a high-effective and high-performing IT in the digital era. So IT can take more resource to do innovation, not just an over-controlling support function to keep the light on; and the most important thing is how to build the trust relationship with businesses, practice governance with agility; build order over control; prioritize people over process and ensure the business as a whole over functional silo, to play a decent role as a technical advisor, data steward, customer advocate, governance champion, and even more.


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