Category: Vision and Leadership

Your Start of the Year Leadership Checklist

    Jim D

Just as I published a quick checklist for you to use as the year was closing, here is a checklist for your first week back to help you get off to a great start of the new year.  Plus, this is a lot more fun than taking down those outdoor Christmas decorations or doing returns of the unwanted gifts. So before the office gets busy, use your first few weeks to get a jump on outstanding results in 2012 with this list:

1. Remember to get the things done we planned in December. You have booked time in January with your team to do the detailed planning to ensure you have the IT goals for 2012 clearly defined with the key steps to get there. Knock it out with your team.

2. Set your 1st and 2nd quarter virtualization goals for your server and storage and sit down with them and ensure they are mapping out how to get it done. Get them off to a quick start.

3. Pick one or two major contracts to renegotiate in your favor this quarter. A quick hint: Oracle missed expectations last quarter so you may have an opportunity. Remember to hold tight, put something new on the table to get the most out of a deal, and insist on your terms and conditions (and if your company does not have an up-to-date contract template, put that on the plate with your Chief Procurement Officer to get it done).

4. Take those new insights that you gained from your holiday vacation (remember you were going to spend part of your vacation time reading a good management or IT book) and ensure you bring the view to your planning meeting.

5. Review your January schedule and ensure you have time with your customers fully scheduled. Invite one of them to kick off your planning meeting.

6. Also review the planning meeting agenda with your boss and ensure you capture any ‘messages’ he/she wants to make sure come across.

7. Sit down with the intranet team and ensure they are adding 1 or 2 helpful ‘widgets’ a quarter to your intranet site. Start with a ‘How do I …’ list button or improved search tool, or a wikipedia for corporate terms and abbreviations. The little helpful things mean a lot to the productivity of your company’s employees.

8. If you don’t have BYOD yet, sit down with your client device team and review the plans to pilot and then implement it this year.

9. Schedule a visit for you and several of your team to review either a customer facing site (call center or retail store) or a key operations facility for your company. Ask questions and see how IT is working where the rubber meets the road in your firm. I am certain you will learn plenty.

10. Review and report on your performance for the past year – do it with thought and be provocative. Challenge yourself and your team where you have not delivered well. Then follow up with a high level and positive note to your entire team talking in broad strokes about the goals for the year. Strong communication at the start of the year will help ensure you and your team are lined up for success throughout the year.

Many of these items are reconnecting activities: with your business, with your customers, with your boss, and with your team. Before you start off on any major endeavor, it is critical to recheck the plan and the communication lines — that is in essence what we are doing. And with it you will be much more likely to have a successful and rewarding 2012.

All the best, and roger on those plans! Jim

Your Year End IT Leadership Checklist

    Jim D

I think we can all feel the holiday and yearend swooping in and things winding down where we work. The Christmas parties are in full swing and everyone is focused on making sure they get everything on their Christmas gift list. Next week is certain to be quiet in the office. For senior IT managers, here is a quick list of things to do as the year-end approaches:

1. Vacation overlaps: Re-check that you and your senior team are not all out on vacation and no one is left to mind the shop. If there’s a gap, given the timing, you need to be the one to fill it (besides, this way you’ll have an excuse when your spouse asks you to go to the store with return items).

2. Batch Cycles: With the upsurge in retail sales and other peaks this time of year, ask the production batch team to re-calibrate the peak processing time for batch runs in December, month-end and year end. It’s better to find out now you need to address capacity than at 3 am Sunday morning in the New Year and your company can’t close the books on time.

3. Feedback for your team: Spend some of your vacation time writing thoughtful performance reviews for your team. Start with your best and worst performers, they will get the biggest positive impact from a better writeup this year. For outstanding insight on competencies and how to coach, check out FYI: For Your Improvement by Lombardo and Eichinger.

4. Gain new insights: Spend another part of your vacation time reading a good management or IT book. The new perspectives experienced will help your fresh thinking in the new year. If you are looking for ideas then perhaps Magical Mathematics or The Rare Find or perhaps Great by Choice.

