Mark McDonald

Amplifying the enterprise is the theme for this year’s CIO agenda reflecting the expanding role of technology in the enterprise and its role in raising the power of enterprise strategies and performance.  The notion of technology as an enterprise amplifier goes beyond traditional notions of IT and the administration/automation of back office processes.  Technologies such as mobile, cloud, analytics and social provide executives with ways to transform the customer experience, products, channels, services and operations.

Having a theme is good, but putting that theme into action is much better.  This post offers a simple tool for assessing the degree to which technology amplifies the enterprise.  The tool is a simple matrix, shown below, consisting of four parts.

• The business strategies your organization is pursuing.  These make up the row and column headers of the matrix.
• The technologies your organization will use in executing these strategies.  These make up the diagonal cells, shown in black in the figure below.
• The amplifiers that represent the direction and guidance needed to achieve the strategies.
• The distortions representing decisions, approaches or direction that will detract from the strategy

These are organized into a matrix that provides a quick view on the connections between strategies, technologies, amplifiers and distortions.  This matrix is a little different in that it concentrates on the relationships between strategies rather than between strategy and technologies or projects.  This view is deliberate and helps highlight the interdependences among the various elements rather than trying to isolate one aspect against another.

Creating the matrix involves the following steps:

Start with the business strategies and use them to populate the row and column headings.  Because you are looking for business results, you need a matrix that takes strategies and compares them against other strategies. This is important as amplifying the enterprise involves achieving strategic objectives in combination rather than isolation, particularly in terms of the use of technologies like mobile, cloud, analytics and social.

Next put the key technologies into the diagonal cells to connect technologies with specific strategies. Focus on the technologies that you expect to have the greatest impact on the strategy.  Just the vital few so that it is easy to see why you are investing and paying attention to a particular technology.

Now in the white areas describe the amplifiers or the things you need to do to accelerate achieving both strategies. Remember amplification is strategy in combination, so what are the things you have to get right in order to achieve two strategies, particularly in the context of the technology.  Avoid listing the projects, programs or completion of tasks in these areas.  You already have ways to manage that and besides saying “complete the implementation of mobility solutions,” says nothing about the qualitative aspects of doing that right.

Next, in the red areas list the things you need to avoid, the actions, directions of mindsets that hold back results.  These are the distortions that hold back your strategy.  Focus on the things that inhibit the various strategy combinations.  Do not list ‘doing a poor job’ as a distortion as that is obvious.

Finally, look at the cell values and ask yourself if the amplifiers look right, the distortions capture the things you might get wrong and can you explain how the technologies contribute to the strategies, enhance the amplifiers and will eliminate the distortions.

The figure below provides a worked example of the tool based on the top three business strategies found in the 2012 CIO Survey.

Creating an enterprise amplifier involves more than building the right technology.  It requires executing the combination of strategies and technologies in the right way.  The information in the amplifiers cells seeks to capture that information as well as the distortions to avoid.  Taken together, this single simple matrix provides a way to look at the interaction among strategies, technologies, amplifiers and distortions that represent the interconnected nature and complexity of an operating enterprise.

I would suggest creating this tool as guidance for strategy planning, execution and ongoing management processes to keep everyone focused on the same result – amplifying the enterprise.

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Category: 2012 Amplifying the Enterprise Strategic planning Strategy Tools     Tags: 2012 planning, amplify, IT and Business, Strategy, Strategy and Planning, Tools

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Every business book you read says that you need to have ‘executive sponsorship’ for any major initiative.  Fail to involve the executives and you are likely to fail.  That advice has become so prevalent that it is almost worthless.  Getting executive sponsorship is not what matters; it’s the quality of the sponsorship that makes all the difference in the world.

Really?

I had the honor of reviewing a transformation program and providing a health check.  The program is ambitious; technology intensive, process demanding, and can truly redefine the rules of the industry.  But there is a catch, the transformation program had progressed to a point where it had raised serious business issues, but the program and its sponsor did not have the authority to answer.

Sitting at this crossroads, the teams did what they could, keeping busy until there was a decision from the executive level.  The health check became necessary as the program sat stalled for more than six months and instead of creating pressure for decisions, it created calls to cancel the transformation.

