Mark McDonald

Gartner EXP / Management Innovation Lab Hackathon invites a select group of IT leaders to crack a key issue—how IT can help organizations become more adaptable.  For the past two months more than 240 senior IT executives from around the world have been discussing technology’s role in enterprise adaptability.

This post is an update on the results of the second sprint in the Hackathon focusing on identifying the barriers to adaptability.  The first sprint completed in April concentrated on why adaptability matters.  Follow this [link] to see a post highlighting some of that discussion.

In Sprint 2 of the Adaptability Hackathon, we discussed and dissected the barriers that stand in the way of our organizations becoming more adaptable, and began to share ideas about how technology might help us overcome them.

When we tallied the votes at the end of the sprint, our hackathon participants had determined the following four barriers to be the most pressing to address:

1.     Too many big bets, not enough little ones
2.     A monopoly on capital allocation
3.     Monolithic structures
4.     Centralized decision-making

For today’s post, I thought I’d dive a bit deeper into the conversation around each of these four barriers.

Too many big bets, not enough little ones

This barrier, far and away the one that received the most votes by our hackathon contributors, was based on the simple idea that adaptability depends on experimentation. The more experiments an organization runs, the greater chance that one of them will result in a truly organization-altering innovation.

Yet many companies today only make a few big bets, and don’t have the management or technological infrastructure in place to make lots of smaller bets at once.

In his barrier submission, entitled The problem with projects, David Clark of Gartner suggests that project management itself—and the controls and process that come with it—may be a reason why we are not able to make more bets more quickly.

In his Good Stewardship barrier submission, Chris Bertelsen from Protective Life suggests that technology might be able to help us make smaller bets by providing less expensive ways to measure our progress and by providing platforms and methodologies that lower the governance bar and make experimenting less expensive.

Borge Teigland, VP Global IT/CIO at Norske Skogindustrier ASA, commented that IT itself might be one of the biggest barriers to innovation simply because of the big bets IT has placed in big ERP systems and locked-down infrastructure.

Finally, Dan Kelly, Director of MIS at Nemschoff Chairs / Herman Miller suggested that “streamlining the specification process of new solutions” might be the key to bringing technology and business closer together.

Based on the contributor’s comments and ideas, I think our challenge in addressing this barrier will be twofold. First, as IT professionals, we will need to look inward to see what we can change and streamline about our own technology choices and processes to make it easier for our organizations to experiment more and make more small bets without IT becoming a hindrance. But beyond that, I’d like to see us explore ways we can help our organizations implement new technologies that make the process of experimenting (and measuring the results of this experimentation) easier, cheaper, and faster.

A monopoly on capital allocation

In most companies, there’s only one place an employee can go to get funding for an unconventional idea—up the chain of command.  If the project doesn’t dovetail with the boss’ priorities or prejudices, it doesn’t get funded.  This paucity of funding sources puts a huge damper on innovation and adaptability.

This was our second highest voted barrier, and according to Tom Honan, CIO at CapitalSource Bank, it is a critical barrier to address.

“Implemented to help identify and ensure capital spending is aligned with the organization’s strategic plan and goals, it can serve to starve out many worthy endeavors,”

Tom said. He then went on to comment that at CapitalSource Bank they have been considering options to decentralize investment spending without losing alignment to the strategic plan. I hope Tom shares some of his ideas for how they might approach this as a mini hack during our next sprint.

Paul Green, Jr. of The Morning Star Company built on Tom’s comments by suggesting that perhaps by using technology to bring more people into the strategic planning process (as organizations like Wikimedia have done), more people might understand and share the strategic priorities. Eventually this might even lead to redefining the way strategic priorities are chosen in the first place, including more people in the process.

Margaret Lam, Director of Enterprise Architecture at Seagate Technologies made another interesting observation about capital allocation. She suggests that organizations are almost always driven towards optimization, while entrepreneurial organizations are driven to take risks.

