SaaSkatoon

Whether we are actually entering a cycle of economic recession or not may be up for debate, but what is certain is that we always need to be ready for any type of downturn in the business environment. From an IT perspective, periods of uncertainty present an opportunity to focus on becoming leaner and more effective. While Information Technology organizations have been “doing more with less” for a number of years, you can rest assured that the term is only going to be heard more if we are in fact encountering a prolonged slowdown in the world economy.

Let’s assume that since just about every media outlet in the United States is throwing around the “R” word these days when they’re not incessantly covering primary election results, it’s somewhat likely that we will see some level of contraction in our economy (because the media is always right, of course). Let’s also assume that this period of contraction will last about a year, which is slightly longer than the average for recessionary periods over the past 50-or-so years. What this means is that if all of the stars are in alignment and we hit a rough patch in the economy, there will likely be less people buying what your company is selling; and with less dollars hitting the top line, your business will have to do a little belt tightening to maintain the bottom line for the rest of this year and part of next year.

With the corporate Information Technology function facing a critical inflection point that will determine nothing less than its survival as an entity, there is no better way to show how much IT matters to than to step up and demonstrate vision and leadership in a time of uncertainty and fear. When times are rough, budgets get cut, hiring activity gets put on ice, and business units across the board are expected to maintain or improve performance despite such resource handicaps. Deal with it. Times like these are not an excuse to go on autopilot and simply survive – those who play to win will come out of this stronger than before, and those who play to not lose will be left behind.

This entry first appeared in The Mikan Group Blog on February 18, 2008.  It is being published on SaaSkatoon in an effort to archive selected content acquired by Delivered Innovation in 2008.

While the end of the year presents an opportunity to reflect on the previous twelve months, such reflection is for naught if it is not applied to the vision and strategy for the year ahead. The key is to identify the lessons learned throughout the year, and to contextualize them into categories that are tied to specific actions; placing experiences and lessons into three action “buckets” helps to not only create a clear understanding of what happened, but to create a framework for strategic thinking for planning activities in the New Year. The action “buckets” look something like this:

• Keep – The items that are placed in this category provide the answer to the question, “What worked?” Decisions, plans, and actions that led to successful outcomes are noted and analyzed to determine the “Why?” behind such events. It just as important to analyze the root cause of success as it is to analyze the root cause of failure, so tackle the good with the same analytical rigor
  as the bad to determine why something was successful.
• Change – This will likely end up being the biggest bucket when all is said and done. The question that the items in this category answer is not necessarily black and white; the question is more
  along the lines of, “What was good that we can make great with the appropriate adjustments?” What initiatives showed the greatest potential, but didn’t get the attention required to succeed? What could provide substantial return with a revised strategy and focused execution? What opportunities were not fully seized but still have significant upside potential? It is important to approach the “Change” category with objectivity and pragmatism, because overly optimistic analysis can lead to resuscitating items that should be left for dead, and overly pessimistic analysis can prematurely relegate items to the next category…
• Abandon – There are many explanations as to why this category seems to get ignored during analysis and planning exercises, but the bottom line is that not everything is going to work out despite high hopes and best intentions. The decision to abandon something needs to be made objectively and with limited emotional influence, which is easier said than done when an item has a significant amount of the organization’s sweat, blood, and tears invested in it. This is the type of decision that requires resolve and strong leadership, as the emotional ties to the items
  that face the chopping block have a tendency to lead to compromise at times when the realities of limited time, energy, and resources make it impossible to keep every initiative on life support.

Once the reflection exercise is completed, it is highly likely that not every lesson, initiative, or event that has been identified and analyzed fits neatly into one of the three buckets above. It is also highly likely that the strategy and objectives for the upcoming year will require some additional shuffling of initiatives and priorities. This is where reflection and projection come together: New requirements for the coming year will influence the categorization and prioritization of ongoing efforts; “Keep” and “Change” items will create requirements in and of themselves; and in the end, the old and the new need to be aligned to create a single, cohesive vision and strategy to govern the efforts of the organization for the next twelve months – when the process starts all over again.

This entry first appeared in The Mikan Group Blog on December 26, 2007. It is being published on SaaSkatoon in an effort to archive selected content acquired by Delivered Innovation in 2008.

Managing complexity is likely the single most daunting responsibility of Information Technology managers.  Without diligent design, planning, and oversight, the proliferation of server hardware, platforms, laptops, workstations, desktop operating systems, personal productivity software, office suites, data networks, voice networks, storage area networks, network attached storage, robotic backup libraries, administration tools, system monitoring, custom applications, messaging systems, wiring closets, data centers, firewalls, spam filters, antivirus, anti-malware, wikis, blogs, help desks, mobile devices, data warehouses, business intelligence, CRM, ERP, SaaS, web services, portals, intranets, extranets, racks, copper, fiber, whatever else the trade magazines tout as being the next big thing, and every other esoteric component that makes its way into the enterprise will create an impossibly complex mess of technology that requires every ounce of fortitude to manage effectively.

