Saturday, October 29, 2016

"CIO Master" Book Tuning #131: Three Practices in Achieving IT Management Excellence

IT management excellence is one of the most important pillars for running a high-performance digital IT organization.

With the fast pace of changes and overwhelming information nowadays, Information & Technology are permeating to every corner of the business, often IT can either make or break a company almost overnight. IT strategy is an integral component of the business strategy, as more often than not, technology is the driving force behind business innovations. The history reveals that IT needs to be understood and harnessed by all stakeholders, to fulfill its potential and strategic importance as a differentiator of companies. A seamless digital journey is made of many solid steps, how to develop a set of next practice for achieving IT management excellence and improving organizational agility?

Prioritization Practices: Majority of IT organizations are often overloaded and understaffed, and get stuck at the lower or mid-level of maturity. They are always struggling with “doing more with less,” or “taking orders from customers without doubts.”  A company has finite resources to apply to get the best yield possible to meet stakeholders’ expectation. So there’re always some constraints for businesses to balance a healthy portfolio of “run, grow, and transform,” to explore the new opportunities or deploy the new ideas. Therefore, evaluation and prioritization are taken place to leverage resources in management. Prioritization is critical, as the alternative is a land grab for resources. Prioritization helps to focus the strategy of the organization, which has huge benefits in terms of execution. Since the projects have different investment considerations and business goals, for example, digitizing touch point of the customer experience is to delight customers and improve customer retention; designing new tools is to help improving employees’ productivity; risk reduction for maintenance work, ROI for tactical and some strategic work, and organization learning measures for true innovation work. So the business objective shouldn't be to work on only those projects for which you have staff, it should be to maximize what you can accomplish through creative leverage of your talent pool. In addition, prioritization brings transparency to the organization, creating internal competition among new ideas and projects. Prioritization forces people to be more creative, to come up with better ideas, and manage them in a structural way.
Cost Optimization Practices: Thoughtful cost cutting and investment with an eye towards the future is the continuous practice of a well-run company, this is particularly true for IT, because of frequent technology update and costly IT investment. All of IT spending must be looked at through an investment lens. Mistakes are made when the all-in value of a business line (including technology) is not taken into consideration when making budget decisions. IT management should check periodically via asking: What returns are you expecting? When do you expect them? What risk levels are you taking on? Scrutinize every expenditure and ask if it can be done more cost effectively. Renegotiate all maintenance contracts; using demand-side analysis with TCO shifts from technology budget to business budget discussions, to ensure that technology spending is in line with the business strategies and objectives. From staff management perspective, take advantage of re-aligning staffing by having a more flexible talent management. When a CIO is able to position and maintain the IT organization to ensure it addresses both "IT effectiveness" and "IT efficiency," they have earned their stripes.

Simplification Practices: By nature, technology is complex, every intelligence has complexity behind it. However, it doesn’t mean IT should make things more and more complicated. In fact, “Keep it Simple” should always be one of the guiding principles and management culture for running IT to achieve operational excellence. Logically, simplifying the complicated thing is an optimal and smart choice,
Simplicity brings speed, clarity, flexibility, and productivity. IT management is in the continuous tuning mode through consolidation, modernization, integration, and optimization, streamline IT processes and tighten coordination with vendors and partners. Re-plan any project or undertaking via Agile methodology so that there are deliverables that provide benefit to the business at the shorter delivery cycle. Run, grow and transformation, simplify unproductive complexity and streamline limited resources on higher prioritized projects to make competitive business advantage.

IT management excellence is one of the most important pillars for running a high-performance digital IT organization. IT leaders should remember that IT is about the Information, and focus on being a solution-driven organization, innovation engine, and run IT as a business, rigorously identify and pursue business value via setting the right priorities, keeping things simple, and making continuous optimization.


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