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Action Points
I. How Can IT Become “Lean”? While IT does perform a vital business function at most organizations, in many cases, its solutions can be delivered in faster and cheaper ways. Accomplishing this, however, usually requires direction from the CTO/CIO to eliminate project bureaucracy, leverage cross-organizational strengths or, even, determine that a project is not needed after all. II. The Bottom Line Some organizations have always been lean by necessity; others are now adopting such strategies to stay viable in a depressed economy amidst increased costs. The most important benchmark, however, for evaluating IT in any setting is a simple ROI equation: How much did IT spend, and how much did its solutions benefit the company? III. Must-Have Strategies for Lean Project Management Sometimes time and/or cost constraints will prevent you from performing the meticulous steps on which “good” project planning depends. In such cases, you still must apply clearly articulated management practices — except that these will focus more intently on empowering your team to figure out next steps for themselves and “make it happen.” IV. The Golden Rules for Motivating Employees to Work in “Lean” Ways If your IT team members are given ownership over their areas, and are acknowledged and compensated for their successes, they will most likely be motivated to develop efficient solutions once you convey that they are a priority. Many people, in fact, will welcome the opportunity to work lean — as long as they are not pushed to the point of burnout. V. Essential Take-Aways The parameters for how efficient your IT operations need to be will most likely be driven by the big values and goals of your company. However, as CTO/CIO, you nevertheless must decide what “lean thinking” means for your department: Use offshore vendors? Employ “crisis management” strategies? Provide the most pared-down solution?
™
in partnership with Aspatore Books
The IT VPs from SupplyCore, Wolters Kluwer Corporate Legal Services, Saint Leo University, and TheLadders.com on:
The Art of Lean Thinking: Influencing the IT Culture
Chuck Beach Vice President of Information Technologies, SupplyCore Inc. Chris Jutkiewicz Executive VP, Chief Technology Officer Wolters Kluwer Corporate Legal Services Les Lloyd Associate VP and CIO, Saint Leo University Alain Benzaken Vice President Technology and Customer Care, TheLadders.com
T
Contents
About the Authors . . . . . . . . . . . . . . . . . . . . p.2 Chuck Beach . . . . . . . . . . . . . . . . . . . . . . . . . p.3 Chris Jutkiewicz . . . . . . . . . . . . . . . . . . . . . . p.9 Les Lloyd . . . . . . . . . . . . . . . . . . . . . . . . . . . p.14 Alain Benzaken . . . . . . . . . . . . . . . . . . . . . p.16 Ideas to Build Upon & Action Points . . . p.18
oday, an IT department has many reasons for adopting “lean” practices; saving costs is only the most obvious. Other objectives are to reduce time to market, offer more competitive products and services, increase capacity, and simplify solutions. There are a myriad of ways to accomplish this: streamline project-planning practices, use opensource applications, opt for solutions that avoid bureaucratic approvals and delays, etc. Drawing on the experience of four IT vice presidents from diverse industries, this ExecBlueprint discusses “lean IT thinking” from multiple perspectives and provides guidance for how today’s CTO/CIO can create a more cost- and time-efficient operation without sacrificing quality, employee morale, or IT’s vital role in the organization. The authors claim that such a focus can, in fact, serve to improve IT’s standing with the business and employees by creating innovative opportunities to earn recognition and profits. The key to engaging the business and IT team members? Stay aligned with overall business objectives while celebrating individual and team accomplishments. ■
Copyright 2008 Books24x7®. All rights reserved. Reproduction in whole or part is prohibited without the prior written permission of the publisher. This ExecBlueprints™ document was published as part of a subscription based service. ExecBlueprints, a Referenceware® collection from Books24x7, provides concise, easy to absorb, practical information to help organizations address pressing strategic issues. For more information about ExecBlueprints, please visit www.execblueprints.com.
About the Authors
Chuck Beach
Vice President of Information Technologies, SupplyCore Inc.
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efore joining SupplyCore, Chuck Beach was employed for 20 years at the Hamilton-Sundstrand division of United Technologies Corporation. Residing in Rockford, Illinois, he teaches at Rockford College and also serves on the local board of the American Red
Cross and on the technology advisor board of Community Collaboration Incorporation, a non-profit organization working on a system that will allow social service agencies to collaborate on their clients.
Mr. Beach earned his B.S. and M.S. in Computer Science at Northern Illinois University and his M.B.A. from Rockford College.
☛ Read Chuck’s insights on Page 3
Chris Jutkiewicz
Executive VP, Chief Technology Officer, Wolters Kluwer Corporate Legal Services
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hris Jutkiewicz has a nearly threedecade background in the design and development of commercial software systems. Currently he serves as the executive VP and chief technology officer for Wolters Kluwer Corporate Legal Services (CLS), a division of Wolters Kluwer NV, the worldwide professional publishing and information services company. CLS provides intelligent software and service solutions that empower legal professionals to more effectively manage dynamic information, speed up workflows,
and make critical decisions. In his role at CLS, Mr. Jutkiewicz exercises broad management oversight across technology resources to deliver effective solutions to CLS customers. For example, he leads efforts to strengthen program management, application architecture and availability, and the development of software best practices. Prior to Wolters Kluwer, he served as a software development VP at Reuters North America, and led the development of several large-scale financial transaction
systems including GLOBEX®, the first worldwide electronic trading system for commodity futures and options. Prior to Reuters, Mr. Jutkiewicz held roles ranging from software engineer to technical manager in several companies providing commercial software solutions.
☛ Read Chris’ insights on Page 9
Les Lloyd
Associate VP and CIO, Saint Leo University
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es Lloyd currently serves as the chief information officer for Saint Leo University. Serving primarily adult students and military personnel, Saint Leo has over 40,000 students at campuses in eight states. Its main
campus, near Tampa, Florida, serves 3,000 students. Mr. Lloyd has over 30 years’ experience in industry and higher education IT. He has been in CIO positions for over 20 years, and has edited six books
on information technology in higher education.
☛ Read Les’ insights on Page 14
Alain Benzaken
Vice President Technology and Customer Care, TheLadders.com
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lain Benzaken is vice president of technology and customer care for TheLadders.com. He has extensive experience in online consumer Web site technologies, most notably in leading large web development teams and building highly scalable systems. Mr. Benzaken also oversees the company’s Customer Care team, which consists primarily of TheLadders.com customer service.
Prior to TheLadders.com, Mr. Benzaken was CTO at Ground Travel Technology Team, Inc. (GT3), where he led efforts to build a national ground transportation reservations system. From 1998 to 2002, he was an executive at Priceline.com, serving as vice president, development of international systems, where he launched e-commerce travel products in Europe and Asia. With the company from its early years through
its period of rapid growth, he was also the architect of Priceline.com’s customer systems. Previously, Mr. Benzaken spent 11 years on the Web frontier at Prodigy Services Corporation, where he was a developer of the company’s proprietary Web browser and editorial tools.