5. Start out proactively: Book time in January with your planning team to ensure you have the IT goals for 2012 clearly defined and map out the steps you will be taking to communicate it broadly. Otherwise you can get caught up on the first assignments that come in the door in 2012 and remain reactive the entire year.

6. Allocate the time for your customers: Ask your admin to ensure you have regular meetings scheduled every month with all of your business partners. You may already be doing this, but regular sessions are key to keeping in touch and providing great service.

7. Thank the team: Take your team out for a drink and thank them for the accomplishments for the year. Keep the evening clear of any assignments or negatives on missed deliveries. Everyone needs to be thanked and appreciated, and you’re likely to do enough ‘coaching’ of them the rest of the time.

8. Thank your admin: Your admin is the primary interface by which most people interact with you. If she or he has done well, make sure you thank them. And a nice gift is very reasonable — and ensure they do not get you one either. This would be on top of any formal bonus.

9. Thank your sponsors: Spend some quality time with your boss and whatever the challenges for the year have been, thank them for their support and the opportunities they have given you. Let them know you will be refreshed and ready to go for the new year.

10. Take time for yourself and your family: Make sure you take the time to decompress and reflect. Do whatever you need to do to relax and recharge. Focus on your family. Think about what went well and not so well. Identify the key things about you that you want to change in the new year. Save the how for another reflecting session. Make sure you walk into January with renewed strength and vigor and a focus and game plan on the new you.

For some of you, you have already either completed or will knock off all 10 items. For others, perhaps you have nearly all of them, but there is one or two items you can add to your list. If you are doing less than 5 of them, you need to make sure you do #10 so that you personally are ready for next year.

I hope your year has been successful and rewarding. And I trust that this blog has provided some insight for the last part of the year. Next year, I plan to make to continue to provide the regular posts and insights but have the best practices sections well-developed to enable a quick reference guide for IT management for you and your team.

All the best, and have a great holiday, Jim

 

Too busy to be productive? Traps of our modern world

    Jim D

There was a very good article in the Wall Street Journal yesterday on ‘How to Save an Unproductive Day in 25 Minutes’.  I found it useful that the article points out a few techniques to keep that day from being a complete loss. But while the authors pointed out a portion of the cause of unproductivity (fragmentation and interruption), they failed to really pin down why so many of us struggle to be productive at work. Or perhaps to put it another way, why so many of us spend nearly all of our time killing alligators and spend so little time draining the swamp. This tendency of being ‘too busy to be productive’ finds particularly fertile ground in IT organizations.

The reason this is more prevalent in IT teams is because in IT there are are the usual ‘urgent’ distractions of email and phone calls and business meetings AND there are additional and very real urgent distractions of production issues and high priority projects that are running late but must be completed on a specific date. Thus, the opportunity and time to do important foundational tasks is even smaller. As a result, I come across many IT teams that are running at 100 miles an hour, not doing a good job of delivery of production or projects and their teams are at or close to burnout. And yet the solution to this very real and overwhelming issue is close at hand for IT leadership to leverage.

To solve this ‘too busy to be productive’ issue, you must address it on two levels: for your self and for your team. If you are running around with your hair on fire, then no amount of coaching by you will change how your team approaches their work. Let’s start with the knowledge that we will be able to change both your productivity and your team’s dramatically in two to three months. Understand that going forward, things that are important (and may or may not have a critical time deadline) will take precedence over everything that tends to interrupt but is not important. And you must demonstrate this improved choice everyday for the next 3 months. Here are the steps to get you and your team out of burnout and delivering with much greater quality and capability:

For you:

a) First, get your calendar balanced. Take your calendar for the next two months and let’s implement some radical changes. First go through your calendar and categorize your activities as either important or not important, reactive (dealing with a crisis demand or the fallout of an issue) or proactive (e.g. planning or addressing root causes). After categorizing, it would be interesting to see how much time you are spending on important and proactive work. My bet is it is less than 25%. And it is even less than that because the first part of the meeting focuses on today’s production failure rather than the planning work you were going to do. Next, either delegate or eliminate all the not important meetings from your calendar. Then, at least 3 times a week allocate 2 hours for important proactive work. Ensure you cover the areas you know need the most attention. If production is a problem, then spend two hours on root cause and how to improve change quality. If project delivery is a problem, spend an hour with your key team reviewing your project metrics and constraints affecting delivery and how to solve them. Spend at least 1 hour per week ensuring your key goals for the next 3 months and the next year are clear, and craft the messages to ensure they are well-communicated. Spend another hour figuring out how you can improve or coach your team to better performance. And stop doing every email and phone call that comes in. You do not need to meet with vendors for new products and solutions when you are having issues with your current delivery. At least half of your emails never need to be read or responded to – ignore them. Stop interrupting your meetings due to phone calls unless it is your boss or a very important customer.   Throughout your day, continually evaluate if you are spending good, solid time on important proactive work.

b) Make clear decisions and ensure you empower the team to execute with quality. Sometimes the cause of the productivity issue is a team caught up in over-analysis. If you are not making clear decisions or if you are making micro-decisions then you can cause your team to do 200% of the work necessary as they try to buttress their recommendation and collect every data point possible. Or the team may abdicate doing work they should do because in the end, they know that you will overrule them and make a micro-decision. Be self aware enough that you are causing these effects. If, in the past three months you have either recalled previous decisions more than once or sent multiple decisions back for more research than either the team is inadequate or you are not decisioning effectively. Sound out with a trusted colleague or coach if you need to improve your decisioning process. The bottom line is that you must stop requiring or doing unimportant analysis work or decision work. Let your team make the decisions for the areas they are accountable for and stop requiring perfect facts to make a decision in this imperfect world.

For your team:

a) First, set goals and expectations that i) you want them to deliver with quality and ii) you will support them to fix things so their work can be done in an improved manner. You must let them know that not only is it ‘safe’ to do things with quality, it is expected. Your team and organization may have fallen into the trap of thinking the only thing that is important is that work must get done based on the timeline, even if it means slamming something in that is riddled with defects. By insisting on quality first, you put your team on notice that this is foundational. Now, it should also be noted that this is not a pass to then have endless delays and no accountability to deliver. Instead, you must work hard to deliver in as timely a manner possible, but with the quality.

b) Use the proactive important time or your calendar to work with your team on the things that will improve how the work is getting done. Are your processes convoluted and time-consuming? Then spend time with the team to straighten them out and lighten the load. Are the tools inadequate? Then figure out what is best practice and pilot an improved set. Are things going in with lousy quality and causing production issues and lots of rework? Then stop letting poor quality change in and fix it before production. Do this even if it means a train wreck on a promised implementation date with the customer. Go and personally talk to the customer that quality is too important to you and to him or her. (I have never met a customer who remembered they insisted something go into production when it was known poor quality and instead blamed IT. Conversely, if you delayed something by a few weeks or even months yet it went in with quality, 6 months later, they invariably remember the successful launch versus the delay.) Spend your time with your team draining the swamp.

c) Set their goals and their schedule leveraging the fact the people do urgent things first. In other words, it is a natural tendency to focus on the urgent things like email instead of getting a backout plan done for a change or mapping out how we improve our development process. So, as the leader, set clear deliverables and clear dates and accountability for the important things (thus making the important and proactive work important AND urgent) for your team. It is a very effective management technique. Then, you will find that much more of the proactive work will get done.

Watch what happens then as a virtuous cycle takes hold. Because implementations start to get done with more quality, there is less fallout and production incidents. With reduced demand to work production issues, your team should have more time and focus on doing more proactive work (you must do (c) above to get this effect, otherwise they will just do more email or other urgent and unimportant work). And as they do more proactive work, they eliminate bottlenecks and rework and become even more productive. This cycle will take a few months to gain traction. And if your organization is really in a rut it may take as long as 6 months to show measurable difference. But usually, the effect is much quicker, and the first lift can be outpaced by the second and third and subsequent lifts as the cycle repeats. I recall one infrastructure component team that had a terrible production track record, the rest of IT viewed them as a bottleneck in the project process and the team, being close to burnout, saw no solution except to double or triple the number of staff. By implementing this approach, within a few months their change success rate went from the mid eighties to better then 99% and they trimmed their implementation processes significantly in terms of effort to deliver a unit of work. Everyone understood what their goals were and what was important to get done to be successful. And when I asked one of the managers to compare his team’s work to the state three months prior, he said ‘It is night and day. I can get all the important work done and our implementations go smoothly. I no longer spend every evening on a bridge call trying to figure out why something is not working. And I come in the next morning refreshed and productive. My week is in a box.’ This was the result in just a few months.