It was clearly time for the executive team that sponsored the effort to step in and make some hard choices.  In the report recommending that action, among other recommendations, the Executive Team came back with the following reply:

“Why are you not telling us more about IT and where it has failed?  Why are you talking about where they are going wrong?  Why are you saying that we need clearer business direction, your just covering for IT and their failings.”

When I pointed out that there were several highly critical points in the report related to IT, which had little effect.  All the executive team heard was that there needed to be more business direction.  Their reply:

“If you say we haaave to be involved then please know that we are tired of having to make every decision.”

I was not surprised.

I was stunned.

Here was a major multi-multi million-dollar transformation program that had done the work, found the tough issues, gone as far as it could and now needed active executive sponsorship in the form of some hard decisions to go forward.

The executive team commented that their job was to be ‘above all of this’, to think strategically, and to be visionary rather than making operational level decisions.  The only problem was that the open issues were not just operational; they were strategic in the sense that the answers would determine the performance profile of the company in the future.

As I reflected on the meeting a few things became clear.

• The executive team assumed that saying it is should be so is the same as making it so. “We said yes, so we consider it done.”

• The executive team did not see making hard decisions as an expression of their leadership.  They wanted to remain ‘above it all’ and not create winners and losers on an issue.  They believed that you demonstrated leadership by guiding without getting their hands dirty.

• The executive team was ready to criticize the decisions or direction others had taken but they did not have the time, energy or political will to lead in creating that future.  “I can tell you what your did wrong, but its not my job to help you make it right.”

• The executive team did not welcome evidence to the contrary nor recommendations on how to move forward that required their active participation.  I will listen if you confirm my suspicion, your motives are suspicous if you do not say what I expect to hear.

These reflections give the impression of an incapable executive team.  But that is not the case, this team runs one of the most successful, global, industry leading companies in their market.

So what gives?

These executives were giving the level and type of sponsorship that had worked in the past.  Their responses, comments and attitude was appropriate for the type of relatively incremental, back office, administrative changes that have dominated the executive agenda for the past 10 years or so.

The level of sponsorship that worked when we talked about IT.

While the quality of that sponsorship was fine for then, it is totally in appropriate for the types of changes we are doing now.

The level of sponsorship required when technology becomes greater than IT.

Executive sponsorship needs a significant upgrade as the demands for transformation have outstripped current sponsorship models.  Enterprises are going through real and deep change, like this one, requires direct executive action, decisions and direction.  Not delegation.

If figuring out how your business needs to operate to create value is not part of the executive team’s job, then I do not know what is.

What are the changes, if any, you are seeing in the type, nature or level of executive sponsorship?  Not just for technology, but for any transformation.

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Category: 2012 Change on the cheap IT Governance Leadership Management Personal Observation Signs of weak management Strategy     Tags: 2012 planning, amplify, Leadership, Management, Personal Observation, Signs of weak management

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Last week I had the honor of being on a panel at the launch of the European Citizens Initiative (ECI).  The ECI represents an innovation in the relationship between citizens, the government and representative democracy.   Social media is at the center of the initiative representing one of the first formal ways in which social media technology is recognized in legislative process.

The ECI provides European Citizens the ability to present legislative initiatives directly to the European Commission provided they have a million signatures from EU citizens in a representative set of countries. Links at the end of this post provide the details.

Rather than creating a large and complex program, the ECI’s basic structure revolves around open source software supporting registering an initiative and submitting signatures for validation.   That may not sound like much, but in an environment of social media and technology it gives EU citizens the basic interfaces to engage the formal structures of the European Commission and the rest is up to them.

In preparing for and participating in the panel a number of thoughts came to mind on the nature of technology, public policy and the future of direct citizen participation.

• The ECI is correct in conceiving of social media as the ‘technology’ for creating an environment for the initiative. Incorporating social media into the citizen centric strategy not only recognizes the reality of social media in society, but also encourages direct citizen action and innovation without prescribing a platform or approach.

• Social media platforms, like Face Book, Google, Twitter, etc. provide a platform with the scale and reach necessary to engage the large and diverse EU citizenry.

• Social media’s communications capabilities are well suited for sharing the depth of information associated with a strong citizen initiative.  I can imagine these sites holding more than just calls for support.  These sites can become key educational, documentation and discussion sites.  Imagine video’s that document conditions and situations, position papers that outline aspects of the initiative and debates where the community forms and reforms the initiative prior to its submission.  Those are the types of collaborative capabilities that can drive strong, positive and participatory policies and initiatives.