☛ Read Alain’s insights on Page 16
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About the Authors
ExecBlueprints
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Chuck Beach
Vice President of Information Technologies, SupplyCore Inc.
Introduction
Business requirements often define the culture of a company. The culture of Federal Express is governed by “absolutely, positively overnight” delivery. GE wants each division to be number-one or number-two in their industry. Suffice it to say that the culture of the company has to meet the business objectives to succeed. By extension, the IT function, which creates and supports the systems a company uses, has to have a culture that fits the business. This section is about creating an IT culture that supported SupplyCore, a technology-based company whose unique business model and exponential growth eventually landed it in the Inc. magazine “Hall of Fame” for being one of the 500 fastest-growing companies in the U.S. for five years in a row.
IT Project Management in a Rapid Growth Company
I worked in a Fortune 500 company for about 20 years and can really appreciate a well-planned, wellexecuted project. Good project planning and implementation are very methodical and predictable almost by definition, and lots of great books and resources are devoted to this subject. Every IT manager should be able to live and breathe those principles. After all, good project planning is all about good input, good process,
and good outputs — the core values behind all that is IT. Now suppose you took the concepts of “good project planning” and compressed the timeline in half…then half again. Well, something’s gotta give. A traditional project manager would say if you shorten the time, you will have to increase the costs and/or lower quality. OK, that seems like a reasonable statement. Now let’s add more constraints. You now have half the resources a traditional project of this sort would require and quality must be maintained. At this point, the traditional project manager would be saying it is impossible. And it may be true in many cases, but there is one more facet that could be changed that might allow one to succeed under those constraints: process. Contrast “traditional project management” with the process involved in handling an unanticipated IT crisis where there just isn’t enough time or information for thorough planning. Without foreknowledge, next tasks are usually determined by investigation and discovery. All we know is that an important objective needs to be addressed. In these situations, IT people are just tasked with “solving the problem” as rapidly as they can, using whatever innovation and creativity that they can muster. The role of the IT manager then becomes one of coordinator, resource mobilizer, and expeditor. And somehow it all comes together
Chuck Beach
Vice President of Information Technologies SupplyCore Inc.
“Changing a culture can be difficult. Hiring people that fit your culture is much easier.” • Previously employed at United Technologies Division • B.S.; M.S., Computer Science, Northern Illinois University • M.B.A., Rockford College Mr. Beach can be e-mailed at chuck.beach@execblueprints.com
Sometimes I have to tell our IT folks: “Move forward despite ambiguity.”
Chuck Beach Vice President of Information Technologies SupplyCore Inc.
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at the end. At such times, many will marvel at just how much can get done and how well people can work together. Of course, few rational individuals would want to work in “crisis mode” all the time, and frequent crises would probably indicate some serious fundamental flaws within the organization. Still, after a crisis, many IT managers wonder: “How can we be so good at addressing crises, and yet have so many floundering projects?” But usually at this point a good IT manager is now appropriately focusing their time on future crisis avoidance, and this question remains
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Chuck Beach
Vice President of Information Technologies, SupplyCore Inc.
(continued)
role and authority each user would have including report visible, approval thresholds, and types of products that can be requisitioned. It even included logos and links important to that base so that people there would know that this was configured just for them. As word spread to different military bases of an “enthusiastic and able” supplier that would help them with the supply-chain and systems integration issues, both the business and the challenges grew almost exponentially. The roller coaster ride was only beginning.
unanswered or becomes a mere mental exercise. Suppose you were able to fold the best elements of crisis management with the best elements of project management. Could you get good results within the incredible compressed timeline and limited resources? The answer is a qualified “Yes.” We’re not talking about simply adopting some “rapid development” principles. We’re talking about “warp-speed development” principles governed by a business need to “achieve the business goal” quickly and move on. For any C-level executive reading this, do not automatically assume that you can or should change your current project management practices. Rather, these ideas should be considered as simply more tools in the project managers’ toolbox to be used as the situation merits. Without going into a complete decision tree, the principles of “warp-speed development” should only be used where “rapid success” will have significant business benefits, while “risk of failure” is negligible or can be mitigated.
The Challenge
SupplyCore is unlike any other business I have ever encountered. It had a new and untested business model. There was no roadmap. When I joined the company, it was ready to explode in growth, reaching a rate of 4,000 percent in less than five years. Growth that rapid makes it difficult to predict and plan beyond a few months. The concept of “business as usual” does not apply. So what exactly was the business model? In short, it practically redefined the oft-used term,
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“customer-oriented.” In the booming dot-com era where Web sites were creating new and different ways to sell product and persuade shoppers to come to their sites, our CEO envisioned an almost exact opposite approach: Use technology to morph the company into how our customers wanted to do business. The model had some mild success in visionary or non-standard business segments of Boeing and Caterpillar where fantastically nimble and accommodating suppliers were needed to accomplish some unique supply-chain objectives. However, where it really took off was in our work with the U.S. military. The military has many unique and seemingly strange ways of doing things. Many suppliers prefer not to do business with the military because it can require significant changes to their standard processes and in a congressionallyfunded mandate for the military to update their systems; many suppliers were reluctant to follow up with needed changes. The SupplyCore model fit perfectly with the military, especially during this time when they were rapidly transforming their procurement systems. Our standard operating procedure and philosophy was: “Figure it out and make it happen.” The DOD and the bases communicated their change needs, and SupplyCore would make it happen — usually without committees or fanfare (just DOD and SupplyCore associates working together to solve problems). Even our Web procurement site, “Inventory in Motion,” was designed to be able to morph into how a base or command officer wanted to control local requisition. With just a few parameter changes, it would govern what
Hiring for the Culture
When I went about assembling this team, my interview questions were as much about attitude as they were about skills. Fundamentally I was looking for attitude and aptitude with good basic skills. I found that someone with a great attitude and aptitude can pick up almost any skill. But it is far harder (if not impossible) to change a sub-par attitude into a highly skilled individual. All interviews started with a promise of honesty and openness with the goal of jointly determining if this would be a good match for the both of us. That is, I wanted to provide a full disclosure of the job, warts and all, right up front. In fact, I would paint a little bit bleaker picture just to discuss and judge how this person would handle it. The point was that neither of us should have “hiring remorse” after the fact.
Company Core Values
The SupplyCore business model was very fluid. Phrases like, “We’ve always done it that way,” simply did not apply. “Standard operating
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Chuck Beach
Vice President of Information Technologies, SupplyCore Inc.
