elemental links

Forrester: Don’t be an IT-hater, be a Business-IT Integrator

I’m cross-posting my latest from the new Business Ecology Initiative blog.  As you know, “Business-IT Integration” is one of my soapbox items. 

In a recent post on the Forrester Blog for CIOs, Sharyn Leaver writes an inspired response to Susan Cramm’s 8 Things We Hate About IT.  As outlined in CIO Insight, Cramm’s “8 Things” focus on the following business-IT relationship issues:

1. Service or Control?
2. Results or Relationships?
3. Tactics or Strategies?
4. Expense or Investment?
5. Quickness or Quality?
6. Customization or Standardization?
7. Innovation or Bureaucracy?
8. Greatness of Goodness?

In her post, Leaver refers to the above as ““8 Beaten-to-Death Clichés” about IT-business relationships”.  However, her point isn’t directed at Cramm, but rather the situation that business and IT executives and professionals continue to inhabit.  As a way out, Leaver offers some good observations and actionable advice.  Her first two points relate to organizational design:

• “Tension between IT and line businesses is designed into organizational structures. Hard-wiring organizational lines into centralized IT “shops” assigned to business units or combinations puts IT unwittingly into a self-perceived servant relationship with business units. No doubt in recent economic downturn years, increasing centralization of IT has resulted in a cementing of “us” versus “them” — where as federated and decentralized structures preserve some of “us” within “them” and align attitudes and goals accordingly. HR, Accounting, Facilities, and other centralized services all struggle with balancing acts of meeting the needs of those they service.
•  Preserving a request-fulfill relationship institutionalizes disappointment all around. Missed expectations and unhappiness result from a “take a number” approach to queuing up service requests, ranking them according to some criteria, estimating fulfillment time, and attempting to deliver in the face of numerous “Look over there!” distractions. Again, breaking up some of the IT resources into the business units for dedicated and local work would help. CIOs should read and absorb Forrester’s BT model for operating IT.”

From a Business Ecology perspective, we refer to these design shifts as Business-IT Integration:

“Business-IT Integration is the organizational model for business and information technology convergence.  This model promotes collaborative strategy, planning, architecture and execution; shared decision-making, business-tech savvy personnel and service delivery at the point of value generation.”

Similar to Leaver, we are not saying immediately or completely decentralize IT, nor are we calling for an end to enterprise-level strategies and resources, but rather, that a new model is required.  A model that supports near-term needs as well as business vitality over time, balancing current conditions, optimization and innovation focus areas, resource allocations, and longer-term business motivations, capabilities and outcomes.

As Leaver points out, the time of lamenting needs to end, it is time to take action. 

To gather other actionable ideas, I plan to read Cramm’s book.  A related read I highly recommend is Weill and Ross’ IT Saavy.  For the all important peer interaction regarding Business-IT Integration, consider joining us in Jacksonville FL, March 23-24. 

If you can’t join us in March, but have some ideas, success stories, or warnings you would like to share, please leave a comment, or drop an email.

 

[Disclosure: The Business Ecology Initiative is a client of my firm, Elemental Links.]

Business Ecology: Optimization for Innovation

As I mentioned in my 2010 plans, one of my projects this year is writing and advocacy for the OMG’s Business Ecology Initiative (BEI).  This morning, we launched the new Business Ecology Initiative blog, and I published the following overview post on Business Ecology, the Business Ecology Initiative and Business Ecology enablers. 

As you read the post, you’ll notice several themes common to my on-going writings (soapboxes), which is why getting involved with the BEI is a no-brainer for me.  The original post follows.

What is Business Ecology?

Business Ecology is a business-technology imperative focused on streamlining business processes, removing waste from technology portfolios, and adjusting resource consumption, to optimize business operations and foster business innovation.

As the world economy emerges from a painful recession, organizations are confronted with the challenge of retaining bottom-line diligence, while pursuing market sustaining and gaining innovation. 