It can be tough in IT with the press of production incidents and the pressure of critical project deadlines. Add to that our everyday distractions of email and mobile devices and trying to keep up with the pace of technology and we soon lose the forest for the trees. Perhaps the best treatise on this effect is in ‘The Seven Habits of Highly Effective People’ by Stephen R. Covey and his time management matrix.  By leveraging this knowledge of techniques to ensure we work on the important things versus the unimportant but urgent, you can be a better manager and your teams can be more successful and have their week in a box. You might even buy copies of this book for your managers so they understand what is happening themselves and learn personal techniques to address it.

All of us undoubtably, have had some experience where we felt trapped in an overwhelming level of work and no real way out. How did you solve this? Do these approaches resonate with you? Have you employed them to change your team in a sustaining way? I look forward to hearing from you.

Best, Jim

Getting Ready for 2012: A few things to add to your technology plans

    Jim D

By now, you have submitted your budget for 2012 and hopefully have an updated set of business and IT goals. And even if it is not final, you have a solid draft and good understanding of what you must get done in 2012 to be successful. So, here are several things to add to your technology plans if you are not already doing them:

Give them BYOD: If you have not enabled your company’s staff to do their work on their own mobile device yet, put it in your 2012 first quarter plan to pilot it and then to roll out in 2012. This is an easy win — it saves your company money and it enables your users to use the device they want to use and be more productive. Not sure how to begin? Here is one reference on how and another on the trends. And check out the prevalent toolset being used at Good Technologies.

Implement more self-service: An oft-neglected area is the improvement of your support functions and their productivity and service. In a typical corporation almost every employee is touched by the HR and Fiance processes, which can be heavily manual and archaic. By working with your Finance and HR functions you can reduce their costs and improve their delivery to their users through implementation of automation and self-service. Continued improvement in workflow toolsets from Sharepoint to Lombardi mean you can automate and put on your intranet more and more minor business processes than ever before at far less cost and effort. The end result is lower operations costs in HR and Finance, a more satisfied user base, and a better perception of IT.

Topgrade your team: With the weak economy of the past several years, and your budget being under pressure, there is significantly less turnover of personnel, even in IT. Don’t wait for the upturn to improve your team. Ensure you have rigorous improvement plans for the mediocre performers on your team. And if there is no material improvement, look to topgrade. Now is the time to replace poor performers with strong new talent. Don’t wait for the economy to fully turn around and growth to be required, everyone will be looking then, and it will be much harder to get the best talent.

Virtualize everything new: Perhaps you have made good progress on virtualization and are now above 40 or even 50% of your servers being virtualized. You should be able to get this to 80 or even 90%. How? Presumably you have projects in your 2012 budget to tackle some of the remaining significant pools of legacy servers. That’s great. But make sure you close the barn door. Insist that every new project must use virtualized servers and storage. And any exceptions require CIO approval with strong business case rationale. You want to use fiats sparingly, but this is one case where the change in behavior from every project thinking they must have dedicated infrastructure yields outstanding benefits across the board.

Start an intern or graduate program: Often, intern or graduate programs are the first areas to be cut when times get tough. Yet these programs enable you to bring on skilled resources at very low cost to assist your team. And you should really view them as extended interview sessions where you have productive work being done during the interview. As you should be keenly aware, the IT unemployment rate is quite low, this summer it was 3.8%, which is basically close to full employment. So, in order to get a jump on the best grads this year, start or expand your intern and graduate program. By bringing new talent in the door, you will reduce your overall, average IT staff cost, bring in new ideas and fresh energy,  and contribute to your community and local education institutions. A win-win-win all around.