The open, participatory and self initiated aspects of social media tools match up well with the principles associated with the ECI.  These same aspects have the potential to change the nature of public discourse, government transparency and the like.  A few thoughts in these areas include:

• Social media in public policy can change the nature of policy development toward building solutions rather than supporting stances.  This creates the potential to shift the policy development process from a basis of exchanging single issues or interests based views to multi-lateral working discussions to craft an initiative prior to the ECI process.  This has the potential to change the nature of NGO’s and other policy influencers moving them away from advocacy for a position toward collaborating to solve a problem.   Call me naïve, but if all social media does is raise the volume of single interest, single views then we are poorer for it.

• Changing the level of transparency and participation in EC/EU deliberations concerning successful initiatives.  The current process, as I understand it, involves closed deliberation and consideration of initiatives that complete the ECI process.  I believe that the participation and transparency required for the front part of the ECI process, will lead to similar requirements in the deliberation and decision making of policy makers to not only use the content generated in the initiative process but also to engage the community in deliberations and discussions.  It is hard to open the front end of a process and make it more transparent and keep the back end closed.

• The ECI can be seen as part of a range of legislative processes and approaches.  Viewed in this context, the ECI plays an important role in submitting initiatives that should compliment rather than compete with other approaches and channels.   Recognizing the uniqueness of the ECI process should allow it to have different features and performance expectations as not every process is best to address all policy challenges and issues.

• Much of the ECI process will be ‘do it yourself’ in terms of citizens taking direct responsibility to organize, discuss, debate and develop their initiatives and tools.  There are few prescribed rules for the ECI, which opens the door for creativity and innovation in the policy development and debate process.  Sure it would be nice to have prescribed content policies, platforms, and premade tools as some at the meeting asked for, but such pre-structuring of the environment can also pre-structure the nature of the debate and set operational limits.  A practical and innovative way of being neutral is to be open and lay down a few clear rules, processes and tools which the ECI has done.

The ECI has many of the characteristics associated with successful mass collaboration. We identified these characteristics in researching how large organizations apply social media to achieve meaningful results for the book, The Social Organization.  Having a compelling purpose, just enough structure and the right level of sponsorship are all critical for success.

The launch of the ECI last week represents the first mile in a new approach to direct citizen involvement in the legislative process.  Submitting legislation is also the last mile for many in the policy arena as ideas turn into proposed rules and laws. How these two connect and collaborate using social media is something I look forward to observing in the future.

Related links

European Citizens initiative Web Site

European Citizens Initiative Face Book Page

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Category: Innovation Personal Observation Social Media Social Organization Technology     Tags: government, Innovation, Personal Observation, Social Computing, social media, Social Organization

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What is one of the hottest roles in IT?  What is the role that is in demand and will play a critical role in the future?

I believe it is the business analyst.

But not the type of business analyst we have today.  That type of business analyst was a junior position in IT.  The one responsible for gathering requirements from their business peers.  The one focused on building application solutions and contributing to projects.  The role provided an entry point for new hires into IT.

I started my career in IT as a business analyst in part because a business analysts did not have to be a technician, they could learn the technology while working with the business.  Methodologies and IT processes supported this type of business analyst by defining formats, tools and techniques for requirements gathering and analysis.

This type of business analyst is still required, particularly in consulting and service provider organizations where the focus is on implementing new solutions.  That role is diminishing in captive IT organizations that need greater experience, knowledge and context to create value in today’s complex, cost conscious and cycle time driven world.

CIOs are rebuilding the business analyst role, not as an entry point for new hires but a leverage point for experienced IT professionals.  These CIOs are redeploying experienced I&O professionals, developers, managers etc. who are able to translate what they know into the best way to move the organization forward by building on and adapting what you have rather than always requiring developing a new solution.

CIOs need experienced business analysts because the nature of IT project decisions is changing.  Traditionally the major business decisions revolved around budget authorization for projects.  Secure the budget and the focus moves to starting the project as business analysts get to work completing requirements.

Increasingly, enterprises and CIOs do not have the resources or time to continuously create new solutions.  This changes the role of business analyst from introducing new solutions to solve issues toward a greater emphasis on redeploying existing solutions to new issues.  The value proposition for business analysts with the experience, ability and interest in reuse is strong. Reuse not only reduces risk and cost, but also reduces cycle time by up to half.