(continued)
• Have a great time. This is a high-stress job. Make sure it is the good kind of stress where you have some influence and control over resolving it. • All first-time mistakes are the fault of the VP of IT. After all, management creates the work environment. So, if you make a mistake, feel free to blame me.
procedures” were a bit of an oxymoron as they were being refined and reinvented continually. Even though we did not have history as a guide, the company did have some core fundamental values that were ingrained in our culture, re-enforced from the CEO down — and they guided every decision: • Be “customer-mission” focused – not just customer-focused. Our value-add comes from getting to know our DOD customer and their mission, and actively working to make it faster, easier, and more effective. • “Ethical in all things we do” — with customers, suppliers, and each other. There are no gray areas. “If it appears gray, stay away.” This was not just a platitude; it was an absolute. In the interview process, I made it clear that a breach would end up in termination on the first offense.
• Take ownership of problems and issues. Do not ignore or let go unless they have been successfully handed off to someone else. • Take responsibility and ownership of your area of support. Make it great. Share your success stories. Ask for help as needed.
How to Address Project Bureaucracy: Five Essential Steps
1. Provide your IT decision makers direct contact with the other decision makers. 2. Set standards on approval, decision, and questions time — for some projects, this will be less than two hours. 3. Give your IT project managers authority to take action in absence of a timely decision. 4. Choose the tools that allow the user to fully participate in the process from any laptop, home PC, or smart phone. 5. Establish structure and standards to yield a more predictable project environment where lesser-value communications can be avoided.
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IT Core Values
• “Figure it out. Make it happen” was our mantra for all associates. There were new challenges every day. It was important for every associate to know that they were not just empowered to solve problems; they were expected to take ownership and just do it. • Always be a positive part of our culture. We’re a small company. You make up a large part of the culture. Be the kind of person you want our culture to be. • Be professional in all you do. Set the standard for others.
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Chuck Beach
Vice President of Information Technologies, SupplyCore Inc.
(continued)
just dive in and figure it out. Isn’t that a bit scary? You bet! And it is not a substitute for good planning, only a choice if there are barriers and reasons to producing a good planning. It may also be the best choice if the “reward of success” in a timely matter greatly exceeds the “risk of failure” (and “doing nothing” can be considered a type of failure). Sometimes I have to tell our IT folks: “Move forward despite ambiguity.” If you’re right, you’ve made progress. If you’re wrong, at least you’re making the mistake quickly and can learn and move on.
Then work to fix the process so it doesn’t happen again. (The second time you make the same mistake, it is your fault.)
to take action in absence of a timely decision. • Enable participation from anywhere. The Internet is available everywhere. Choose the tools that allow the user to fully participate from any laptop, home PC, or smart phone. • Embrace structure; eschew bureaucracy. Structure and standards create predictability in a project environment. This reduces the need for lesser-value communications. Bureaucracy usually creeps in because of distrust or a desire to control. Leaning out the bureaucracy does require a shift in culture and attitudes by management.
Lean Culture: Bureaucracy
There can be different components to being lean. One of the most frequently overlooked and cheapest to address is project bureaucracy. It can also be one of the most important in the achievement of “warpspeed” project execution. With any given project, a lot of time is spent waiting for things. It could be waiting for input, waiting for approvals, waiting for documentation. During all this wait time, precious time is slipping by. The IT project manager’s role here is “expeditor”: Find out what people are waiting on and take care of it quickly; preferably in minutes or hours. Stingily managing “queue time” can be the cheapest method for keeping a project on schedule. Some ideas for squeezing out “queue time” are: • Keep lines of communication short. Provide your IT decision makers direct contact with the other decision makers, and even consider co-locating together for very high profile projects. • Set standards on approval, decision, and questions time. For extremely tight-scheduled projects, approvals and decisions should made by management in less than four business hours, perhaps even within two hours. In today’s world of smart cell phones and ubiquitous Wi-fi, this is more doable than ever. • Trust and delegate. Give your IT project managers authority
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Lean Culture: The Right Tools
For a technician to move quickly, they need the right tools. This includes software, hardware, fast connections, whatever it takes for the technician to hit the ground running when they are working on a project.
Lean Culture: Planning
The cardinal rule of traditional project management is not to start until the detailed plan is in place. Sometimes the bulk of a project’s time is in the planning stage, and sometimes that is appropriate. But sometimes all you know is a business goal and don’t exactly know how to get there. Consider a football team. They have a clear goal (in fact it is called just that). But they don’t know exactly how the sequence of events will unfold. Instead they take the field and figure it out one play at a time. No amount of pre-planning could predict exactly how the goal is made. Instead, the team is trained, focused, and supported to meet the objective. Sometimes IT projects are like that. You have a clear business goal but are not sure how to get there. More analysis is needed. Or you could task one of your tech folks to
Lean Culture: Scheduling
How do you make long-term project plans if you can’t even predict what’s going to happen in the short run? The answer: • Only make detailed plans as far out as you can accurately predict. If you don’t know what’s happening six-months out, draw the line there • Always have a long-term strategy. If you don’t have a framework, then all you will end up with is a bunch of unrelated projects. Every new project should be executed to support the grander design.
Chuck Beach ExecBlueprints 6
Chuck Beach
Vice President of Information Technologies, SupplyCore Inc.
(continued)
During some particularly difficult times, I set a project limit to just six weeks because that was about all we could predict. If a project was longer than that, we would prioritize the desired outcomes and reduce the project scope to deliver the highest value items within the six-week time frame. (One unexpected outcome was that frequently when someone received the most valuable part of a project, doing the rest was less important.)
Developing the “IT Dream Team” at SupplyCore
I used to work for a Fortune 500 company, where I was very happy for 20 years. When my current CEO offered me a job, I turned him down twice but was interested enough in his model to provide advice. One of the things I told him was that, due to the sheer unpredictability of where his business model might take him, he was going to need an extraordinarily special IT team. He said that if I came on board, one of the things I could do was build my own IT team. I thought about that — a lot. And when I thought about why I like to come to work in the morning, I realized it was because of the wonderful IT people with whom I was able to work. They were dynamic, driven, fun, and creative. Then, when I thought about why I sometimes didn’t like to come to work, I realized it was because of some lousy IT people who were arrogant and egotistical. I decided then that it would be really cool to build an IT dream team whose focus was to create an incredibly positive and creative culture. I knew I would need a little time to find the right people. But I was somewhat gratified when on day two of my job, one of the owners came up to me, wagged her finger, and said, “I run a family business. Don’t screw it up.” Later I found out that they had hired and fired a previous IT person who negatively affected the whole culture. She was concerned that this attitude was typical of IT people.
