CIO Inner Voice – The Top Posts
After 1 year of existence, CIO Inner Voice is publishing its top posts. Thank you for all your encouragements, comments and feedback.
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THE GREAT PROJECT MANAGER SERIE - Several years ago, I have the chance to read Jim Collins’ book – “Good to Great” (G2G), that has changed the way I was approaching performance in Project Management. I suggest to share with you my learnings in applying the different concepts raised in this book into the management of Strategic Projects. The 5 key idea sets of G2G are: Level 5 Leadership – First Who, then What – Confront the brutal facts – Hedgehog Concept – The Flywheel and the Doom Loop.
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CIOs – CREATE YOUR BLUE OCEAN STRATEGY - The reason why IT departments might be perceived as cost, could be rooted in the way they act like suppliers: using internal SLAs, launching customer survey, reallocating shared services expenses etc… The market trend shows the irreversible success of outsourcing model versus internal support. CIOs should reconsider their positionning within the Enterprise, and stop competing in the red ocean (see “Blue Ocean Strategy” – Chan Kim and Renee Mauborgne).
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PRACTICE THE DARK ART OF IT INVESTMENT – Companies have struggled during years with the allocation of their investments. Is 50% of them going to business infrastructure a good thing, should we not invest more in protecting our brand or increasing our operational efficiency? One of the underlying complexities is the relationship between level of investment and the expected value we get from it.
The CIO’s Nightmare – Part2 – Rapid Quadrants
The Value of Enterprise Systems - Targeting an improved performance, businesses continue to spend an incredible amount of money and effort to implement large scale Enterprise Systems. But after few years the expected benefits are not always present and the situation is getting worst. CIOs need then not only to justify but also to fix the problem.
Finding a way to quickly assess where we stand and how the sitation can be improved according to changing conditions is becoming the CIO’s Nightmare. Here is a process, I developped to make us dream again.
The approach suggests to:
- Assess the usage and current stance of an Enterprise Systems
- Modelize the different scenario and define strategies
- Develop a proper action plan
2 - MODELIZE
The evaluation of the 2 criterias (In Control & Efficency) being done, we can report the scoring to a matrix which will enable us to capture the different scenerio we need to tackle with.
Risks: With a poor efficiency and low controls, this system/process is in pretty bad shape. This quadrant reflects an organization that did not absorb technology to its processes. It could be for different reasons that will be analyze later. However we know for sure that even if a technical side can be addressed, success in improving the situation will come from the set up and enforcement of a stronger governance.
Potentials: Here the system is in control, however their is an opportunity to be better efficient. Either the organization did not leverage enough the system or the system does not offer such capability. Either way there is room for improvements in such scenario.
Stars: Good controls & Efficiency. The organization should now look beyond the current situation and find out about new potential capabilities that could grow even further their performance. Most businesses can stay in this position for years with a limited investment and discover themselves one day in the risk quadrand.
UFO: Here is a weird situation, that I saw happening time to time. In such situation, I advise to investigate more and restart the assessment with complementary set of information. Most of the time, we discover that the organization was not in control at all of their system.
The simplicity of model provide us with a rapid way of looking at our endavor.
In the next and final post I will suggest a list of variables that will help in building a proper action plan and ensure that strong strategic alignment drives the elaboration of key priorities. I suggest the reading of “CIOs – Manage your S-Curve” prior reading my next post.
I welcome comments and feedback.
The CIO’s Nightmare – Part 1
The Value of Enterprise Systems - Targeting an improved performance, businesses continue to spend an incredible amount of money and effort to implement large scale Enterprise Systems. But after few years the expected benefits are not always present and the situation is getting worst. CIOs need then not only to justify but also to fix the problem.
Finding a way to quickly assess where we stand and how the sitation can be improved according to changing conditions is becoming the CIO’s Nightmare. Here is a process, I developped to make us dream again.
The approach suggests to:
- Assess the usage and current stance of an Enterprise Systems
- Modelize the different scenario and define strategies
- Develop a proper action plan
1 - ASSESSMENT
Assessing the usage and current stance of an Enterprise System (ERP, CRM, PLM, etc…) is done thru a couple of dimensions:
- Is the company “in control” of its system?
- How efficient is the operation in using its system?
This analysis can be performed by critical processes, and operations with the following structure:
IN CONTROL
Sustainability: (From 1 To 4)
From (1): This process relies on few critical personals who if leaving could endanger its stability
To (4): This process is fully documented, robust and new comers can be easily trained
Ownership: (From 1 To 4)
From (1): Subject matter experts are holding separate registeries of information to perform appropriate analysis due to the lack of trust and understanding of current system capability.