Woe is the IT manager.  The businesses that IT organizations support most likely do not understand the enormity of the undertaking that has become IT management; unfortunately for the besieged IT manager, they don’t have to and shouldn’t have to understand.  Businesses need to know what they will get in return for their IT investment dollar, and they need to have faith that IT will continuously deliver increasingly complex and difficult services to meet the increasingly complex and difficult business requirements that emerge in a rapidly globalizing marketplace.  This is the reality of the situation, and because there is little sympathy for IT managers that have to deal with this on a daily basis, there is but one course of action that can be taken to address the situation – reduce the complexity that hangs like an albatross around the neck of the Information Technology function by simplifying and standardizing how IT operates.

It is understood that there are times when the role of IT management requires a degree of heroics; even the most well-oiled of IT departments experience emergencies from time to time.  One of the fundamental problems that has led to the current state of pervasive complexity in Information Technology is the tendency of IT workers to view themselves as firefighters and puzzle-solvers, always on the ready for whatever catastrophe or hair-on-fire business requirement comes their way.  While this mindset may have been an asset in the pioneering days of Information Technology as an organizational function, it lends itself to a short view of a world where the reality is that one not only has to see the proverbial “forest for the trees,” but has to see beyond the forest and understand how decisions and actions impact far beyond the walls of the organization.  Every new component or entity introduced to an IT ecosystem necessarily increases the complexity of the environment; when the current state of affairs requires less complexity in the environment, every action that potentially impacts such complexity needs to be well planned and executed, and optimally is driven by a strategic framework that is developed with the specific goal of managing and reducing complexity at its core.  Organizations that do not mature beyond a state of heroics and short-term solutions will never reach the level of forward and holistic thinking required to successfully conquer complexity.

This entry first appeared in The Mikan Group Blog on October 18, 2007. It is being published on SaaSkatoon in an effort to archive selected content acquired by Delivered Innovation in 2008.

Looking back at the definition for alignment that is core to the concept being presented here, the two primary components of alignment are ”a state of agreement or cooperation” and “a common cause or viewpoint” among employees, teams, functions, etc.  The application of a common cause to the principle of alignment was discussed previously, and thoughts surrounding the cooperation element will be fleshed out in this segment.

When applied to the “alignment hierarchy” (Ideology > Vision > Strategy > Goals > Objectives > Plans > Tactics > Actions), the concept of ubiquitous common cause correlates predominantly to the Ideology and Vision of an organization, and to a lesser extent to Strategy and Goals.  At the top of this hierarchy lie the concepts that, for all intents and purposes, transcend business unit and functional boundaries and are primarily generated from the top of the traditional organizational hierarchy.  As the alignment hierarchy is traversed, each level tends to correspond to a more granular level of the organizational hierarchy; just as Ideology and Vision corresponded to the top of the organizational hierarchy, Tactics and Actions correspond to the individual workers in the organizational hierarchy.  This does not imply that the top of the organization does not have any connection to Tactics or Actions, nor does it imply that the staff level does not influence Ideology or Vision; the implication lies in the strength of the correlation between like positions on the respective hierarchies.

What this all means, in essence, is that Ideology and Vision are communicated top-down, and the Tactics and Actions employed in executing the Ideology and Vision are executed bottom-up.  This is not earth shattering analysis by any means, but it is an important idea to ponder as the concept of organizational alignment is fleshed out.  The opportunity for effective alignment lies more towards the center of the hierarchy, where Strategy and Goals are defined in support of the Ideology and Vision.  In an organization segmented by function and managed in a traditional top-down structure, Strategy and Goals are where the functional tiers of the organization logically align their more granular and specific modes of operating with the higher level cross-functional Strategy and Goals.  This is where the greatest opportunity for alignment exists, and subsequently where the greatest alignment challenge lies; it is also the entry point into business units (and subsequently functional silos), and the point where alignment success or failure cascades to the lower tiers of not only the organizational hierarchy, but also the alignment hierarchy.

When the Strategy and Goals of a business unit align with the holistic Strategy and Goals of the organization, the business unit Objectives and Plans will be formulated to move the business unit (and presumably the subordinate functions) in the direction of the Strategy and Goals.  Any misunderstanding of or disagreement with the organizational Strategy and Goals at this level is highly detrimental to the entire organization, because the lack of alignment will cause the business unit and its subordinate functional units to formulate Objectives, Plans, Tactics, and Actions that at best add significantly diminished value than what is expected and required by the organization to meet its Goals in support of its Strategy, and at worst handicaps or causes irreparable damage to the organization.  Strategy and Goals may exist at each level of an organizational hierarchy, but it is absolutely imperative that they are aligned with the higher level Strategy and Goals at each higher level of the hierarchy to ensure that the resulting Objectives, Plans, Tactics, and Actions are in alignment with the Strategy and Goals of not only the respective operating unit at a given level of an organizational hierarchy, but with each level above it.