Lean Culture: Customer Consulting
There is one important constraint that drives our spartan-like project execution methods in helping our DOD customers transform procurement systems: we were not being paid to do it. Our contract with the DOD was for MRO supplies with rigidly capped profit margins. We could have provided full-blown consultant-type proposals, along with the requisite hefty price tags. It might have been approved in a few months and offered a tidy per-project profit. Or we did what we did: just jump in and help when asked and get it done as quickly and efficiently as possible. Giving away expensive technical services is not profitable, hence the lean culture and approach to customer consulting. Not having a lot of time or money to develop solutions forced us to innovate in unusual and creative ways. In the simplest terms, our approach to our customer consulting was: Find the easiest, simplest, fastest solution to meet the objective. In practice, this usually means:
• Allow the customer to operate their current system and processes as close to “as is” as possible. • Focus on the core functionality with few bells and whistles. • Use standard and in-house interfaces, with no outside purchases necessary. • Choose solutions that avoid bureaucratic approvals and delays. Over time, we ended up investing heavily in hardware, software, and talent in integration technology. We created reusable tools and techniques and broadened our offerings. Each new integration project became easier. Soon, we got a reputation as a no-hassle, integrated supply and logistics company. On the other side of every successful project are creative and innovative DOD tech men and women. These folks are always willing to give it their all to help find and implement a solution and appreciate a partner
that abhors needless bureaucracy as much as they do.
Motivating Employees
IT people, by nature, tend to be more motivated when they accomplish great things. The most important thing an IT manager can do is acknowledge and celebrate successes. Regular IT meetings are a great way to do that. Unfortunately, most IT folks dread the IT staff meeting as time-wasting and boring. Normally people go around the table and justify their time spent on projects. However, IT is an exciting field and the IT staff meetings should be interesting and informative. People should be able to talk about the cool things they did — whether that is something they learned or discovered, or whether they had a breakthrough. IT staff meetings should be an exciting gathering of the wizards. For the rest of the week, they are humble technicians, but when they’re in a meeting with their peers,
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Chuck Beach
Vice President of Information Technologies, SupplyCore Inc.
(continued)
much effort did IT put in and how much did it benefit the company? Any other measure is superfluous to that measure. On a closer management level, we can look at the work of IT professionals by employing the usual TQM measures: • On-time delivery (meeting deadlines) • Quality (fewer defects) • Cost Generally, if you have a suboptimal employee, their poor performance will show up in one or more of these measures. ■
they should have an opportunity to brag a little bit and celebrate their accomplishments. Finally, a good IT manager ties everything the staff does back to specific business objectives and goals. This serves as a reminder of the yardstick used to measure our activities and helps the IT team better understand how their works fits into the big picture.
Communication: Getting to the Real Needs
IT projects require a great deal of specificity but not every decision maker is a systematic thinker. The burden to bridge the gap from the abstract to the concrete falls chiefly on the IT professional. Discussion
with the decision maker should always start off with: “What business objective do you need to meet?” The decision maker may have requested a sub-par solution because that’s all they know. They may have asked for a report to look up information. Perhaps the answer is an alert to their e-mail if the event they are looking for happens. Or the answer is to send the alert directly to the person that will fix it. Even better, you should probably just fix the system so the event doesn’t have to be monitored at all.
Benchmarks
The most important benchmark for IT is a simple ROI equation: How
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Chuck Beach
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Chris Jutkiewicz
Executive VP, Chief Technology Officer, Wolters Kluwer Corporate Legal Services
My CLS managers and I have found that if our team members have challenging work on current technology platforms, if their efforts are respected and valued, and if they are compensated appropriately, they will be motivated to adopt lean best practices.
Chris Jutkiewicz Executive VP, Chief Technology Officer Wolters Kluwer Corporate Legal Services
Defining IT Culture
To me, “IT culture” as a concept has always has been fairly abstract. There are very few technology leaders I know that consciously ponder the essence and meaning of culture in their organizations. However, culture is tremendously important because it’s one of the biggest enablers for delivering value to the overall organization. In our particular Wolters Kluwer division, Corporate Legal Services (CLS), culture means things like understanding our customer base and their needs, embracing our overall company values, being business- and technology-domain knowledgeable, and living our best practices — the “what” and perhaps more importantly, the “why.” I also believe that our culture has embraced collaborative teamwork as well as individual excellence. Finally, like most organizations, IT culture is significantly influenced by the culture of executive teams, department managers, and project leads. Our senior managers have had to regularly take the pulse of the organization, and ensure that information gaps are filled, team or individual issues are addressed, and that we remain open to feedback. Our IT people are not shy
about sharing views on what’s working and what’s not. The culture at CLS has really evolved over time as we’ve expanded, taken on new challenges (e.g., systems outsourcing, software offshore development), and delivered value through the software products we’ve created and business applications that we’ve launched. Over the last seven years, IT has grown through acquisition; we now have five distinct delivery organizations in different parts of the U.S. We provide everything from ERP services for financials and customer management to Web-based “software as a service” (SaaS) solutions to shrink-wrapped software. Several of our businesses, acquired for their strategic fit, were fairly small in size but have dynamic, agile IT teams delivering software products against tight deadlines. We effected the integration of values and ideals across these teams so as to leverage the cross-organizational power “of the whole,” scaling the best technical solutions and process best practices while retaining the drive and focus that had helped build these businesses in the first place. As I mentioned, two particular areas have caused major cultural shifts for us — data center outsourcing and software development offshoring.
Chris Jutkiewicz
Executive VP, Chief Technology Officer Wolters Kluwer Corporate Legal Services
“As a member of the executive team, I am challenged to drive the IT organization to consistently create a strategic business advantage through the development of customer-facing software solutions, internal business process applications, and efficient and available systems architectures.” • Nearly 30 years’ experience in designing and developing commercial software systems • Previously software development VP, Reuters North America • B.S., Computer Science, Union College • M.B.A., Adelphi University Mr. Jutkiewicz can be e-mailed at chris.jutkiewicz@execblueprints.com
The former area, on the systems side, has involved migrating from self-managed data center(s), with all their requisite internal skills and best practices, to that of a completely outsourced model. A thirdparty partner is now responsible for systems hosting and operation while CLS is responsible for the applications that run on these systems. IT outsourcing is a pretty common occurrence, but culturally speaking, it caused a fairly seismic
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Chris Jutkiewicz
Executive VP, Chief Technology Officer, Wolters Kluwer Corporate Legal Services
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cost of ownership and how we divide the IT investment pie to achieve the most “bang for the buck.” Traditionally, our internal CLS resources were assigned to projects based upon priorities, and we used our ability to understand the somewhat nebulous “opportunity cost” of assigning them either to project A versus project B as a way of optimizing our investments. We certainly had used U.S.-based consulting resources in the past but the executive businesslevel expectation of offshore multiples required program management best practices to evolve quickly. We didn’t exactly understand that we were building “leanness” through this process, but this initial focus on the “hard dollar” offshore investment has spread to a TCO model and a very insightful, collaborative process for managing projects jointly with our business partners. Second, the best practices that you evolve in conjunction with your offshore partner(s) can make or break your aspiration to run a lean software development shop. Our organizations have moved from using offshore partners as additional project horsepower to a true development center model. In terms of ability to scale, we hit a wall about two years ago. Our overall capacity was governed by the number of technical leads, business analysts, and/or project managers in our own CLS organization. While this model gave us a “warm feeling” that we had all the necessary key domain knowledge and leadership in house, we could not keep up with demand, and it was not because of a shortage of consulting funding.