An experienced professional as business analyst has the ability to thrive in this environment as they have one or more of the following characteristics:

• They know if the company has addressed a similar business issue in the past and the potential to reuse those solutions to fit new situations.
• The actual structure of information, interfaces and relationships between systems.
• The real performance of existing applications, data and infrastructure, providing a more accurate assessment of capacity, performance and
• Prior change requests and updates to applications
• Vulnerabilities, risks and weaknesses that may be exacerbated by the new solution.

Not every experienced IT professional can make the transition to becoming a business analyst.  The new business analyst has to be solution focused; in the sense that they are looking for ways to make things work rather than focusing on all the ways it cannot work.  Fortunately it is relatively easy to figure out if someone is solution focused.  Simply ask the following question:

We want to do “X” in the business.  What do you think?

Then listen to their response.  If they talk about how it would not work, could not work, or how poorly positioned the company is, then they are not solution focused.  On the other hand, if they start to discuss how it might be possible if we change X, Y, Z etc., then you have found someone who is looking to create solutions.

Re-building the role of business analyst creates new capabilities for amplifying the enterprise based on recognizing the value of experienced and solution focused IT professionals already within your organization.  Moving from a requirements focus to a solutions focus is an essential part of that transformation both for IT and for the analyst role.

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Category: 2012 Amplifying the Enterprise Leadership Re-imagine IT     Tags: 2012 planning, IT organization, IT Roles

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Value creation and innovation come from thinking in new ways about organizational offerings.  Over the last 50 years there has been a progression from offerings based on products (things that you use in your life), to those based on selling solutions (products that we use for you) to selling services (that you incorporate into your value chain).  That progression, shown in the figure below, begs the question – what will we have next?

That is the question business leaders are working their way through.  We already know a few things as we try to define a world ‘beyond service’.  Here are a few things that I believe we will need to incorporate.

• It will have a deeper connection to the individual, their goals and needs
• It will be delivered via a blend of communications and computing technologies
• It will have a social component
• It will support customer self expression
• It will incorporate location and condition into its value proposition
• It will evolve rapidly
• It will not fit into any readily available category
• It will require significantly more and different data then we have now, used in different ways
• Suppliers will not define it so much as by a consensus of consumers and interested parties.

So what do you call something that is personal, technological, social, customizable, unique, informational etc.  The name is something that goes beyond a product or service, or product/service, or even the notion of ‘prosumers’ advocated by Don Tapscott.  It’s more than a facility or a platform like Facebook or your bank.

One way to think about it is to call it a “SITUATION.”

Situation could be the term for a new set of offerings that create value in the world of digitized, social, networked, personal, peer influenced world.  The idea behind a situation is to capture something that is more than providing a ‘service in context’ that type of smarter approach may be a stepping-stone, but it still more about using information to slot customers into predetermined service scenarios than really addressing the situation.

Why do we need a designation of something beyond service?

Service replaced the idea of solutions as customers wanted to leverage our resources, assets, knowledge and products into extending their value propositions.  Services freed companies from having to replicate functions that were not essential to their value creation – think FedEx or UPS in logistics, Credit Cards in Accounts Receivable etc.  These services quickly came together and are now a standard of competitive strategy.

But what happens after you give people services?  You could sell them smaller services or integrate services into larger bundles or you could think of what is the next addressable frontier in terms of creating unique and sustainable value.  Addressable expressed in terms of the ability of business and technology infrastructure and substructure that makes it possible to do something new or at a price point or at a scale or at all three that was not feasible before.

Take the characterizations mentioned above and you can think of situation as the totality of them rather than simple combinations.  Some will say so what, are not the following forms of situation:

• Context or ‘smart’ situations = service + information analytics (data, Bi)
• Location situations = service + device location information (foursquare)
• Social situations = service + social media (web casts, move on, etc.)
• Event situations = service + social media + location (concert or flash mob)
• Etc.

Yes, but we need to push beyond that, because when we do we get a definition of something that is unique to the individual and therefore a source of unique value and competitive advantage.

A situation is about a broader definition of customer need.  Need in terms of a situation exists at a point, place, condition, emotion in time.  While that comes and goes and no one is ever the same, situations are commonly understood, think situation comedy or the phenomenon of schadenfreude and you get the idea.

