Getting Time on Your Side
- 03 July, 2008 14:27
Part 5 of CXO Priorities | AGILITY
CEO optimism isn't perhaps quite as widespread as it was back in late 2006 and early 2007 when Gartner's report "Creating Enterprise Leverage: The 2007 CIO Agenda" showed two out of three enterprises wanted to grow faster than the market that year. Nonetheless competitiveness remains a key goal for company heads. In this year's report "Making the Difference: The 2008 CIO Agenda", improving business processes was the number one business priority for the fourth consecutive year, while creating new products or services (innovation) moved from 10 in 2007 to three in 2008.
If CIOs indeed intend to "make a difference" regarding competitiveness, they'll have to get extremely creative in building customer intimacy and just as clever with product design.
"It means that in your competitive marketplace you just have to run faster than the next guy, so there is a lot of pressure on introducing new products and new product features," says Gartner EXP research director Andy Rowsell-Jones. "That requires levels of integration, levels of agility which have been hitherto absent in large firms."
Making the IT operations group more client-focused, and including development as a client, can make a big difference
In the relatively small numbers of companies making widgets, time to market is all about how long it takes to design and manufacture the widget, and clearly IT used properly can accelerate that process, Rowsell-Jones says. In the rest, time to market is about prompt delivery of IT-related or highly informational products like a new insurance product, a new type of bank account or a new piece of software. Those sorts of products can present major challenges for CIOs, and the best way to speed up development is to build systems for agility, whether that means virtualizing the server farm to improve capacity or strongly defining and ruthlessly reinforcing standards.
A large institution with billions of dollars tied up in infrastructure is like a super tanker - it's not going to change direction easily whatever you do, so making such organizations "fleet of foot" above all means overcoming complexity. The ideal aim is to have the lowest possible variety of technologies that are rigorously defined in terms of standards, which allows you to be agile, Rowsell-Jones says. It's just that achieving that ideal can be extremely challenging and makes for an interesting judgement call for most CIOs.
"It's that you have to be dogmatically and unreasonably structured in your approach to new products because if you're not, it takes you too long to implement them. But in that dogmatic approach you may of course run into problems because you may be seen as unyielding and inflexible. I think that is the management challenge for most people involved in new product development.
"And it's tough making business cases. It's extraordinarily difficult to make a business case to increase the agility of the IS organization, because agility is so difficult to value - you just know when you don't have it."
Speeding Things Up
Time to market implies a product-centric view that brings ICT services to bear just when the organization's business units need them to improve their competitive position by becoming first or at least early adopters.
Aligning IT as a key enabler for changing business - for example, by facilitating accelerated decision making through extended mobile offerings - is one key to improving time to market, says Sony Abraham, a manager with Capgemini in the US. CIOs can also drive efficiencies through IT consolidation, by achieving common architecture standards and through reusable enterprise services, and by eliminating redundant processes. And they can promote innovation through collaboration; for instance by harnessing the power of social networking to bring ideas together.
The CIO's primary role should be one of enabling the business through systems and process efficiencies, notes Carl Tidwell, CIO at American Type Culture Collection (ATCC), a private, not-for-profit biological resource centre. The CIO must be a significant and trusted business partner able to assist with identifying and removing bad processes. He or she must help the business overcome the notion that it is unique, and help business leaders understand that other companies have very similar processes and business objectives. This in turn will help the BUs adopt known best practices.
"To get there CIOs must break down the technological mysticism walls they create around technology and deal with the realities of business, understand that technology is not always the solution, and apply their natural analytic thought processes to solving business problems," Tidwell says.
"If CIOs took the time to study the holistic medicines approach to treating patients, and understood what that means in the context of a business, where the BU customers are the patients, and the CIO is the medical treatment team leader, they could work with the 'patient' to identify the best treatment options that match the patient's expectations for quality of life," he says
Alan Perkins, CEO at Sydney-based Profound Information, fully concurs, saying building high levels of trust is vital. If the systems the CIO presides over are trustworthy, and the information provided is trusted, the organization will be more likely to take risks in going to market, Perkins says. "Reliable information provision (based on reliable source information, reliable systems etc) leads to confident decisions. So decisions to proceed or not to proceed will be made without room for vacillation."