To (4): Master data are constinuously up to date and knowledge to update and adjust their configuration is fully documented and owned by the organization.
Decision Making (From 1 To 4)
From (1): Key analysis are performed outside the system which does not offer the foundation for a consistent reconciliation of information.
To (4): Key analysis are performed within the sytem itself which offers a complete an efficent set of reports to manage the entire process and make sound decisions.
EFFICIENCY
Integration (From 1 To 4)
From (1): Multiple entries of the same information is enterred thru the process, leading to mistake and loss of productivity.
To (4): The information is keyed once and flows down to the entire process.
Automation (From 1 To 4)
From (1): Important waste is spent on the lack of automation and integration between the different steps is persistent in the process; and/or the automation is poorly managed and is a source of additional work.
To (4): All the automated functionalities available in the system for this process are exploited, and the systems offers resilient processing.
Digitalization (From 1 To 4)
From (1): Important volume of paper (or Excel/Word) based form are in use in this process, and lead to important filing and archiving activity. Research on history is a complex task.
To (4): A full leverage of digital information is performed accross the process, and is fully integrated within the system. Use of paper is progressively removed accross the organization.
This questionnaire should be complemented by a standard technical evaluation focusing on Cost, Usage and Risks which are becoming standards nowadays and that will not be covered here.
We have all witnessed dysfunctioning systems that are hindering the full development of a business. Despite the investment in a recognized and tested Enterprise System, the company does not seem to reap the expected benefits. Incomplete implementation, lack of training, people leaving, process and organizational changes, poor data ownership are potential reasons amongst others for this failure.
A common approach is to send back consultants to fix the issue. When several sites are concerned it will represent another important investment that the company might have difficulty to accept. Before engaging such money, this simple assessment (cumulated with a technical assessment) could help you to develop a proper roadmap to get back on track.
Stay tune for the second part related to modelization and strategies.
I will be happy to receive your comments on the quality of this questionnaire and for the value of all make it better.
20/20 Foresight: The Origins Of Pattern Based Strategy?
Pattern Based Strategy is the new Gartner’s framework to exploit patterns in the marketplace for competitive advantage. Hugh Courtney in 2001 introduced “Strategic Evolution Principles” which in essence could represent the foundations of Pattern Based Strategy.
The intention of this post is not to dispute the ownership of a concept but rather to point out how the management discipline evolves and adapts according to the context.
In his book, “20/20 foresight – Crafting Strategy in an Uncertain World”, Hugh Courtney highlighted:
Strategic evolution principles … enable companies to evolve successfully … through ambiguous business environments. Sucessful evolution requires companies to be: (a) quick and precise in identifying new threats and opportunities as they emerge, and (b) ready with a set of business principles and organizational norms that will help them make fast decisions and even aggressive commitments despite the high level of residual uncertainty.
Moreover H. Courtney stated that:
Companies can meet these requirements if they follow best practices in four key areas: scanning, experimenting, monitoring and committing.
We can notice, whilst comparing with the Gartner’s model of proactively seeking, modeling and adapting, that a strong correlation in the approach to deal with decision making in uncertain environments exists.
There are some obvious similarities in the two frameworks in (1) the for search of significant signals, (2) the timely commitment of the organization, and eventually (3) the capacity of a company to embrace such models:
- Gartner promotes the critical organizational disciplines to succeed: Pattern seeking, Optempo Advantage (Gartner definition: “Optempo Advantage” represents the set of coherent guidelines and actions necessary for maximizing the alloctaion and utilization of enterprise resources (people, processes and information) , Performance Driven Culture, and Transparency;
- H. Courtney enforces the three vital areas of strategic management: market-and-time based decision making, focused competitive and market intelligence and efficient internal capital allocation.
The transparency attribute is something new and is certainly a conscequence of the serie of events that occured in the financial markets since 2001. What is new as well is the increased maturity of information technologies that are now more prone to probe market signals, to share critical insights at the speed of light, and to develop more than ever the concept of collaborative intelligence. In a way, we might say that gartner used the “Optempo Advantage”.
I always found interresting to see how the business management discipline is evolving by cycles, and its ability to recycle older concepts and ideas; however at each step in the process we are getting smarter.
The important matter is to understand where we come from and how we are adapting to changing conditions in our pursuit of knowledge excellence.
You are welcome to use the comment section to share other models evolution that you have witnessed in the marketplace.
Reference: 20/20 Foresight – Crafting Strategy in an Uncertain World – Hugh Courtney, 2001
Early Watch – Proactive Risk Management
Risk is often approached as a by product of project management, leading to unplanned delays and project overrun. The Risk Waterfall method enables proactive management of risk and define where the true focus of the team should be.