Do some fun awards and incentives: Let’s face it, things are tough and have been for several years. The economy, the global situation (e.g., Euro), and the housing crisis contribute to a dour mood. And the upcoming yearlong political campaign in the US will only further heighten the general negativity. Your workforce though will not be as productive in this downtrodden mental state. So make a difference in 2012. Have some fun and celebrate successes, even smaller ones. Provide some fun and low cost rewards for your teams that meet your goals and values. And providing some fun recognition is a key retention factor for your best staff. Don’t make the mistake of rewarding the arsonist for putting out the fire he set, so ensure that you consider the means as well as the ends on any effort. But have some fun, make it unique, and reward the team!

Business intelligence: One last item to check to make sure you have it in your 2012 plan is leveraging the data you already have to know your customer better, improve your products or services, and reduce your costs. Why have advertising for customers who never click through or buy? Why do customers call your call center when they should be able to do it easier online? Knowing your customers and knowing your products and services requires IT to partner with the business to leverage the data you have to obtain intelligence. Investing in this area should be a key goal for 2012. If you are not doing much here, then I recommend finding out what your competitors are doing and sitting down with your business partners to sort through what you must do. Add it to your list.

What would you add to the 2012 plan? What are your highest priority areas for 2012? Risk and Regulatory? Growth and new product? Or Cost and Efficiency?

Share your thoughts, I look forward to hearing from you.

Best, Jim

 

 

 

 

 

 

 

 

Delivering Efficiency and Cost Reduction: Long Terms Tactics Wrapup

    Jim D

In the last several posts we have covered how you should deliver IT cost reductions with long term tactics that also enable you to build capability and capacity.  If executed well, you will also yield some longer term benefits such as a better workforce balance or elimination of redundant or low value systems. These tactics require relentless leadership and focus by you. You must keep them in the forefront and ensure you are progressing on them everyday. Your patience and influence are required as well. You must obtain business support for efforts that often have a longer cycle than the business team is used to supporting.  If you are both consistent and persistent in your approach, and employ these tactics, you will make a material difference, in some cases a massive difference, that will make your business far more competitive and is simply unattainable through other approaches.

We discussed that these long term tactics are executed by first laying a groundwork for sustainable improved cost through quality. Second, you build a highly productive and well-balanced team in order to meet a world class cost profile. Throughout you leverage metrics-based, transparent framework with continuous process improvement that enables you to progress and achieve world class performance. A concurrent effort with building a high performing team is to migrate to a modern, consolidated infrastructure and well-architected core systems. We will discuss this effort today and wrap up our efficiency discussion.

Nearly every IT shop that has quality or cost problems has a proliferation of archaic systems and fragmented, legacy infrastructure. The causes of this are myriad but generally result from: poor or shifting business vision and sponsorship (e.g., when you have 3 different sales executives in 4 years, IT delivers 2 and 1/2 application systems trying to match the business variances and results in multiple systems that never do what was needed); an inability of the business to invest in a steadfast manner (e.g., IT projects run out of funding, or funding shifts, thus every year projects are half completed resulting in the old systems staying in place with the new systems going in); a stagnant IT team with poor best practices and leadership that allow multiple mediocre solutions where one good solution would suffice.

As the IT leader, you must tackle the business causes first before setting out to fix this area. Draw up a compelling vision of what the systems should provide. Research and gather the facts on the costs, time to market impacts, business productivity, feature loss and quality issues due to the current multiple mediocre systems. Map out a new process and authorization where you get the multi-year business support and sponsorship to execute the vision. Going from three mediocre overlapping business systems to one well architected systems with better quality will enable efficiency and productivity gains across the board — in your shop and in theirs. This is a vision that you should get everyone to rally around. Ensure there is a investment process that enable multiyear funding and review of major projects and conversions that also tracks to ensure the benefits are delivered. The CFO should be your partner in this. It is in his interest to see that everyone meets the costs reductions and other benefits promised. And it is in yours as well, because often you accumulate the layers of barnacles by only doing 80 or 90% of a project and not doing the final steps of decommissioning the old systems. By having a multi-year project process with benefit review or scorecarding in place, there will be far more impetus to ensure projects are completed and old systems removed.