When this concept is applied to a horizontal, process-driven organization, alignment is no less important than it is in any other organizational structure; it simply has less vertical levels to traverse, and by nature a process shares a common alignment hierarchy (i.e. flat) from input through output.  Process orientation implies alignment with organization Strategy and Goals, and when adjustments need to be made to a process to improve alignment, they are integrated into the process design and disseminated to the process team by a unifying process owner that ensures that the resulting output of a process is understood by every contributor to the process, regardless of functional orientation.  The general management function in a process-driven organization is responsible for ensuring that the output of a given process is aligned with the inputs for dependent processes, and any adjustments to such outputs are either communicated to a process owner that makes required process design changes, or the dependent processes make changes to the input interfaces to ensure alignment and integration.  These are predominantly adjustments to Plans, Tactics, and Actions, as the fundamental Strategy, Goals, and Objectives remain in fundamental alignment throughout the processes of an organization; this is a key point, as the number of “moving parts” throughout an alignment hierarchy are minimized, which reduces complexity and focuses the organization on achieving core Vision and Strategy rather than continuously making adjustments throughout the hierarchy of a functionally-oriented organization that may or may not be successfully executed.

Obviously this is a subject that warrants more thorough research and detailed explanation than what the Blog format provides, but the intention was not to communicate an authoritative viewpoint on the concept of alignment, but to create a starting point for discussion on the subject that is removed from the rapidly proliferating rhetoric.  Paradoxically, while it is important that the concept of alignment has made its way into mainstream trade publications, this exposure and the lack of clarity surrounding the definition of ‘alignment’ are what will cause it to be dismissed as yet another buzzword that failed to gain the traction required to stimulate the discussion and debate required to turn a rough idea into a well articulated framework for practical application.

This entry first appeared in The Mikan Group Blog on September 20, 2007. It is being published on SaaSkatoon in an effort to archive selected content acquired by Delivered Innovation in 2008.

Outsourcing seems to be a dirty word in the IT community, despite the fact that it has become necessary to consider the outsourcing of non-core activities as a strategic option in the end-to-end management of Information Technology.  While outsourcing for outsourcing’s sake is a fatally flawed strategy, the outsourcing of non-value-adding processes and services has to be taken into consideration by any IT organization that hopes to meet changing business needs in a timely and consistent manner.  A common tendency of some IT organizations is to adopt a defensive attitude towards outsourcing and either attempt to indefinitely stall what in many cases is already inevitable, or struggle to somehow demonstrate value to the business by wearing as many hats as possible and providing every IT service in-house; as talented as a team might be, the velocity and breadth of emerging business requirements makes it impossible for most internal organizations to provide services at the levels of availability, performance, functionality, and value required by the business.  The result of trying to be everything to the business is that the aggregate level of service gets watered down with each new service introduced and brought under management, until eventually the model becomes completely unsustainable.  At some point, the realization needs to be made that IT requires the focus of a laser beam, not a shotgun blast, to deliver world class results.  Outsourcing is not an either/or proposition, and organizations that learn to look beyond this duality and view outsourcing as an opportunity to leverage external resources to accomplish activities outside of the scope of core competencies - to reduce costs, increase the velocity of service delivery, and free internal resources to focus on value-adding activities – will gain an inherent advantage over peers that do not capitalize on the opportunity.

The Mikan Group’s position on outsourcing is that no viable option can be left off the table by either the business or the Information Technology organization when planning and executing an organization’s strategic vision.  We understand the general apprehension towards outsourcing and its implications, but we also understand that much of the resistance is based on speculation and hype.  And to be clear, while outsourcing and offshoring are terms that have become nearly synonymous, there is a very clear distinction between the two.  But for the sake of addressing the fear, uncertainty, and doubt associated with the topic, we will cut to the core and address the issue of jobs being sourced globally at the perceived expense of American workers.  Not to put too fine a point on it, nobody wants to see American jobs arbitrarily shipped overseas – especially us.  The Mikan Group believes absolutely in the business value of Information Technology, and we believe in the technology leadership position of the United States, but we are also realistic in our assessment of the current state of the IT function; there is a growing disconnect between the services that IT delivers to the business and the services that the business expects from IT.

We must take responsibility for the fact that the track record of Information Technology producing sustainable business value is less than consistent, and we must find ways to restore faith in IT by leading a fundamental change in the way IT supports the business in a manner that is nothing less than revolutionary.  The defensive strategies of survivalism and protectionism only make the situation worse, and while we realize that some businesses have engaged in wholesale offshoring of entire functions as a fairly short sighted reaction to cut costs and improve margins over the immediate term, the harsh reality that we can no longer deny is that IT has reached what Andrew Grove referred to as a “strategic inflection point” and we can either lead IT to new heights by focusing on tight integration with business strategy and objectives, or we can cling on to the past and hope to weather a storm that is only going to wash away IT as we know it today.  Whether you are an executive looking to maximize the value of your enterprise IT investment, a business leader looking to improve the effectiveness of your function by leveraging process and technological innovation, or an IT leader looking to align your team, systems, and processes with core business strategy, The Mikan Group can enable you to reach your objectives and deliver business results within the framework of the organizational model best suits your business: in-house, outsourced, or anywhere in between.

This entry first appeared in The Mikan Group Blog on August 25, 2007. It is being published on SaaSkatoon in an effort to archive selected content acquired by Delivered Innovation in 2008.