series of events for us. Many of the very dedicated, self-directed “get it done” IT operations staff members were forced to deal with huge process and responsibility changes. Significant learning curves existed in both our organization as well as in that of the hosting provider. It’s been a bumpy road, but I think our culture has developed pretty effectively to keep things on an even keel. We have also had the opportunity of sharing values and best practices with other Wolters Kluwer organizations, and WK has developed a pretty effective central organization of domain experts to help maintain consistent relationships and best practices with our partner. For the latter, software development offshoring, we initially (circa 2002) sought to leverage our investment in variable staffing (read: consultants) at better price points and to create a more consistent and scalable resource pool. Over several years we have overtly targeted an evolution of our internal CLS staff competencies, focusing on software architecture, project and project leadership, software QA management, and establishing true “centers of excellence” with our offshore partners. We spent a good amount of time and effort over this period to ensure that our internal WK staff understood both the internal and external changes, and the evolving new “value proposition.” Culturally, our teams have embraced our offshore partnerships; our model has stabilized and roles and responsibilities are now institutionalized. We challenged our CLS staff by “raising the bar,” communicating what skills and roles we would value in the future, and setting individual goals appropriately. We do have less
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internal CLS staff now than we did in 2002, but the skills of our current staff have increased tremendously, their roles are much broader and well rounded, and, in turn, their responsibilities have risen.
Best Practices for Leanness
Part of my remit as CTO is to look broadly across our software organizations and, with knowledge of our business strategies, help to “connect the dots.” I have a great senior IT management team and we are increasingly focused on creating leverage. There is a critical business need to establish a “straight line” from product concept to delivery, and we respect that need. However, if we can get the right “businessneutral” senior IT resources to participate in the envisioning process and be involved at the early stages of the technical architecture and design process, we can work together with the teams to maintain an efficient development process, but as importantly, enable crossorganizational leverage — architectures, designs, platforms, Web services, third-party application selection and implementation, etc. We are past the point of the individual businesses questioning the value proposition here (i.e., it’s understood), and we are working constantly to evolve the process. If I had to guess, I would say I personally spend between 15 and 20 percent of my time enabling these efficiencies. Let me focus again on offshoring because I think a lot of IT organizations have been evolving in this manner for some time now. I have two perspectives that may be of interest. First, offshoring has helped sharpen our overall focus on total
Chris Jutkiewicz
ExecBlueprints
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Chris Jutkiewicz
Executive VP, Chief Technology Officer, Wolters Kluwer Corporate Legal Services
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for short-term needs or migrate from one project to the next. Whether our team members are internal CLS staff or offshore partner resources, we endeavor to keep people engaged with our projects roadmap so as to prevent extended “bench time” and to maintain efficiency. The PMO, in collaboration with the business sponsors, tries to proactively align lifecycles of multiple projects on our timeline to ensure that bench time is minimized. We don’t want to pay for inactive resources, so it is important to have “the next project” aligned to utilize the resources moving off the completed project. This requires a good deal of coordination, because the necessary project envisioning must be completed before the resources can pick up the analysis, design, and development activities.
We were, consequently, driven to evolve a model that requires these key skills from our partners as well. Part of this model needed to embrace partner thought leadership and, from a management perspective, it also required investment in more enlightened and consistent offshore coordination. We do pay our partners for assuming the management roles that create the necessary collaboration and communication vital to efficient operation. These costs, which had historically been designated as “offshore management overhead” in cost-tracking models (an unfortunate description that invoked constant scrutiny by business leadership), are actually what enable efficiency and lean development. Through the definition of these roles as well as agreed, repeatable life cycle best practices, we have been able to extend our
Offshore Development Center and Software QA Center of Excellence models across multiple CLS businesses. Since we manage a pretty large portfolio of projects that are active at any point in time, we have also been concerned about managing the movement of staff between projects. There are only so many domainknowledgeable IT resources to go around, and many of our projects have pretty significant business and/or technology interdependencies. We have been aware for quite some time that staff “context switching” between projects can sabotage our overall efficiency. The emergence of project management best practices through a consolidated Program Management Office has helped manage our overall resource pool as the staff drop into and out of individual projects
What Drives a Sense of ‘Culture’ in the IT Organization?
What does “culture” do? It embraces: • Collaborative teamwork • Individual excellence
IT Culture
What influences “culture”? • Executive teams • Department managers • Project leads
What does “culture” mean? • Understanding the customer base and its needs • Embracing overall company values • Being business- and technology-domain knowledgeable • Living company best practices
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Chris Jutkiewicz
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Chris Jutkiewicz
Executive VP, Chief Technology Officer, Wolters Kluwer Corporate Legal Services
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releases. We’re no different at CLS; however, we work hard to not build overtime into our project assumptions. Extra effort “happens” on most IT projects; motivated teams will expend that effort to get the job done. We are also concerned with the motivation of our offshore teams. Although these teams are not direct CLS employees, they are critically important to our success. Our IT leaders work with the offshore partner leadership to understand the motivation models that they employ, and we communicate with and encourage our offshore teams on a daily basis, ensuring that information flows freely, and celebrating
In terms of lean best practices from a systems perspective, I need to again speak to the very real difference between self-managed shops and outsourced shops. Besides the obvious changes in roles, responsibilities, processes, communication channels — you name it — the outsourced model can disconnect the IT management team from tracking true TCO in a number of ways, and in turn hinder attempts to create efficiency.
Motivating Employees
I think there is a fairly strong connection between motivating IT staff to help drive leanness and
motivating IT staff in general. There are things that IT leaders need to articulate regarding lean best practices, but if teams are motivated, and that motivation is directed and encouraged by leadership, we’ve found no disconnect. Regarding overall motivation, my CLS managers and I have found that if our team members have challenging work on current technology platforms, if their efforts are respected and valued, and if they are compensated appropriately, they will be motivated. I’m sure most IT leaders can speak volumes about the “above and beyond” efforts to achieve significant product or systems
Our Wolters Kluwer North American parent drove a massive data center consolidation program over the course of two years; four of our key data centers participated in this consolidation. We needed to evolve from traditionally tracking capital and operating costs (systems, software licensing, IT staff, etc.) to a pure operating model where we are charged essentially “a la carte” for each system, and our TCO is really the overall allocation for hundreds of servers, terabytes of storage, etc. At the outset of the relationship it was very difficult to understand the true TCO at a granular level, and to recombine these costs into product and service cost profiles. This initially was caused primarily by the complexity of the contractual cost model, and was exacerbated by our own lack of best practices in dealing with and deciphering the costs as they were being allocated by central WK finance. We knew how to manage our internal capital and operating costs, but this model required new roles and tracking tools. We also somewhat naively began the relationship without a CLS senior manager in the role of IT Operations “liaison” and expert on all the elements of the partnership; this VP-level role is now fully developed and is critical to our day-to-day success.