The principle is simple; it suggests a time based analysis of a quantitative risk index.
Most projects are today using tollgates to make decision focus on progress in reducing risk, from all sources. Major risk items must receive early program priority. The issue becomes the evaluation of a valid quantative risk index.
Risk is often considered as the product of probability of occurence and degree of impact. Also this definition is correct, it fails to address the natural complexity of projects such as interdependencies between risk and the time planned to resolve the risk.
The risk waterfall method is proposing to measure risk as
UNCERTAINTY * IMPACT * N° OF DEPENDENCIES * TIME CRITICALITY
Where :
- Uncertainty & Impact can be evaluated with the scale of 1 to 5 (Low to High)
- N° of dependencies is found with the N-Squared chart row by row (See graphic)
- Time Criticality is the penalty for late resolution of a risk and is calculated as 2 power N, where N is the closest tollgate review after the time that the risk is planned to be resolved (With 6 tollgates N=0, 1, 2, 3, 4 or 5)
If now you represent this new quantitive risk index on a time scale (with tollgates), you can easily decide which risk the team should focus on and elaborate a mitigation plan based on its complexity and our ability to fix it.
Of course this evaluation should be a continuous process; exceeding planned tolerance should trigger an unscheduled interim review.
I used a lot this tools during my carreer, and found it a powerful mechanism to better integrate risk management in project.
CIOS – 2010 Predictions That Could Change Your Life…or Not
1 – With the raise of social media and the illimited access to people information, “CIO” will stand for Chief Investigation Officer.
Pete Cashmore in October 2009 made social media holding the smoking gun of Privacy and concluded his post by “Twitter, Facebook, Flickr, Foursquare, Fitbit and the SenseCam give us a simple choice: participate or fade into a lonely obscurity.” Not sure I fully agree with this. Internet memory is certainly the biggest danger of individual’s privacy and everybody has the right to oblivion. Don’t you think?
2 – Someone smart will say “Free is too Expensive” …. if it is not already done.
[add on] – We do not need to wait anymore, 6 hours after publishing this post we could find on Google “Newspaper publishers told “Free is too Expensive”“.
3 – The accronym D.I.Y. (Do It Yourself) will be a standard answer in corporate emails.
See the “2010 Consumer Trend Video“, you will find interresting insights that should be understood even by B2B Businesses.
4 – Jim Collins will publish his new book “From Fall to Greatness“
It might be followed by “From Fall to Greatness – For Public Sector”
5 – The first clinic program for Twitter’s Addicts will be proposed….
Not sure about the country yet. But Netherlands could be a good candidate as Dutch already opened a detox clinic for video game addicts in 2006.
6 – IBM will still be there.
7 – Steve Ballmer & Eric Schmidt will tweet on their personal iPhone
I recommend the article “The Great Iphone Death Watch” which gathers numerous statements about the predicted failure of the iPhone in 2007 by the big Guys.
8 – CIO inner Voice will still be around for you…
Let me finish by a video I particulary enjoyed.
The Digital Competitive Advantage Of Organizations
Positioning strategically IT within the Enterprise is at the heart of many CIOs concerns. In these turbulent times, it is not uncommon to see IT relegated to its sole cost element. Conversely, strong signals exist to prepare companies for growth. Here is the opportunity for CIOs to reap the benefits from the situation and identify the Digital Competitive Advantage for their organizations.
Making a board acknowledge the value of IT has always been a difficult exercise for CIOs. Current economic pressures and global uncertainty makes it even harder. The current cash flow focus challenges any investment with a short term view, potentially exposing the company to future risks. Conversely, we need to admit that this systematic questioning of where we spend has value and lead to a critical Quest : “What are these Strategic/Core Resources we should be protecting?”
Time To Change
For many reasons, most of IT organizations elude this question and focus on the cost/quality service ratio. It is now time to challenge our approach and offer our business different perspectives. “What are our core IT resources that will provide a sustainable competitive advantage? ” – “What type of resources should we leverage: Organizational, Process, Technology” – “How do we define Core?” These issues should be fully integrated in the screening process of any IT related investment process and spend analysis.
Defining Core/Strategic Resources
It fits in with the “Resource Based View of the Firm” introduced by Wernerfelt B. in 1984 and how Valuable, Rare, Inimitable and Organized (VRIO) a resource can be. A core resource should meet all of these criteria.
A resource is Valuable if it helps the organization to address an external threat or exploit an opportunity. Rare if it is not widely owned by other competitors. Inimitable if it is difficult for another firm to acquire it or a substitute something else in its place. Organized if the firm is able to actually use it.
What is it about IT?