People are already trying to integrate and support situations on their own

You can already see situations forming as people surround themselves with sets of disparate but related technologies to build support for their situations.  Recently I was out with my son, who is working on the east coast.  We were driving in his car, his GPS was plugged in, his cellphone one, and we were running errands based on recommendations he received from Yelp!

The idea of situation as something beyond service became apparent when we changed plans, the situation changed and the value of our prior plans and preparation dropped considerably.  I would up, reassembling the situation on the GPS (new location), the phone (Texting people) all based on new recommendations from Yelp! Accessed via the smart phone.

Thinking about the future of value creation beyond service opens the door to new competitors, value propositions and opportunity.  So as you put your strategies and plans to the test for this year and the next five years or so, ask yourself are we providing products, selling services, sure but what are we doing with the situation.

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Category: Innovation Social Media Social Organization Technology     Tags: customer experience, Design, product development, product innovation

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In a prior post I raised the point of what happens when frugality fails?  This leads to the question of where IT goes from here.  While the future of IT is an ongoing concern, re-imagining that role starts by recognizing your IT mindset and the mindset of other enterprise leaders.

What do you think when you think about IT?

How do you see IT?

Its role in the enterprise, its value ?

Its potential?

While we all talk about what IT should do, or the problem with IT, etc.  We rarely go back and think deeply about our IT mindset, the fundamental memes, values and outlook we apply in making plans, understanding issues and measuring success.

MORE WITH LESS is the dominant mindset associated with IT, based on discussions with business leaders and CIOs.  Grounded in a view of IT as a set of budgeted resources, assets and an organization that sits within but somewhat apart from other functions in the organization, this mindset is a collection of various views that see IT as:

• An expenditure  — this mindset reverbs from both a financial perspective that sees IT as the single largest part of SGA expense and the echoes of the dot com bust where unregulated IT expenditures in pursuit of the internet promised more than they delivered.

• A commodity — this mindset is a vestige of the Does IT Matter? That was a dialogue that measured IT’s contribution to operations against business strategic value determined by driving unique and differentiating sources of competitive advantage.  For many IT failed this test as it implemented market standard systems and solutions but could not show its value.

• A constraint — this mindset arises as business volatility increased the need to change business practices and operations only to be confronted with IT being the bottleneck for change.  CIOs and IT leaders support this view when they raise concerns about security, risk and expense as reasons not to do something.

In this environment IT is a resource whose supply needs to be controlled and closely monitored lest the organization spend more than it has to.  This is the mindset that measures IT budgets as a percent of revenue (a silly measure at best), seeks outsourcing their mess for less, and asks if there are ways to reduce the cost of IT.

CIOs have played into and re-enforced these mindsets

IT strategies and plans often play into these mindsets.  Cutting costs, constraining supply, turning to IT services, chargeback or outsourcing potentially valuable aspects all enforce rather then engage the ‘more for less’ mantra – with a distinctive emphasis on the “less”!

Nothing has supported this mantra more than IT’s response to the need for radical cost cutting in the 2008 – 2009 period, where organizations reduced IT costs by more than 20% without incurring significant disruptions in operations.   One CEO remarked to me that he felt IT professionals were somewhat dishonest as ‘After years of saying we cannot cut IT, we did and nothing bad happened.’

More for less became and remains a dominant view on IT that is finding new support as business leaders compare what they can buy in the marketplace to the technology they get from their own organization.

The consumerization of IT, led in large part by smartphones, tablets and app stores associated with a company named after a fruit have created the mindset that new ideas, innovation and value now come from the outside and that IT on the inside is at best second class.

Reality is different, but too often we lead with cost when we need to lead with value, performance and results.

We need a new mindset.  I suggest a mindset around how technology amplifies the enterprise.

But what do you think?

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Category: 2012 Technology     Tags: IT strategy, Strategy and Planning, Technology

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For the past 10 years, cost has been the mantra facing CIOs and IT organizations.  Cost benefits are a factor in just about every major technology wave in the past 10 years.  Cloud, the current theme, is presented as a cost play so is sourcing, services, virtualization, open source — if I did not know better I would think that getting IT costs down is the only thing that matters.  The lead story is cost with the good business reasons for technology a secondary concern.

IT frugality can be defined as putting cost considerations at the forefront of technology decisions.