Assuming you address the business sponsorship and project process issues, you must also address poor leadership and implementation on your side. First and foremost, IT cannot be a place for ‘hobbies’. That is, you need to ensure that all those pet technology projects and explorations that are not absolutely critical to a business capability or technology implementation that has real, near term benefits, are killed. Otherwise, they are a distraction and a multiplication of your technologies and thus costs.

Second, require every major application area and infrastructure component to map out current world and a future world where they are consolidated and at best practice. Then sit down with each team and your architectures and lay out the trajectory to get from today to best practice. Estimate the benefits from the transition. Ensure you capture the gains from your productivity and quality improvements. Then pick the top 3 to 5 areas and target them as major transformation initiatives for investment and turnaround. Garner the business support, get the approvals, make it part of your IT goals and communicate the importance to your team. And of course execute them. But also, in the other areas that mapped out their trajectories, work with them to come up with ways to make progress without major funding. Identify and execute the quick ROI projects that enable you to save within the year or almost within the year. Work with vendors to come up with creative ways to overcome the investment hurdle to move your technology to a best in class platform. And every time you can come up with efficiencies or savings elsewhere, turn around, pull the next best consolidation and replatforming project off the queue and get it going. As these projects execute and land, it will drive a virtuous cycle of additional savings and quality that will enable you to more rapidly transform as well as to shift, over time, more and more resources to the point of the spear where you are attacking the business problems and needs.

The long term tactics will take 9 to 12 months to achieve some results and 18 to 24 months to yield impacts, but once you really start executing and implementing, the compound gains can be enormous. Given IT can be a very large cost center within a corporation, IT can often one of the top contributors to cost reductions. And given IT systems availability and quality drive customer service, IT improvements can be the biggest push behind improved customer satisfaction. These are huge wins for you company. So, as you are faced with cost efficiencies demands of todays environment, leverage the near term and long term tactics described to put you and your company in a winning position.

So, we have spent nearly two months covering the very important topic of cost efficiency in IT. Every IT shop today is faced with these demands. You now have the tools to drive this far more effectively. Let me know where things have gone awry or where more detail is need to handle the complexity of your situation.

Best,

Jim

 

Delivering Efficiency and Cost Reduction: Long term tactics

    Jim D

We have spend the past several weeks covering how to deliver efficiency and cost reduction in IT, and particularly how to do it while maintaining or improving your capabilities. In my last post we discussed what are some of the recent technology industry trends that enable reduced costs at the same or improved capabilities. In this post we will cover the first two of the long term tactics that you can leverage to achieve world class cost and performance: quality and a high performance team.

