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Thinking Small — Thinking value

by Mark P. McDonald  |  September 16, 2011  |  4 Comments

This post is the companion and conclusion to the issue of Thinking Small about IT cost and value.  In that post we discussed how thinking about IT as BIG, complex and important creates an environment where the only way to control IT is to control its costs.  Thinking small about IT opens the door to different approaches and opportunities that see value not as a set of activities but as a series of results.

Thinking Small means thinking about business performance

Leaders thinking small about IT recognize that the value game has changed as the IT has saturated business processes and transaction systems.  IT is now a game of generating a yield on those investments rather than requesting more funds to repave digital cow paths.

Thinking Small connects value with a change in business performance rather than proving you are not wasting money. Measures for the value of IT come from showing the connection between IT actions and business performance – the real value of IT.  Leaders know that this connection is continuous demonstrating IT’s value over time.

BIG thinking looks at project spend, portfolio budget, and fully allocating IT resources that imply size with importance. BIG thinking back this implication with BIG control processes that rations IT supply as a precious and fixed commodity, concentrates on how those resources are spent and proves success by showing that IT is doing its job by coming in on scope, on time and on budget.  The resulting management mantra and culture of ‘business and IT’ is one that worked when technology was scarce and required allocation.  Today this culture is alienating IT professionals at the same time as the organization’s they work for gain greater choice.

Thinking small makes IT part of the organization rather than a separate ‘service’

Thinking Small recognizes the reality of organizational complexity.  Thinking small sees IT as part of a bigger, complex and dynamic socio-technical firm.  Thinking small refute the fallacy of BIG thinkers who believe that they can fully understanding requirements a priori or hold the rest of the business in limbo ceteris paribus while IT builds its solutions.

Leaders who Think Small about IT do not try to ‘save the business from itself’ by claiming to know the business better or what the business really needs.  These are behaviors lead to working in ways that separate IT from the business. If they want to be part of the team, they need to be ‘onside’ with the business and nothing brings onside more than focusing together on the business issues that lead to value.

Thinking small recognizes that technology has real limits

Thinking small keeps leaders from chasing every problem with a technology solution.  They know that technology is not a universal salve for every problem. It cannot prevent every error nor insulate the organization from all threats or risk.  They achieve this through changing technology in combination with changes in roles, rules, processes, products and services.

BIG thinking sees the need for IT to take on complex issues in support of IT investments and importance.  When IT is seen as THE solution it takes on issues and operational aspects that no amount of technology can solve.  The resulting solutions wind up in creating core rigidities by sealing the business in silicon.

Thinking small adds a time dimension for value

Thinking Small connects time with value.  They focus on time to market, time to capability; time to scale and realize that the business value only begins once the solution is working in the field.  This leads them to ‘solve and evolve’ through smaller, rapid, incremental change.  Along the way, they build the organization’s confidence and capacity for change.

Leaders use small thinking, to drive continuous evolution rather than discontinuous transformation.  They create capability from new combinations built in a series of multiple, well focused, and clear changes that make effective use of new techniques like Agile Development.

BIG organizations don’t see this.  They buy into transformational change as the only way to achieve a strategy. They believe that no one improves or continuously updates themselves to be successful, not Apple, not Toyota, not GE, not Wal-Mart.  That success is like jumping from roof-top to roof-top where you either win big or fall and have to jump all the way back to the top.

Thinking small means thinking asymmetrically

Big thinking seeks to match the size of a BIG IT project with a big business cases.  The result is a transformational project that is ‘too big to fail.’   BIG thinking uses cost as the measure of importance and power comes from postponing immediately realizable value for bigger future to the degree that benefits realization is unrealistic and unattainable.

Small IT seeks to leverage existing information and technology resources through using small investment to tackle larger issues.  Lightweight technologies like mobile provide a platform for this type of asymmetric investment.  Thinking small is the basis for the difference between ‘apps’ versus applications.

Thinking small builds experience by continuous engagement and evolution

Small IT creates a steady stream of value through smaller and more frequent releases rather than bundling them all up into big transformation efforts.  This reflects the reality of IT’s deep installed base of systems.  It strengthens IT’s responsiveness through building up its small project muscle.  Most importantly, it gives IT professionals a set of constant challenges and accomplishments that will build their experience now.

Big thinking puts value on hold to the degree that it saps the lifeblood out of the IT organization as transformation occurs ‘once in a lifetime.” This denies IT professionals the energy and experience that comes from completing a project and seeing its results.  IT reinforces IT’s role as an operational/administrative function that is apart rather than ‘a part’ of the organization.

Bringing it all together, thinking small brings a new perspective on value.

Thinking BIG about IT leads to seeing technology in ways that can be difficult for the enterprise to understand, unwieldy to manage for agility and controlled though cost.  That way of thinking saw IT through its first forty years as we created technology when none existed as we automated processes, integrated that automation and then moved that to the Internet.

We have done all of this.

We have met yesterday’s challenge.

But next set of challenges is not about what IT costs,

Rather they are about generating a return on the resources we have created.

That requires new thinking about IT, thinking small not in terms of IT’s value but in terms of IT as a source of business performance, at speed, with agility and in ways that strengthen IT’s experience, ability and capacity to do more.

By thinking small, we can expose BIG thinking bias and consider alternative ways in which we create value, in the performance the business understands, in time and in context. Thinking small about IT helps re-imagine value and its realization in ways that build up our capacity/capability rather than consume cost.

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Category: 2012  management  small-it  

Tags: it-management  small-it  strategy-and-planning  value-of-it  

Mark McDonald, Ph.D., is a Vice President and Fellow Emeritus in Gartner for General Managers Program.

Thoughts on Thinking Small — Thinking value

  1. […] their risk pay off. More than ever, people are motivated by the opportunities that come with scale.Thinking Small — Thinking value by Mark McDonald Quote: By thinking small, we can expose BIG thinking bias and consider alternative ways in which we […]

  2. Mark, I really enjoyed this topic. Gustavo Monne (@Gmonne) turned me on to it via his LinkedIn update. While I had not thought about the small vs big angle, the concepts you mention certainly resonate with me and with the themes permeating our own IT organization at Intel IT. Keeping IT innovation simple, agile, continuous and focused on creating business value is clearly an IT best practice for all IT professionals. At Intel IT, we are now emphacizing on-demand IT solutions and customized customer driven Business Intelligence solutions as means to increase business velocity.
    This website shares some of the IT leadership priorities from Intel’s CIO staff:

  3. Anwar Sadhe says:

    Recent Blogrolls……

    […] Blogpost: update .. noticed this write-up on the subject of […]…

  4. Abhijit Chatterjee says:

    Hi Mark, your this article is fairly transforming from the traditional mindset of ‘ bigger the better’.

    In fact I am going ahead and sharing this Article of yours with some of my prospect who might like to read and get a fresh perspective.

    Keep up with the good blog. Cheers !!

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