For many organizations, the answer lies in harvesting savings and trapped value from existing processes, resources and capabilities.  To accomplish this, organizations are turning to Business Ecology. 

Business Ecology is not a one-time fix, but rather a management philosophy concerned with business vitality over time, balancing current conditions, optimization and innovation focus areas, resource allocations, and longer-term business motivations, capabilities and outcomes.

An important enabler of Business Ecology is the use of technology beyond automation. Business Ecology practitioners employ technology to identify, measure, model and drive business change. 

Business Ecology adoption and execution requires a cross functional team, comprised of business and information technology professionals. Key team capabilities include business process thinking, business performance measurement and analysis, financial analysis, IT architecture, portfolio management, service delivery and iterative project management.

Successful Business Ecology initiatives adopt the principles and values of Business Technology.  The team communicates with each other, sponsors and constituents in a common, business based language.  Measurement is defined and reported in business terms.  Funding and governance decisions and mechanisms reflect a shared resource, investment portfolio approach.

As Business Ecology teams progress, technology and business savvy is exchanged, fostering a greater understanding of each other’s challenges, skills and tools, which leads to a break in the longstanding, constraining, business and IT divide.  A byproduct of successful Business Ecology is business-IT integration.

The Chief Information Officer (CIO), given his/her unique position to view business processes, resource consumption, and technology portfolios across the organization, most often champions Business Ecology adoption and execution.  C-level executives, including the CEO, CFO and COO, sponsor Business Ecology initiatives.

What is the Business Ecology Initiative?

OMG, via the Business Ecology Initiative, leads the drive towards Business Ecology. 

The Business Ecology Initiative provides education, advocacy and member programs to enable organizations to achieve Business Ecology success, employ Actionable Architecture^TM, and carve a path to business-IT integration.

Actionable Architecture^TM brings transparent business methodology to the definition and delivery of common IT infrastructure, platforms and services.  Emphasized business attributes include quality, efficiency, compliance, agility, value, effectiveness, ease of use, sustainability and business goal traceability.

Business-IT Integration is the organizational model for business and information technology convergence.  This model promotes collaborative strategy, planning, architecture and execution; shared decision-making, business-tech savvy personnel and service delivery at the point of value generation.   

What enables Business Ecology?

Techniques: LEAN, Six Sigma, BPM, Value Chain Analysis, Actionable Architecture^TM , Business Technology, Agile, Modeling, Simulation, Business Measurement, and Sustainability Analysis

Technology: SOA, BPM, Cloud Computing, Event Processing, Analytics, Master Data Management (MDM), and Open Standards

Measurement Models: Business Process Maturity Model (BPMM), Sustainability Assessment Model (SAM)

People: C-level executives, business and information technology professionals, who embrace the philosophy of Business Ecology

 

[Disclosure: The Business Ecology Initiative is a client of my firm, Elemental Links.]

IT Savvy: Getting an Edge from IT

The WSJ has published a Business Insight Interview with MIT’s Peter Weill on IT Savvy, his (excellent) recent book, co-authored with Jeanne Ross.  The interview covers a few of the main ideas of the book, standardization for innovation, IT as strategic asset vs. liability, creating digital platforms, and the importance of connecting projects.  A couple of excerpts:

BUSINESS INSIGHT:Your newest book is about IT-savvy companies. How do you define IT savvy?

DR. WEILL: IT-savvy companies make information technology a strategic asset. The opposite of a strategic asset, of course, is a strategic liability. And there are many companies who feel their IT is a strategic liability. In those companies, the IT landscape is siloed, expensive and slow to change, and managers can't get the data they want.

IT-savvy companies are just the opposite. They use their technology not only to reduce costs today by standardizing and digitizing their core processes, but the information they summarize from that gives them ideas about where to innovate in the future. A third element is that IT-savvy companies use their digital platform to collaborate with other companies in their ecosystem of customers and suppliers.