The first and really most important area to tackle is quality. If a factory had a quarter of the output that it produced was defective and became scrap, it could no long compete in the lean manufacturing regime of today’s industry. Yet frequently, IT shops have defect rates of 10%, 20%, or even north of 50%. And much of the time and effort of the IT team is actually spent fixing things as opposed to new work or proper maintenance. You need to regard every defect in your shop as waste and as a cost to you and your business. You should tackle this waste wherever it occurs in your shop. It is not uncommon for more than 50% of large projects or programs to be over schedule and over budget. It is not uncommon to see shops where more than 10 or 20% of the changes result in some other problem, typically impacting production and service to the customers. These areas must be addressed with rigor.
For projects and programs, are you following a robust project methodology? Do you have proper sponsorship and governance? Are you leveraging a strong analysis and requirements management methodology and toolset? Are you taking advantage of modern methodologies that solve the tough parts of a problem first, get good prototypes out early for user review and avoid the big bang and timeliness issues of a waterfall approach? Are you giving your project managers a full toolset along with the industry training and empowerment to make the right calls? If not, then you are likely experiencing issues and delays on more than 25% and perhaps more than 50% of your projects. And that is where your money is being wasted. When a fully staffed project team is waiting for requirements signoff, or when requirements are being changed again, too late in the project cycle, you are burning project monies while the resources idle or have to do rework. By introducing a rigorous process and robust tools and metrics, you will be able to avoid most issues before they start and for those that do occur, you will know precisely why and be able to correct it for the next project.
For your production services, you should insist on at least a 98% change success rate and if you wish to be a 1st quartile shop you need to drive to a 99% or 99.5% change success rate. This means that for every 200 changes only 1 or 2 fail. These success rates can be achieved by ensuring you have an effective but not burdensome change process and you have rigorous change testing and planning (including a backout plan). Have your operations and service management experts participate in and provide guidance to those making the changes (either the application areas or the infrastructure teams). And ensure full root cause on any change that fails with the requisite actions to prevent re-occurance being completed. Publish simple and straightforward reports on change and project success and quality. By measuring quality your team will get the message and place much more emphasis on getting it right the first time. And remarkably, by focusing on quality first, you will get a strong reduction in cost (whereas if you first tried to reduce costs then to improve quality you would make little progress on either). Accompanying this thrust with simple but bedrock true messages such as ‘Do it right the first time’ and ‘Spend it like it is your own money’ go a long ways to get the spirit of what you are trying to get accomplished across. You must mean it though and you must back up doing it right, even if it costs more initially. Remember you are looking to establish a quality culture and achieve longer term returns here.

The other long term tactic we will discuss today is achieving a highly productive and well-balanced team. First, understand that while you are implementing longer term team plans you should leverage some or all of the near term tactics for staffing that I identified in the October 31st post. The long term tactics are straightforward and are based on you attaining a staffing mix that is composed of a balanced mix of top performing individuals who, for your company, are in the right geography and at critical mass sites.

Some key truths that should be recognized and understood before setting out to build such a highly productive team:

– top performing engineers, typically paid similar as their mediocre peers are not 10% better but 2x to 10x better

– having primarily only senior engineers and not a good mix of interns, graduates, junior and mid and senior level engineers will result in stagnation and overpaid senior engineers doing low level work

– having a dozen small sites with little interaction is far less synergistic and productive than having a few strategic sites with critical mass

– relying on contractors to do most of the critical or transformational work is a huge penalty to retain or grow top engineers

– line and mid-level managers must be very good people managers, not great engineers, otherwise you are likely have difficulty retaining good talent

– engineers do not want to work in an expensive in-city location like the financial district of London (that is for investment bankers)

– enabling an environment where mistakes can be made, lessons learned, and quality and innovation and initiative are prized means you will get a staff that behaves performs like that.

With these truths in mind, set about building the team by addressing your workforce strategy (sites and mix); upgrading your recruiting and performance management; and revising your goals and rewards. Then execute these relentlessly while you up the training and coaching. As this begins to bear results you will then need to prune the poor performing managers and filter out the low performing staff.

So build a workforce strategy that matches the size and scale of your company. If your company is global, you will need a global workforce. If it is domestically focused, be domestic but look at near shore engineering locations as well. Establish the proper contractor staff mix based on function (again see the near term efficiencies staff post). Ensure your locations match up to where you can draw talent. For example, minimize expensive in-city locations. Choose instead locations with good commuting, very good nearby engineering universities and vibrant nearby communities. You will be rewarded with better quality engineers and lower attrition. Do you have 12 locations each with 50 to 150 engineers? Consider consolidating to 3 or 4 sites each with 300 to 500 engineers. And one or two should be global or near shore sites. And ensure you set it up so any significant IT function is done in two locations (thus eliminating the cost for BCM and establishing opportunities for work handoff between the sites yielding faster time to market). Establish strong intern and graduate programs with the universities near your key sites. If you are overweight with senior engineers, ensure that your new hires are graduates or junior engineers (even if by mandate). As you compose the plan, engage you senior business leaders to ensure you have support for the changes and potential synergies with other business sites or locations. Ensure they understand you will always locate client-facing personnel with the client, but IT ‘back and middle office’ staff will be where it is best to recruit and retain IT talent.