There are typically two areas where organizations incur significant project delays. The first, says Edward Weller, a CMMI high maturity lead appraiser and software project management consultant from Arizona, is project start-up, where it sometimes takes too long to agree on requirements and release content. Speeding up time to market in this area means encouraging team development and resolution of requirements - there are no rewards for leaving requirements ambiguous in the hopes that leaving clarification until later will let you slip the latest new feature in. It also demands change control so the real impact of late change is understood, and recognition that demanding twice the functionality in half the time never works
The other major cause of delays happens when numerous defects are allowed to remain in the product as it goes into test from development. The most effective method of improving a project's time to market here is inspections, Weller says. "I've seen 'system' test cycles cut to 25 percent of pre-inspection values," he says.
"Most companies spend 50 to 75 per cent of their budget on rework: post ship defect repair and test rework costs. Unfortunately, we pay a lot more attention to manufacturing scrap than intellectual effort that is scrapped."
"Proper planning for testing, and set-up of packaged tests can do a lot for speeding up the testing phases," Weller says. "When tests are planned, more emphasis is placed on developing the right code the first time.
Marc Lachance, a specialist in eliminating barriers to effective ROI and IT president at M E Lachance & Associates, says the IT operations group, which provides all the facilities to the developers, is another source of delays. This group's typical focus is day-to-day operations, with new initiatives an afterthought. The technical support resources, infrastructure readiness and test facilities are often sources of major delays. Making the IT operations group more client-focused, and including development as a client, can make a big difference, he says.
And he agrees with Weller that proper planning for testing, and the setting up of packaged tests, can help put product development into hyper drive.
And then there is implementation. "I have often seen development initiatives that plan for implementation at the end. If implementation is well planned, it may change some of the requirements, which will help to speed up implementation," Lachance says.
Many legacy systems have long change cycles that increase the time to market. What a CIO can do is to try and take IT changes out of the critical path for business changes requiring agility.
CIO-at-large Hemant Kogekar says in one organization he worked for product codes and characteristics were hard coded in the programs, so change cycles ran over about nine months. "We convinced the business to invest three to four months of effort to remove the hard codes and create a flexible model for products. This cut down the cycle time from nine months to less than three months," Kogekar says.
Then there was the insurance company where pricing changes used to take several months of testing and rule changes inside legacy systems. Developing a pricing engine with easy to modify rules and connecting that with the legacy systems eliminated the need for most systems changes in the pricing, cutting the time to days or hours. All the business had to do was ensure that the rule changes were well considered.
"I have more examples where good use of tools created flexibility at critical bottlenecks which dramatically improved time to market. Of course good design and architecture are important. But that does not always mean re-engineering the whole system or business process," Kogekar says.
Meanwhile NineMSN COO Nick Spooner says it's natural for a CIO to be eager to deliver a full solution that may take longer than the business wants to accept, but a good CIO knows when to compromise. Spooner says time to market has been a key differentiator at both NineMSN and in other organizations where he's worked in the past, so he's had plenty of time to learn that finding the balance between that desire and organizational needs means working closely with fellow CXOs to learn the different levers of the business.
"If you've got a sales team or a product team that needs to deliver in a certain period of time, but the solution is going to take twice as long, working with the CXOs helps you find something that meets all of the expectations," Spooner says.
"While it's always great to be able to deliver a hundred percent, there are times when there is also a need to look at what is fit for purpose that meets the expectations in terms of getting it out to market. And I don't think you can do that in isolation; it's particularly important to draw in your colleagues, it's particularly important to understand what it is that they need.
"The thing you're looking for is, in true program management style, the trade-off between scope versus delivery and time frames and you've got to find a balance between the two."