Ten years of tight budgets indicate that IT frugality has largely worked, Based on Gartner Executive Programs CIO survey results, a $100.00 in CIO IT budget in 2002 is now worth $105.50 in 2012.  Adjusting for inflation that same $100.00 in 2002 would be worth $125.75.  In other words, constant dollar terms CIO IT budgets have decreased by $20.25.

CIO IT budgets are influenced by a number of factors and the calculation reflects a global weighted average, so your personal experience will be different based on your company’s strategy, industry, geography and other factors.  This is a crude factor at best, but it indicates the extent of IT frugality.

Based on this crude indicator, CIOs been adept at managing from a financial perspective in demonstrating their frugality and their ability to do more with less. While technology advances, improved price/performance ratios and other developments have ‘saved’ IT, made it more operationally productive, has IT been recognized as a source of productivity, has this frugality made IT better?

I doubt it.  A decade of IT frugality with limited catastrophic IT failure seemed to prove the point that IT is a cost rather than a capability.  The result is a cycle of cost cutting, benchmarking, renewed cost cutting, etc.  Each cycle was driven by macro-economic conditions and micro-executive vision about the role of technology.  So long as you were measuring IT spend as a percent of revenue, you could claim success as it appeared that IT frugality worked – we were getting more for less, right?

While IT spending appears to be in check, what has happened to company capability and corporate IT?

I believe that IT frugality has failed.

Failed in the sense that IT frugality has not delivered ‘more‘ so much as it has cost ‘less‘,

Ten years of tight budgets have changed IT costs but done less to raise IT capabilities.

IT frugality has required CIOs to devalue IT, lowering its unit costs either through sourcing, services, the cloud, renegotiating supplier contracts or cutting IT resources.

These strategies have worked by emphasized the “less” part of IT Frugality and in many cases failed to deliver more to the business.

How can I say that?

Because, the average IT organization is still plagued by the issues it faced a decade ago: weak alignment, poor project performance, limited skills, constraining complexity, lagging legacy systems, a overall weak benefits realization performance. All of these are issues that IT cannot invest its way out of.

All of which create a cycle that re-enforces further IT frugality rather than looking for IT re-imagine its role and how technology amplifies the enterprise rather than just having IT continue to automate and administer back office systems.

The simple answer is to spend more on IT. But I am not so sure that more money is the answer.  Sure IT budgets need to keep pace with the rest of an enterprise’s operations, but throwing money at IT does not solve these problems.  CIOs need more resources, but they also need to reform IT, change the way it works, manages, plans and measures its success.

Frugality begets more frugality.  Reform requires thinking differently.

What do you think?  About IT frugality?  About IT reform or re-imagination?

More on that subject in latter posts.

Related posts

Maximizing IT performance by amplifying performance rather than administering a budget

Technology > IT

2012 begins a pivotal three years for IT

PS:  I borrowed the title after reading Peter Coy’s article in Bloomberg Businessweek, December 26, 2011-January 8, 2012 Page 48.

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Category: 2012 Economy Leadership Management Strategic planning     Tags: 2012 planning, amplify, CIO Leadership, CIO strategy, CIO-Forum-NA, IT strategy, Strategy and Planning

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Last year, CIOs responding to the Gartner Executive Programs CIO Agenda indicated that it was time to re-imagine IT.   Re-imagining IT meant recognizing that business priorities and technologies had changed enough for IT to rethink its role in the enterprise and its value proposition.  For some this meant adopting cloud technologies to reallocate resources from operations to growth and transformation. Re-imagining led others to address IT productivity and cycle time to increase business relevance.

Re-imagining the idea is powerful, but it begs the question –  Re-imagine into what?

This year’s CIO survey provides an answer – re-imagine it into an amplifier of the business.  This led to this years CIO agenda report entitled “Amplifying the Enterprise” which was announced in a press release today.

Amplification, which involves taking a signal adding energy to it and sending it externally, provides an apt metaphor for the role of technologies like mobility and cloud.  These technologies create new channels and platforms for reaching new customers, engaging existing customers and supporting revenue growth.

Amplification also involves handling feedback.  Improperly handled feedback creates that stretching noise that you here when someone uses a podium microphone while they are wearing a lapel microphone.  Feedback related technologies include analytics and social media, which provide better ways to understand and capture what, is happening inside and outside your organization.