Make sure your recruiting practices are up to snuff. You should be doing a thorough filtering of technical talent while also ensuring that you are getting someone who can work well with others and has the same key values of quality, initiative and responsibility that you are seeking. Leverage team interview or top-grading practices as appropriate to ensure you weed out those that do not interact well (especially management recruits or team leads). Invariably, management in a IT organization can improve how they handle performance management. Because most of the managers are engineers, their ability to interact firmly with another person in a highly constructive manner is typically under-developed. Provide classes and interactive session on how to do coaching and provide feedback to employees. Even better, insist that performance reviews must be read and signed off by the manager’s manager before being given to improve the quality of the reviews. This a key element to focus on because the line manager’s interaction with an employee is the largest factor in undesired attrition and employee engagement.

Even if you execute your workforce mix and your recruiting and performance management flawlessly and you do not align your goals and rewards (and incentives) you will not get the change you desire. Quite simply, your smartest team members, will observe what you reward, and if you do not reinforce the values you are looking to achieve (productivity, quality, initiative, etc), you will not get the changes desired. So, gather your senior team. Work together to revise and update the vision and goals of your organization. Ensure they are big enough goals (e.g., Not ‘ Save $40M in costs’ instead ‘ Become top quartile in quality and efficiency in IT for our industry and company size by 201x’). And then line up quarterly awards that are very public that reward those who exemplify the values and results you are looking to achieve. The organization will then align their efforts much more keenly to your vision and goals.

Now that you have the foundation in place for long term results, execute and improve every quarter. You will need to begin pruning. And as you add new and better capability to your organization through improved recruiting techniques, you can afford to prune those marginal managers that you couldn’t lose before. This will provide another round of lift for your team productivity as they are replaced with better internal candidates who have grasped the new values and effort or better filtered external talent.

In the next post on long term tactics, we will talk about the metrics and benchmarking you will use to ensure you stay on track an enable you to identify additional and continual improvements. But you are on your way now.

What areas would you change? What pitfalls do you see or have you encountered? Post a comment and let me know. I look forward to your feedback.

Best, Jim

 

Delivering Efficiency and Cost Reductions: Long term approach

    Jim D

In the last 4 posts we have covered how you should deliver IT cost reductions in the near term. And if executed well, you will also yield some longer term benefits such as a better workforce balance or elimination of redundant or low value systems. But how do you deliver material improvements in cost and efficiency that are sustainable and material? First, you must put in place long term tactics that you will relentlessly pursue. To make a material difference here, you must be both consistent and persistent in your approach.

First, you lay the groundwork for sustainable improved cost through quality. Second, you must achieve a highly productive and well-balanced team in order to meet a world class cost profile. Third, you must have in place modern, consolidated infrastructure and well-architected core systems. And then finally, by leveraging a metrics-based, transparent framework with continuous process improvement you will achieve and then sustain the world class cost edge.

Cost reduction and efficiency have become a prevalent drumbeat for almost any IT shop in the past 4 years. I think it is important to recognize that just taking short term actions to achieve efficiencies for this quarter or this year are inadequate for today’s business environment. Because your business, regardless of the industry, is becoming more and more reliant on IT to deliver the services, enable the business operations. If you fall behind here because of cost-cutting, you are now impacting the viability of the business. Most importantly though, the technology, almost without regard to industry, is becoming a larger and larger portion of the product. Thus, if you do not build up better IT capability than you impact the future of your business. So, cost cutting must be done such that you build capability while reducing costs, no mean feat.

I think it is important to recognize that in many industries, the technology approach is now changed forever due to several key factors. The impact of consumerization of technology, mobility and smart phones, the growing scope of pseudo-automated workflow and application tools, and the economic upheaval of the past 3 years have changed dramatically how technology can should be applied. I will review these industry inputs and their impacts further tomorrow.

And then later in the week, I will map out the specifics for each of the four elements of achieving a sustainable and material cost advantage in IT over the long run.