So, IT-savvy companies are not just about savvy IT departments. It's about the whole company thinking digitally.

BUSINESS INSIGHT: You've done some research that suggests IT-savvy companies are more profitable than others. Tell me a bit about that.

DR. WEILL: The IT-savvy companies are 21% more profitable than non-IT-savvy companies. And the profitability shows up in two ways. One is that IT-savvy companies have identified the best way to run their core day-to-day processes. Think about UPS or Southwest Airlines or Amazon: They run those core processes flawlessly, 24 hours a day.

The second thing is that IT-savvy companies are faster to market with new products and services that are add-ons, because their innovations are so much easier to integrate than in a company with siloed technology architecture, where you have to glue together everything and test it and make sure that it all works. We call that the agility paradox—the companies that have more standardized and digitized business processes are faster to market and get more revenue from new products.

Those are the two sources of their greater profitability: lower costs for running existing business processes, and faster innovation.

…

DR. WEILL:  The real secret to IT-savvy companies is that each project links together—like Lego blocks—to create a reusable platform. IT-savvy companies think reuse first. When they have a new idea, the first question they ask is: Can we use existing data, applications and infrastructure to get that idea to market fast? When we look at the impact of reusing processes and applications, we see measurable benefits in the top and bottom lines.

The book also covers defining your operating model, revamping your IT funding model, allocating decision rights and accountability, driving value from IT and leading an IT Savvy firm.  Consistent with Ross and Weill’s other works, the book is research backed and calls out case examples.

Read the article.  Get the book.  Otherwise, risk getting the IT you deserve…

Technical Debt Management: Pay the Interest or Pay down the Principal?

Let’s face it, Enterprise Architects and CIOs don’t always see eye-to-eye.  In my experience, the most common point of contention is “get it right” versus “get it done”.  And of course, this is never an academic conversation, it’s typically a hasty phone call, email or conversation trigged by a “new finding” at a “crucial moment” for a “critical project”. 

At the risk of over generalizing, in these “emergencies”, the deciding factors are time, short-term cost, security risk and short-term technical risk (availability, reliability).  So, if bypassing the architecture gains time, but creates a security or short-term technical risk, then no bypass is granted.  But, if these risks aren’t a factor, well, “get it done”. 

The problem, of course, is that most bypasses are never revisited, and accumulate as expensive, high risk, Technical Debt.  Even worse, most organizations don’t recognize the existence of, nor manage, that technical debt. 

So, how do you raise awareness about mounting technical debt, without being labeled “technology purist”?  Use the inherent “debt metaphor” to build your case in business terms.  Start with a point from Martin Fowler’s recent Technical Debt Quadrant Bliki entry:  “The decision of paying the interest versus paying down the principal…”

The interest is the recurring cost of maintaining a subpar solution that is outside the architecture.  The principal is the subpar solution itself.  Principal is paid down by investing resources to remediate the subpar solution.

Organizations with existing technical debt, need to add technical debt management practices to periodically review the costs and risks of continuing interest payments, versus the costs, risks and opportunities of paying down the principal. 

And for those organizations staring down a “new finding” at a “crucial moment” for a “critical project”, add technical debt to your decision making.  Can you afford to incur additional technical debt?  If so, for how long?

“Pay the interest, pay down the principal, manage your credit line.”  That sounds like a good conversation starter to me...

Straddling the “Good Enough | Crapification Divide”

The current edition of Wired has an interesting article entitled “The Good Enough Revolution”.  The article highlights several successful products – from Pure Digital’s Flip Video Camera to the Predator drone aircraft – where the success was due to a “good enough” mindset.

Good Enough centers on accessibility:

“The attributes that now matter most all fall under the rubric of accessibility. Thanks to the speed and connectivity of the digital age, we've stopped fussing over pixel counts, sample rates, and feature lists. Instead, we're now focused on three things: ease of use, continuous availability, and low price. Is it simple to get what we want out of the technology? Is it available everywhere, all the time—or as close to that ideal as possible? And is it so cheap that we don't have to think about price? Products that benefit from the MP3 effect capitalize on one or more of these qualities. And they'll happily sacrifice power and features to do so.”