Chris Jutkiewicz Executive VP, Chief Technology Officer Wolters Kluwer Corporate Legal Services
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Chris Jutkiewicz
ExecBlueprints
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Chris Jutkiewicz
Executive VP, Chief Technology Officer, Wolters Kluwer Corporate Legal Services
(continued)
Moreover, CLS as a business is certainly not immune to the rise and fall of the economic tide. As such, we are always looking to develop new efficiencies. Our business leadership is concerned with enabling and refining any processes that will deliver value to the customer rapidly without sacrificing quality. IT has therefore been challenged to demonstrate continuous improvement on any number of fronts — many of which can be broadly characterized as enabling leanness. We have several teams that are increasing the use of agile methodologies (including SCRUM) to evolve product ideas more quickly, enable test-driven development, and create high functioning teams with domain knowledge that can be leveraged across organizations. We are also refining our best practices to enable quicker transition of projects from QA to launch and then production support, which in turn lowers project total cost and delivers available staff into new project streams. Finally, we are also completely reviewing our overall program management best practices to identify opportunities to tighten up budget management, TCO, and return on investment calculations. ■
project successes jointly (albeit often on a video conference rather than face-to face). Specifically motivating staff to understand and act in “lean ways” has required a bit of evolution. Software developers by nature are problem solvers, and we have been lucky enough (and hopefully this is by design) to have a lot of bright people with a lot of great ideas on how solutions can be implemented. From a software development perspective, we foster lean thinking through discussions around reusable solutions (designs, user interface patterns, Web services, components, etc.). Our CLS IT management team realizes that we constantly need to promote this discussion, which identifies similar solutions and similar ways of solving problems. We are implementing ways of enabling efficient communication on this front through various means — including most recently the envisioning of a robust knowledge portal for the CLS (and overall Wolters Kluwer) IT community. As you might expect, lean thinking has not been the sole purview of IT. There are many areas of our business that have embodied lean best practices. Our CT corporation national service organization has utilized Six Sigma efficiencies to
deliver real customer benefits for several years. The IT team has enabled these efficiencies through workflow enhancements to our ERP system and an extensive upgrade to our business reporting platform. Our product development business teams are now leveraging Web platform solutions (foundation architectures, look-and-feel, UI frameworks, common workflows, etc.) between products. Our product “interconnectedness” will continue to increase, and we are excited that this has translated into a critical evaluation of product design reuse.
Upcoming Changes
From a CLS perspective, we are strongly motivated by our Wolters Kluwer parent to explore information technology TCO across all WK businesses, and to look for ways to leverage that investment consistently. Senior executive management is working with all WK CTOs to create the broad level of discourse necessary to expose these opportunities. Wolters Kluwer already has major investments in data center consolidation, and outsourcing, offshoring (both BPO and software development) and we are in the midst of several other strategic initiatives.
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Chris Jutkiewicz
ExecBlueprints
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Les Lloyd
Associate VP and CIO, Saint Leo University
IT as a Service Industry
For us as an IT department, it is important that we are synonymous with the word “service.” We have to remember that everything we do is to benefit clients, whether they are students, faculty, staff, alumni, or members of the community. There are a lot of ways we can assess ourselves and ensure that this focus on service is carried through: • We observe our staff at every level and how they work with people • We solicit input • We do surveys • We look at the best practices of other institutions
Leanness and Efficiency
I think that we are lean by design; that is just the way our organization is. Saint Leo is a Catholic institution with very strong values, and part of those values involves a responsible sense of stewardship. We are therefore very careful about how many positions we request and what hardware we buy. Because IT must remain aligned with the mission of the institution, any requests must address the organization’s strategic initiatives.
When we compare ourselves to other organizations we find that we are pretty lean — or efficient, which I think is a more accurate description — and that goes back again to the institution’s value placed on responsible stewardship. There is a significant number of people, myself included, who review essentially every purchase and design with an eye toward ensuring that we are being efficient, not only in controlling cost or size, but in doing the best that we can. The degree to which an organization is efficient or lean depends, I think, on the financial situation of that organization and its management. There are places that have so much money that you do not have to think about these qualities quite so much, and there are places with so little money that they are all that you think about.
Les Lloyd
Associate VP and CIO Saint Leo University
“Providing service and thinking about the customer is inherent in everything that we do.” • Saint Leo University: over 40,000 students in eight campuses • Over 30 years’ experience in industry and higher education IT • Edited six books on information technology in higher education Mr. Lloyd can be e-mailed at les.lloyd@execblueprints.com
department,” “hardware department,” etc.) to one that affirms that we are all one department. There never should be an occasion when somebody says, “I don’t do that — that is their job.”
Grassroots Vs. Policy: The Role of the CIO
I try to let things happen without invoking “policy,” i.e., I try to encourage my department to work on grassroots ideas and let that attitude trickle out and become part of the culture. However, if that does not work, then of course it is time to think about instituting policies. Moreover, for certain issues, the community holds service-level expectations. We are working on such a project right now that concerns the reuse of consumables and equipment. That will end up as a policy. If we are a department with one mission, each of us should be able to provide the same answer to any question. As new policies or paradigms are created, people should still be able to expect consistent responses. To do that, we need to foster excellent communication between the management team and
Les Lloyd ExecBlueprints 14
Abolishing Departments Within Departments
Each of my department managers runs a smaller group, and the culture in each group influences the department. We are actually in the middle of transforming the perception that these smaller groups are their own departments (e.g., the “server department,” “networking
Culture Change
Our IT department is undergoing a big culture change right now because the associate CIO and I are both new. Consequently, I expect that for a couple of years we will be involved in supporting a cultural transition. I think that is how culture changes: when people change or when there is a new paradigm involved, a new change cycle is initiated that lasts for a few years. Right now, not only is our department experiencing new leadership, but our virtualization efforts represent one of those paradigms that influence a lot of other things as well. Other changes in the organization — for instance, in presidents and certain vice presidents, or a market realignment that significantly affects our student population — will also provoke a culture change.
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Les Lloyd
Associate VP and CIO, Saint Leo University
(continued)
the rest of the staff. Thinking about the department as one body, rather than a group of sub-departments, helps in that effort.