“We look for ways to optimize resources, cost, assets, etc. If it is not a project with proven ROI, we don’t want to do it. Entrepreneurial companies are exactly the opposite. They encourage ideas, innovations, forgive failures, and take risks. They are willing to provision time and resource to “fund” idea generation.”

As we begin to hack ways that we could eliminate the monopoly on capital allocation, I hope we’ll consider ways that IT could enable organizations to act more entrepreneurial and less bureaucratic and perhaps even begin to involve more people at more levels in the organization in the capital allocation process.

Monolithic structures

Most big organizations today operate as monolithic structures—not particularly nimble or flexible. But could technology help even big organizations become more adaptable? What could IT do to help disaggregate the organization?

In Binary thinking; Singular thinking style, Jim Stikeleather, Executive Strategist at Dell Services, suggests that one issue with monolithic structures is that they encourage monolithic thinking:

“Organizations drive themselves to the “one answer” and do not allow themselves to hold all possibilities open until the last possible minute, and then collapse like a probability wave into one state or another. Instead them must believe in the “one truth” and pursue it and only it until it either succeeds or fails,” Jim said.

What is Jim’s answer to this challenge?

“In reality, an organization has to practice both simultaneously in order to be aware of all possibilities; be able to stat rank probability, value and risk for each possibility; to “go where no man has gone before” in preparing for those possibilities. It is the dialectic – thesis, anti-thesis then synthesis that these two conflicting modes of reasoning provide that enables an organization to adapt.”

Some of the discussion on this barrier centered on the idea of helping monolithic structures becomes more nimble and flexible. Colin Cunningham told a story about an exercise he was involved at in a Singapore bank where “we built the capability for sales staff, selected customers and technical people to interact together for 2 hours a day to identify improvements and issues in current live systems.” His question: “This is at a tactical rather than strategic adaptability level. Could the concept be taken to the strategic level?

As we begin to hack how technology could help us break down the monolithic structure of our organization, I hope we’ll keep some of these thoughts in mind and look for ways that technology can help organizations become more flexible by becoming more multi-dimensional, supporting more ideas, answers, and strategies at once.

Centralized decision-making

In most organizations, senior executives dominate the strategy and decision-making process. Yet this becomes a problem when these executives have too much emotional equity invested in their past decisions or in short term financial goals. Could we protect the organization and increase its chances of adapting successfully by using technology to harness the intelligence of the entire company (not just the executives) in making decisions?

Thierry Kuperman Le Bihan points out that the executives in charge may not always have the best long term adaptability interests of the organization at heart because of “the inevitable short-term interest from CEOs to make quick profits and leave the company in a better financial position when they leave. This objective prevents the CEO from thinking about the future of the company beyond a sequence of quarters.”

If Thierry is right, perhaps decentralizing decision making and including more people within the organization beyond the executive team in the process might provide a “check and balance” to ensure the long term future of the organization isn’t just determined by short-term goals.

As we consider how we might use technology to disaggregate some of the decision-making authority within our organizations, I’d love to see hacks that use technology to balance the decision making power between the people at the top of the organization and those in the trenches who might have even better, more current information and—collectively—are prioritizing the long term adaptability of the business over short term financial objectives.

Getting ready of the next sprint

Over the past few weeks our discussion of the barriers to adaptability has proven to me that IT leaders have a unique vantage point from which to analyze these challenges. I’m looking forward to seeing how we use our collective knowledge and experiences to begin to address these barriers over the next few weeks.

This is the next step toward our final goal: identifying the management and technology ‘hacks’ that increase organizational adaptability.

If you are not yet registered for the hackathon and would like to participate, please visit: www.mixhackathon.org/gartner.  There is still time to participate.

We have discussed the dynamics, identified the barriers, now let the hacking begin! 

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Category: Innovation Management     Tags: hackathon, Leadership, Management, Strategy and Planning

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