Most IT organizations have articulated their strategy (see “Is There Such Thing as IT Strategy Anymore?“)around the value of IT which fulfill the first criteria of (V)RIO, but let the others on the side. Value is driven at the pace of economics, and objectives like efficiency, quality, customer responsiveness, and innovation are inevitably calibrate on the expected Return on Investment. However criteria like Rare & Inimitable required a focus on long term.
The Digital Competitive Advantage (DCA)
DCA is the ability of organization to grow and exploit the IT resources that fulfill the CRIO criteria. Think about your next strategic workshop and identify what part of your IT culture, leadership, solution portfolio, reputation, organizational expertise make you deliver this Digital Competitive Advantage and make your business outperform the competition.
Pattern Based Strategy: A new Hype?
Pattern Based Strategy is new framework launched by Gartner to pro actively seek, model and adapt to leading indicators that form patterns in the market place.
We must admit that Gartner has been very creative lately to create new hype: Cloud computing, Enterprise architecture, and now Pattern based strategy. Beyond the promotion itself, we can see an emerging demand to reassure the business community to anticipate what tomorrow could be.
Predictive Business Intelligence is one element in the equation, but a fundamental shift in the way organization are planning need to happen, and it could be done by integrating the necessary variability of risk whilst establishing a path for growth. An approach by scenario is suggested by Gartner to accommodate this uncertainty.
Will BI market be the sole winner of this trend or will we assist to the birth of a more fundamental change in the way organization are managed?
You can see a video here of Peter Sondergaard (SVP Research). If you are interested on the subject find below some additional resources on the subject:
- “Gartner Identifies Four Disciplines of Pattern-Based Strategy“
- “Gartner Says Companies Must Implement a Pattern-Based Strategy to Increase Competitive Advantage“
You can read a post that I wrote early this year that was suggesting a similar approach:
… Last but not least, reactivity has been pushed as a strategic enabler for growth, and if the vendors are quickly adapting, internal IT might have issue to address this need. While being reactive is certainly a good thing, being proactive is even better. IT has focused for decade on monitoring system that support the business. Why not changing the concept and establish a Business monitoring. There is tone of information present in systems today that are not exploited and could be the basis for pro-active analysis. Developping this competency within the organization memory could create tremendous value for organizations.
Looking forward for your comments.
Access Gartner Market Researches For Free
Gartner is the leading information technology research and advisory company. They
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publish well known reports such as Market Scope and Magic Quadrants. Here is a simple way at no cost for you to get these documents.
When technology providers are mentioned in these famous reports they pay a right to reprint and allow people or companies that let their contact information to access the publication. Gartner is providing a hosted environment for these suppliers and their related customers to obtain their researches.
The Hint
The IP address of this site is http://mediaproducts.gartner.com/reprints. I found out for instance the “Magic Quadrant for IT Project and Portfolio Management” (2 June 2009) @ http://mediaproducts.gartner.com/reprints/ca/article3/article3.html.
The Tip
Looking at this URL, it was tempting to test if by increasing or decreasing the article number, I could access other reports. And guess what it works. You can use this technique and replace “ca” by “bmc” or “oracle” for instance.
Other like “Microsoft” and “sas” are important consumer of Gartner and they have volume like “http://mediaproducts.gartner.com/reprints/microsoft/vol6/article15/article15.html” or ”http://mediaproducts.gartner.com/reprints/sas/vol5/article15/article15.html”.
Don’t forget to have a look at the great comments and let me know what you found.
Investment Strategy: Seed or Leverage
I always felt that the way companies are looking at their investment portfolio was somewhat missing perspectives. Focusing their needs on the current year, without any red flag mechanism (See “Confronting the Brutal Facts“) showing the limit of their investment strategy.
There is a good practice that could enable Enterprise to understand when the tipping point is reached, and when return on investments could only decrease.
Whilst investing in new performance businesses are either using past investments to grow further their return (“Leverage”) or either setting up a new platform on which future investments can easily deliver incremental benefits (“Seed”). The S-Curve theory concurs to this approach. (See “The dark Art of IT investment“)
For example following the implementation of an integrated package (such as an ERP); which will streamline the processes and improve data management, a quality department can then tackle with uniform management dashboards across business units which will trigger additional benefits. Investment in such ERP platform (“Seed”) enabled a future investment in quality dashboard (“Leverage”).
Whilst considering a balanced investment strategy, leaders should focus on which part of their investments is related to “seed” future performance and which part is to reap benefits and leverage. “Seed” investments should always be measured and control over a long period, and challenged by new opportunities that could deliver better incremental benefits.
During your next annual plan try this practice by identifying “Seed” and “Leverage” investments related to new performance. You might get signals that might change your approach of investment.
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