How Does IT Demonstrate a Commitment to Service?
Observing staff when they work with people Soliciting input Conducting surveys Researching best practices of other institutions
IT culture needs to evolve in such a way that increasing leanness is not considered a bad thing, but rather is a part of regular operations.
Les Lloyd Associate VP and CIO, Saint Leo University
Motivating and Rewarding Employees
I think that my employees see that my dedication to leanness and efficiency informs every decision I make, and I think that they also know how important these qualities are for the department. They try to bring efficiency solutions forward, and if they do not, they are asked to. If someone brings something forward that does not look lean, we will ask that person to go back and try another method. Employees are rewarded as part of the job review process, and while we do not have a separate incentive package for cost savings or implementing green initiatives or anything like that, any rewards for showing initiative in these areas definitely happen at review time. When considering which employees showed the best job performance and initiative in our department in a given year, we also look at commitment to innovation, which includes developing new efficiencies and services.
The Importance of Communication
On issues of increasing and improving IT efficiency, it is important to communicate clearly. Otherwise, it will look as though something is wrong and you are trying to cut costs as a reactive measure. IT culture needs to evolve in such a way
that increasing leanness is not considered a bad thing, but rather as a part of regular operations. We need to get it across that we are not focusing on leanness because somebody is cutting our budget, but that we are looking to do things in the most efficient means possible and still provide the best services. Communication and leanness have to go together, because as soon as people hear that you are cutting something, they will start to worry about what is wrong. One way you can make this clear is by explaining to people, “Look,
here is what we are doing, here is what the savings will be, and here is what we are going to do with those savings.” For example, we changed our practices on equipment purchasing, and while that means that we are going to have to spend a little more for about three years, after that, we are going to save probably 10 to 20 percent of our equipment costs. If you can show people upfront costs and then the long-term savings, they will not be so apt to view this change or reduction as being a bad thing. ■
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Les Lloyd
ExecBlueprints
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Alain Benzaken
Vice President Technology and Customer Care, TheLadders.com
It is important to sit with the business owners and ask why we’re building something and what it is going to get us.
Alain Benzaken Vice President Technology and Customer Care TheLadders.com
Our IT Culture
I focus on getting the IT team to understand that their contributions play a key part in the solutions that are created for the business. They are the ones who actually make things happen, and they need to know that their efforts will be recognized. Many IT people still have a complex that no one is going to listen to them, so it takes some effort. We’ve gone from a startup to a fast-growing business. In startup mode, we worked around the clock. When you’re in starter mode, you’re really in survival mode. However, you can’t be in survival mode for three years. People will burn out. We had a few episodes where people needed down time. To this day, we’ll have projects where people will work around the clock and on weekends, but we recognize that afterwards, people do need some time off. It is very important to celebrate success. We try to celebrate IT often here, with individual awards, team events, and call-outs in our companywide events for excellent accomplishments.
success becomes more assured, I will be more aggressive in hiring ahead of need — it’s part of the transition out of survival mode. I doubled the team size last year, and I’m probably going to come close to doubling again this year. We’re very careful. The business owners have to pay for the developers, so they won’t hire unless it affects their bottom line. The team concept forces the business owners to think hard about their hiring decisions.
Alain Benzaken
Vice President Technology and Customer Care TheLadders.com
“I’ve been preaching openness with the department from the day I joined. Hopefully that seeps into the rest of the team.” • Oversees company’s Customer Care team • Extensive experience in online consumer Web site technologies • Previously CTO, Ground Travel Technology Team, Inc. • B.A., Physics, Columbia College • M.S., Physics, Yale University Mr. Benzaken can be e-mailed at alain.benzaken@execblueprints.com
Cost Savings
On the hardware and software side, “lean” means saving cost. We’re very big on open-source technology; using it has resulted in huge savings for us. We use MySQL, which has led to huge savings. If I had to use Oracle, it would have cost hundreds of thousands of dollars. Virtualization is probably going to save us money as well. We’re not that big yet, so if I spent $100,000 on a piece of equipment, it would affect the bottom line. I’m well aware of budgets and how much we have to spend. One of our quarterly goals is not going over on capital expenditures and computing expenses. We were spending X amount per employee per month last year, and when we looked at the budget, we thought we could cut back. The businesses were ordering whatever they wanted because they liked having
the latest toys. Now we have a budget limit and we charge things back to the businesses, so they have to pay for those toys. That practice forces them to be lean.
Motivating Employees
We address any negative or inappropriate behavior immediately. I do one-on-ones with my direct reports every week, and everybody else does the same with their direct reports. If the business owner sees something happening, we address it. We have started grading people on a curve. The people on the bottom
Alain Benzaken ExecBlueprints 16
Lean Thinking
We’re lean by nature. I tend not to hire too fast because I was burned during the dot-com boom, and it is important for teams to mesh together. However, I will hire when the need is there. As our
© Books24x7, 2008
Alain Benzaken
Vice President Technology and Customer Care, TheLadders.com
(continued)
of the curve know who they are. They’re expected to perform or they will be asked to leave. Having a lean IT culture motivates employees to make efficient use of their time. It’s demoralizing when companies aren’t lean; the good people wonder why money is being wasted. However, there’s lean and then there’s mean. If you’re too lean and everyone is working too hard, people will burn out. Employees get more of a sense of accomplishment when you’re lean, because they participate in a small team and they know that they were part of its success.
Conservation Efforts
Virtualization will allow us to spend less money on power, the cost of which has risen in the past three years to the extent that it is now more than the actual server itself. Consequently, we need to think about what service we’re buying so that we can get the most energy-efficient one. The data centers, which were built during the dot-com boom, were made for much less efficient machines, so today many data centers can’t handle any more machines. We had a situation where we had plenty of space at a data center, but we couldn’t plug anything else in because there was no more power. By force, then, we’ve had to move to virtualization, which uses less machines and less power.
5 Key Steps for Motivating the IT Staff to Work ‘Lean’
1. Celebrate individual and team accomplishments.
Improving Efficiency
Our business owners give us grades every quarter. One grade is partnership and the other is delivery. Are we delivering what we said we were going to deliver? Is it coming in on time? Are we a good partner to the business? Are we providing solutions and being proactive? The owners give us a grade which translates into a bonus. I spend a lot of time improving IT efficiency on the front end, which means ensuring that you build the right things. There are always more projects to build than resources. You can spend a lot of resources and time on projects before you realize that they’re not helping your bottom line. That’s why it is important to sit with the business owners and ask why we’re building something and what it is going to get us. Is it going to get us revenue or more margin?