Taken together, the signal and feedback constitute a new view on “the experience”.  For most that experience is the customer experience which is essential to driving both growth and removing unnecessary cost, for more details follow this link.

The quality of amplification rests in large part with how the amplifier eliminates distortion.  Its true that distortion can be a form of music, but there was only one Jimi Hendrix so distortion for most of us is a source of cost, complexity, poor service and things that just make it harder to get things done.  For CIOs and their business peers, technology can eliminate distortions caused by duplicative processes, applications, inefficiencies etc.

CIOs in many industries will focus exclusively on eliminating distortions in 2012 as they face severe economic, financial and other challenges.  This is the year to emphasize eliminating distortion rather than reducing the cost of distortion.

All of these points lead to the model below that positions key technologies and their role in amplifying the enterprise.

Is this model perfect, no.  But it does provide a way to think about Technology and its various roles in the enterprise.  We need a new way of thinking because the nature of Technology has become greater than the nature of traditional IT. CIOs, IT leaders and others may want to consider how their IT strategy, plans and actions support amplifying performance – turning up the value of technology without creating distortion or negative feedback.

I believe this is important because when you talk about IT most business leaders think of IT as automating back office business and management processes.  That is true, but that way of thinking leads to a view of commodity-based services or a cost-based zero-sum game.  It is not that this game is wrong, but playing a game of ‘how low can you go’ or ‘doing the same with less’ is one we have been playing.  It is one that limits an organization’s future.

Thinking about Technology as an amplifier reflects the innate capabilities of things like mobility, cloud, analytics and social media.  These technologies are  externally focused.  Without changing the way we think, we will bend externally oriented technologies back internally to fit our existing model.

Force fitting technology into old management and strategy models is a little like buying a sports car only to drive down to the grocery store.  Sure you will look cool doing it, but you could have done so much more – you could have amplified the enterprise, you could have re-imagined Technology.

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Category: 2012 Leadership Strategy     Tags: 2012 planning, amplify, CIO Leadership, CIO strategy, Strategy and Planning, Technology, Technology Leadership

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Technology is becoming more important than IT.  Now that may sound strange, after all what is the difference between technology and IT.  For years the answer was, not much.  Corporate technology centered on automating corporate business processes such as ERP, CRM, SCM, PLM, etc.  These technologies requires corporate IT to acquire, install, tailor and operate on behalf of the organization. Emerging technologies were co-opted into this model through consolidation of start-ups or ‘maturing’ of the new technology.

A significant part of the Internet has become ‘corporate’ as it has been structured, organized and packaged along either infrastructure or business process automation lines.   While not all of the web is that way, the dominant way of thinking about technology has changed the application of the web to business.

The view of IT as technology applied to automating, structuring and managing business processes via applications and operations has dominated our thinking for the past 30 years – making technology and IT synonymous from a business and operational perspective.  We assess new and emerging technologies based on their progression from raw ideas and machine capabilities into a set of structure solutions that allow anyone with the resources to reach the plateau of productivity.

New technologies like mobility, cloud, analytics and social challenge this view.  These are generative technologies, like the PC or Internet they provide the basis for creating new solutions and innovation.  They are a base set of technologies for amplifying the enterprise, changing its external relationships, how it handles feedback and eliminates distortions internally and within its value proposition. These Technologies can include IT, but they can also go beyond our traditional notions and concepts of information technology.

How?

Well through a view of Technology as a means to open markets, attract customers, retain their attention, change their behavior, participate in value creation etc.  Mobility, cloud, analytics, social and the new range of technologies can do more than manage predetermined, prescriptive back office business processes.  They can bring information, access, context, values, behavior and a range of other things together to change the meaning of products, services, and work rather than just changing the way people work.

That view is emerging, but it is not from IT, it is from business leaders who are Technology Savvy.  The difference is important to consider.  Technology Savvy executives see technology as a means to create an external outcome, one in the marketplace, with the customers, within the offerings etc.  These leaders are concerned with behavior, choice, context, engagement, attention, motivation, etc.   They not IT Savvy in the traditional sense, as they are less concerned with internal operations, the limitations of legacy, etc.  Notice the distinction between Technology and IT?