Good Enough takes a unique view of technology:

“Speaking at an Online publishers conference in London last October, New York University new-media studies professor Clay Shirky had a mantra to offer the assembled producers and editors: "Don't believe the myth of quality." When it comes to the future of media on the Web, Shirky sternly warned, resist the reflex to focus on high production values. "We're getting to the point where the Internet can support high-quality content, and it's as if what we've had so far has all been nice—a kind of placeholder—but now the professionals are coming," Shirky said. "That's not true." To reinforce his point, he pointed to the MP3. The music industry initially laughed off the format, he explained, because compared with the CD it sounded terrible. What record labels and retailers failed to recognize was that although MP3 provided relatively low audio quality, it had a number of offsetting positive qualities.

Shirky's point is crucial. By reducing the size of audio files, MP3s allowed us to get music into our computers—and, more important, onto the Internet—at a manageable size. This in turn let us listen to, manage, and manipulate tracks on our PCs, carry thousands of songs in our pockets, purchase songs from our living rooms, and share tracks with friends and even strangers. And as it turned out, those benefits actually mattered a lot more to music lovers than the single measure of quality we had previously applied to recorded music—fidelity. It wasn't long before record labels were wringing their hands over declining CD sales.

"There comes a point at which improving upon the thing that was important in the past is a bad move," Shirky said in a recent interview. "It's actually feeding competitive advantage to outsiders by not recognizing the value of other qualities." In other words, companies that focus on traditional measures of quality—fidelity, resolution, features—can become myopic and fail to address other, now essential attributes like convenience and shareability. And that means someone else can come along and drink their milk shake.

To a degree, the MP3 follows the classic pattern of a disruptive technology, as outlined by Clayton Christensen in his 1997 book The Innovator's Dilemma. Disruptive technologies, Christensen explains, often enter at the bottom of the market, where they are ignored by established players. These technologies then grow in power and sophistication to the point where they eclipse the old systems.

That is certainly part of what happens with Good Enough tech: MP3s entered at the bottom of the market, were ignored, and then turned the music business upside down. But oddly, audio quality never really readjusted upward. Sure, software engineers have cooked up new encoding algorithms that produce fuller sound without drastically increasing file sizes. And with recent increases in bandwidth and the advent of giant hard drives, it's now even possible to maintain, share, and carry vast libraries of uncompressed files. But better-sounding options have hardly gained any ground on the lo-fi MP3. The big advance—the one that had all the impact—was the move to easier-to-manage bits. Compared with that, improved sound quality just doesn't move the needle.”

Good Enough is not crapification:

“To some, it looks like the crapification of everything. But it's really an improvement. And businesses need to get used to it, because the Good Enough revolution has only just begun.”

Good Enough | Crapification Divide 

Undoubtedly, the Good Enough revolution will, if it hasn’t already, make inroads into enterprise and government IT shops.  And frankly, the pragmatist in me views this as a positive thing.  However, I’ve spent enough time in the real world to know that “good enough” can easily be (mis)interpreted as “slam something in” and result in “crapification”.

So, for me, the real question becomes: how do you straddle the good enough | crapification divide.  Top of mind, I’m thinking:

1.  Don’t deviate from the “good enough” design points: ease of use, continuous availability, and low price. 

2.  Understand that the above design points – ease of use, continuous availability and low price – are only possible with significant investment (time, talent) in design.

3. Pick a target audience, use case, scenario and stick to it.  Don’t be afraid to be niche or say no.  Better to win over a smaller audience than fail a large one.

4. Don’t force fit the use cases and scenarios where “good enough” isn’t good enough.

These are my early thoughts.  What points would you add to avoid crapification?