2. Give time off after overtime and weekend work.
3. Provide one-on-one feedback every week.
4. Grade every member’s performance on a curve.
5. Address any negative or inappropriate behavior immediately.
Getting the business owners to commit to predicting what each of their projects is going to deliver helps us identify which ones we’re going to do. Some projects don’t make the cut, even though they might be someone’s pet project.
If we go through the process up front, we won’t waste money, time, or resources on projects that are useless. Once we pick a project, we have to get everybody on the same page and make sure people are committed to the actual work. ■
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Alain Benzaken
ExecBlueprints
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Ideas to Build Upon & Action Points
I. How Can IT Become “Lean”?
Technology departments and cultures can demonstrate leanness — or efficiency — in many ways: they can spend as little money as possible, they can finish projects quickly, they can reduce energy consumption, or they can ensure that they aren’t providing a more complex solution than the organization needs. Specific strategies that have effectively served to instill “lean thinking” at the authors’ companies are: • Eliminating “project bureaucracy” where extra steps are created during the project planning process either due to lack of trust or desire for control Implementing outsourced or offshore solutions for operations that are performed too expensively, inconsistently, and/or inefficiently inhouse Utilizing agile methodologies (including SCRUM) to evolve product ideas more quickly Integrating values and ideals across IT teams to leverage cross-organizational power and enable project scaling Communicating frequently with the business heads to ensure that all hardware and software purchases address the organization’s strategic initiatives and will positively impact the bottom line
III. Must-Have Strategies for Lean Project Management
Solid project planning is not necessarily lean project planning. Often, the process can involve the methodical formation of steps and controls that require large budgets and many people and that evolve over months, or even years. On the other hand, projects that are planned to be lean from the outset often skip a few stages along the way, and are completed more quickly and cheaply. However, even these projects need to employ proven project management techniques where the IT manager serves as coordinator, resource mobilizer, and expeditor. These can involve: • Giving IT decision makers direct contact with other decision makers Enabling people to participate in project development from remote locations Setting detailed project timelines only as far out as can be predicted Substituting planning steps with investigative and discovery methods that focus on the need to attain a specific objective Keeping a project on schedule by reducing the time spent waiting on things such as input, approvals, or documentation that can delay the project Empowering people to take action in the absence of timely decisions Creating policies and practices — but only as absolutely necessary to maintain consistency across functions Embracing structure and standards to create predictability, thereby reducing the need for lesser-value communications Minimizing the “bench time” of IT team members by aligning projects and schedules with their skill sets and availability Developing an overarching long-term strategy that provides the requisite structure and rationale for individual projects
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Minimizing work-related stress by giving them as much influence and control as possible over their tasks Not building overtime assumptions into project timelines, and allowing people who have worked overtime to take compensatory time off Holding regular meetings where people can share the “cool” things that they did Conveying that lean practices are part of regular operations — and not in response to obligatory (and potentially worrisome) cost-cutting measures Respecting and valuing peoples’ efforts Addressing issues related to problem behaviors or poor performance immediately in one-on-one discussions Compensating them appropriately Providing incentives and rewards through the performance review process Celebrating peoples’ successes and completion of milestones with awards and team events
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V. Essential Take-Aways
Usually, it’s the company’s business requirements that will define your department’s culture, and your responsibility as CTO/CIO is to “connect the dots” between your technology capabilities and the overall needs of the business. Is IT delivering what you said it would deliver? Are projects coming in on time? Is IT being proactive in the development of solutions? Is IT being a good business partner? When the business need is to work as efficiently as possible — to be as “lean” as possible — you can specifically drive that outcome by: • Introducing IT expertise into projects’ early planning phases Aiming for the easiest, simplest, and fastest solutions to meet a given objective Assessing when to apply the principles of “warpspeed development” (when the risk of failure is minimal or can be mitigated) Incorporating the best elements of crisis management into your project planning designs when the precise steps for attaining a given goal are not yet known Determining the role that outsourced resources should play in meeting heightened operational demands Supporting other departments’ lean initiatives through the development of workflow enhancements (e.g., in ERP systems and business reporting platforms) ■
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II. The Bottom Line
When business leaders hear the adjective, “lean,” in the context of IT operations, they usually think it refers to cost-saving strategies. In many cases, of course, it is business leaders’ demands to reduce IT budgets or leverage the company’s IT investment across multiple function areas that produces the impetus for lean thinking among a company’s IT professionals. But does the adoption of lean strategies actually save any money? Practices that did save money for the authors’ companies discussed in this report include: • Employing technologies such as open-source applications, virtualization, and energy-efficient equipment to save licensing fees, space, and power costs Adopting budgeting practices that charge technology costs back to the user departments Determining what the customer will pay for and scaling projects accordingly Reducing head count by outsourcing and/or offshoring certain functions Evaluating the performance — and, hence, value — of each IT team member by analyzing his/her capacity to meet deadlines, produce quality work, and stay within budget Developing total cost of ownership models for both self-managed and outsourced operations (that are often initiated by the need to assess the value versus cost of IT operations in the latter environments)
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IV. The Golden Rules for Motivating Employees to Work in “Lean” Ways
Because IT people, by nature, tend to become more motivated if they are allowed to accomplish great things, the strategies for generating enthusiasm for working in lean ways may not differ substantially from how you would normally motivate your IT teams, except that you may build lean expectations (such as reusable solutions) into project specifications. Either way, proven methods for cultivating a workforce that will productively engage in lean thinking and practices are: • Fostering a sense that all IT employees belong to one team Encouraging them to take responsibility and ownership for their areas, and for problems and issues that will emerge
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Ideas to Build Upon & Action Points
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Ideas to Build Upon & Action Points
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10 KEY QUESTIONS AND D ISCUSSION POINTS
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What does “IT culture” mean for your department and company? For your industry? How often does your company generally undergo culture changes? What factors most directly influence these trends? In what ways has your department’s culture recently changed? How have these changes resulted in a more lean-oriented culture? What factors were most influential in bringing about this culture change? What types of culture changes are most preferred by your C-level executives? In what ways do their actions, behaviors, and communication styles influence the culture in IT? What are your best practices for fostering a lean culture in IT? In what ways are they similar to your industry’s best practices? In what ways are they different? How effective have these practices been in effecting desired culture changes? What role do your department’s managers play in influencing IT culture? How do they support your efforts to create a lean-oriented culture? How do you plan to motivate your employees to support shifts toward a more lean culture? How will employees specifically benefit from these changes? How will you communicate these benefits? What are the five most essential characteristics of a lean culture in IT? To what extent is your department’s culture already lean-oriented? What percentage of your time have you devoted to improving IT efficiency in the past two years? How do you plan to measure the ROI for fostering a more lean-oriented IT culture? How can the effect of improved employee productivity on the bottom line be measured? What other benchmarks do you use to assess the effectiveness of your strategies to create a lean-oriented IT culture?
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Ideas to Build Upon & Action Points
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