By now you are saying that a business needs both Technology and IT savvy and you are right.  After all the innovations and excitement generated in the front office needs to be delivered in the processes and hard work at the back.  You see this right now in discussions around mobility as people are looking for standard solutions to ‘manage’ mobility, control it, integrate it, operationalize it – put a fence around it even though we are just beginning to understand the free range of innovation surrounding it.  That’s not a criticism of the need for emerging technology to mature, but it is an observation that we often want our Technology to grow up into IT solutions too fast.

The realities of the back office do not negate the differences emerging between Technology and IT.  If it does, then the promise associated with mobility, analytics, cloud, social, etc. will falter. They will be come new ways to do the same old stuff.  They will focus on a different approach to automating business processes rather than creating new levels of innovation, value and advancement.

The alternative is to think about Technology as including but being broader than IT.  That view keeps the door open to the generative possibilities of current and future emerging technologies.  It keeps the focus on how technology changes the business externally, rather than automating and integrating internally.  It creates a path for current IT professionals to do more than fit new code, devices and computing into old paradigms.

It provides a way to think of how Technology Amplifies the Enterprise.

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Category: 2012 Innovation Re-imagine IT Strategic planning Technology     Tags: 2012 planning, amplify, Business Strategy, eme, Strategy, Technology Leadership, Value of IT, web 2.0

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Amplifying the enterprise involves turning up the value of technology in the enterprise.  Eliminating distortion is one of the ways that technology amplifies the enterprise.

Distortion refers to the internal complexities; costs, duplication and redundancies that make it harder to get work done. Think about the things that get in the way, make it difficult for customers to understand or transact business with you, provide inaccurate information, basically anything that consumes effort without creating results.

Look for distortions by applying a few ideas:

• Identify areas where headcount has increased at a rate faster than revenues or business activities.  Chances are the people are being put in place to manage distortion, particularly in customer sales and service areas.  As one CIO put it, ‘we use people as middleware for poor process, system and product decisions.

• Evaluate support areas that should be creating scalability through productivity enhancements.  Measure actual transaction volumes against average costs as expense may increase due to transaction growth rather than expenses increasing because we are creating more work.  Transaction growth may require productivity improvements, things that create more work are distortions.

• Look at manager to staff ratios, the span of control should be stable or growing.  Pay particular attention to ‘professional’ jobs in your organization as often people are promoted to management roles to address compensation issues rather than being part of an organizational strategy.   If the need for managers has increased over the last five years, this is a sign of distortion.

• Think about how much multi-tasking you ask your people to handle.  Multi-tasking are a sign of distortion as incremental and accumulating change requires people to take inconsistent responsibilities.

Here are a few thoughts on things that may be driving these and other types of distortion in your enterprise:

• Incomplete or unfinished post merger integration plans. You were going to fix that but it was postponed.
• Multiple product codes, processes, systems that perform similar functions but can be consolidated.
• Remnant organization structures, for example country management activities that remain even after you have moved to a regional structure.  Or teams that have persisted because of personality rather than responsibility.
• Similar systems that work with the same data, these can most likely be consolidated as they may have different pasts but the data tells you they have a shared future.
• Old business rules implemented over the last 5 or 10 years that are no longer required, but remain in effect.
• Sources of waste, or muda, which exist both in the business organization – apply lean principles to everything.

Eliminating distortion requires focus and resource, which can be difficult to obtain.  Consider establishing a ‘sinking fund’ to support the first wave of elimination and refresh this fund with achieved savings.  This allows savings to accumulate in the organization while managing distortion elimination efforts.

Gartner’s Andy Kyte says everything in your organization had parents at their beginning.  Those parents own the solution and who wants to see their child removed.  You have to ask if the solution is creating more value than the complexity it creates.  It may be time to create a new family, as in the Brady Bunch, with processes, groups and activities.  Its not that something is going away, it is going to a better place.

Considering the sources of distortion represents an important strategy for CIOs and IT, particularly as those that have gone through multiple waves of cost cutting, contract negotiation and sourcing.  Repeating those same tactics results in diminishing returns, rather than getting to the causes and sustainable solution to distortion.

Distortion drives cost, reduces customer service, decreases agility and ties up resources that are needed for change.   You can lower the cost of distortion by outsourcing, renegotiating contracts, etc.  But amplification requires eliminating distortion to sustain results.

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Category: 2012 Strategy Technology Tools     Tags: 2012 planning, amplify, CIO-Forum-NA, cost cutting, Economic Recovery, IT strategy, Strategy and Planning

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