I know what you are thinking right now . . . another dinosaur that just doesn’t get it. The problem is I have served as a CIO in state government, and consulted with Fortune 500 information technology companies. I have not been impressed and oddly enough the customers I have seen using these technologies have not been impressed either. Many IT projects never reach completion, costs overshoot what is planned, and never achieve financial results. Here are some causes:
Information technology organizations have the same command and control structure as any other organization.
This means the functional specialization born from scientific management theory (see previous blog). How this plays out are sales quotas have to be met by salespeople and they have powerful presentations, but typically don’t have the product to back it up. Leaving expectations from customers unfulfilled. The promise of business improvement and corporate cost reductions never comes. Rarely have I seen information technology achieve an ROI despite all the conversations about it.
IT companies have their budgets and targets to meet so the customer gets a project plan (typically) and a document to manage scope (can’t have scope creep). If you are lucky, you may see a business analyst that never really sees the work or if software development you will never see the developer (too valuable a resource). Even if these valuable resources did see the work, they don’t have the knowledge to redesign the work just the knowledge to automate it.
IT support is a zero sum game for IT organizations of this ilk. Did you not sign-off on the requirements? Fixing technology issues becomes a game of “cat and mouse” for the IT company, what are customers going to make me fix and what will customers tolerate.
IT customers come from this same command and control mentality.
Almost every information technology purchase I have seen came from the top. Unfortunately, these folks (as well-intentioned as they are) don’t understand the intricacies of the work. These same folks often asked why the front-line people have a hard time adopting new software. Well let’s see they weren’t involved in the decision process, you made their work harder, and change that is not an improvement is forced upon them . . . not gonna like it. This isn’t a matter of getting used to it as most executives surmise.
IT customers want to record incoming work, sort it, scan it, route it and record how long took to do it. Managers can tell you where everything is, how much work is being done by each person, what work is coming in, going out and in backlog. When you look at the work from a customers’ point of view, however, you regularly find it impossible to predict how long it will take to deal with any customer demand. The IT system drives the sorting, scanning, batching, counting routing and recording of work under the misguided assumption it is helping to get the work done.” The value work is only a small fraction of this activity and worse IT customers have to consume additional costs and resources to maintain the technology. Bottom line: managers are making investments in IT without understanding the work.
Understand: Forget about IT . . . treat it as a constraint, not a solution. Perform “check” on the current system. This means look outside-in and end-to-end from a customer perspective and learn about demand, capability, flow and waste.
Improve: Do not change IT. If current work uses IT leave it in place or improve the work manually.
Now, can IT enable this process?
Taking this approach will decrease your investment in IT, make your workers accepting of the changes, and give your organization what they are looking for . . . a better investment for their money.
I recently read an article from Virginia Garcia at TowerGroup that IT investment will be down some 5% in the banking industry. I see other industries with larger drops in IT spending. While this is going on let’s see what we can improve without IT, I believe you will find business improvement and cost reductions with real ROI and be pleasantly surprised.