Insulation Challenge of Transformation

With the digital disruption of business models and whole industries, business executives and process owners are faced with a variety of transformation challenges. The need and pressure to deliver and demonstrate improved performance metrics, transparency and collaboration are greater than ever.

In this environment, the importance of management frameworks which can be extended and integrated across business processes and projects cannot be overstated. The Kanban method offers a good option, but frequently gets limited to specific project teams or departmental services. Often for good reason.

A typical environment has various teams working with their different tools and solutions, failing to provide a global perspective of their place in the overall system.  In such cases, driving organization-wide transformation can be achieved only through meaningful integration of these disparate systems, allowing stakeholders at higher portfolio levels to get improved visibility of the “big picture”.

In this series of posts, we examine:

  • The need for an integrated management framework as an essential for mile-stoning and managing transformation.
  • The merits of a Kanban visual integration layer, and necessary product features to deliver on this integration.
  • The difficulties and potential pitfalls of integration, and possible mitigations and examples.
  • A transformation approach using an enterprise services view, using meaningful visual cues and meaningful analytics.

The Big Bottleneck

In most real-world scenarios that we engage with, the bottlenecks can be distilled down to two areas, neither of which are caused by oversight, but largely as a consequence of natural progression.

Every function, process or project uses its own tools, for recording, tracking, reporting and/or managing their work. Some of these are point solutions, while others could span functions and processes. A natural outcome from an enterprise view is that the data relating to work actions relevant to driving enterprise performance and transformations now lives in several insulated silos.

It becomes difficult, if not impossible, to gain a meaningful higher-level view of health and status. While individual parts seem optimized, the system they constitute is not. Not an entirely alien circumstance, you would say.

In most cases, this is a logical outcome of team or project-level investments in processes and tools – and so is almost unavoidable in many respects.

A direct corollary of this phenomenon is that the strategic decision framework gets limited by the siloed views of management data that these disparate tools can produce.

Mangers are forced to manage what they can measure, even if these are not the things that matter to the enterprise, to transform and to compete in an ever-globalizing market. This leads to a sub-optimal enterprise that is unable to deliver at the speed and capacity that it needs to in order to beat competition.

Portfolio Kanban

We recognise that Kanban delivers on visibility and transparency, providing easy to interpret early cues and signals, helping managers optimize workflow, reduce cycle times and “time to value”. Its basic principles enable it to be applied at any level of an organization’s workflow – strategic initiatives, portfolios, programs, projects and processes. A big strength of Kanban is that it can be applied at any level of the organization, making it truly powerful in this regard.

Kanban also encourages a Systems Thinking approach, strengthening the ability of the organizations to pursue global system-wide optimization, as opposed to a few local optimizations. Consider the view that in an enterprise every key process is a service, which integrates with other enterprise services within or outside its own function, with the common goal to deliver products and services to its customers, in an optimized and profitable manner.

When services are aggregated at higher levels – as a Portfolio Kanban or an Enterprise Kanban, with meaningful integrations of team-level work management tools (which maybe a Kanban Board or a JIRA instance) – they provide a potent management tool for driving enterprise transformation initiatives.

Portfolio BreakdownThe term “Portfolio Kanban” is often used to describe the process of managing portfolios of projects and business services using a hierarchy of Kanban boards, to track services at different levels with ease. The hierarchical Kanban boards, each with their appropriate stakeholders, help to visually track status, with easy cues and early signals, providing the relevant level of detail in near real time.

Portfolio Kanban is the solution with potential to elegantly eliminate the big bottleneck, helping transform the enterprise to a globally-optimized services delivery capability.

Way Forward

The need for an integrated management framework, which supports transformation taking a system-wide view, is undisputed.

Multilevel Portfolio ManagementThere is a way forward and we have been investing in it, working closely with some of the largest enterprises in the world. In the next blogpost in the series, we will examine what it takes to build a fit-for-purpose Portfolio Kanban, to gain a comprehensive view – without re-inventing or replacing existing tools and solutions.

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The Identity Crisis of Enterprise Architecture – Top Three Misconceptions

Enterprise Architecture (EA) starts out being misunderstood, like an adolescent suffering an identity crisis.

In the last article, we discussed what EA is, and how organizations can it as an effective tool to create a blueprint for a business aligned IT infrastructure. But does it get used effectively or not, very much depends how well it is understood. Today, we make an attempt to dispel the three most popular misconceptions about Enterprise Architecture (EA).

EA is going through an identity crisis, was eloquently debated by a panel of Open Group experts in this recent podcast, and how it gets often confused with Enterprise Transformation. Mark Blowers of Ovum wrote a few days ago that Enterprise architecture remains an IT-centric approach. And that is not helping.

Jumping right to it then, let me describe what Enterprise Architecture is not, by listing the top three misconceptions holding back enterprises from using this discipline to architect effectively for their ever-changing needs.

1. Enterprise Architecture is neither a “point” solution architecture nor a departmental architecture

Traditionally, the impetus for developing IT systems in an organization comes from business needs within a particular department. Apart from the plausible exception of ERP systems, the concept of systems that were common across the enterprise did not exist. In the late 90s, with the advent of websites, the intranet and the extranet, middleware platforms were employed to carry out Enterprise Application Integration (EAI). In fact, as mentioned in my previous article, EA becomes a necessity the moment two or more systems start exchanging data in a real-time manner. As business grows, so does the number of systems serving it. In order to manage this complex labyrinth of systems, an EA exercise becomes almost mandatory for the effective alignment of IT with business drivers and goals.

2. Enterprise Architecture deals with the IT alone

If aligning IT with business is the name of the game, then it is imperative that there is an equal participation from the business units i.e. other functions, both customer-facing as well as support. The early part of the EA process primarily involves workshops and one-on-one interviews with the business users of IT. These inputs are crucial for creating an appropriate EA vision for the enterprise. In other words, the executive sponsor for the EA exercise should be the entire executive and senior management team and not merely the CIO.

3. Enterprise Architecture is for large and mature organizations only

An evolved mature business organization typically comes with baggage of traditional legacy systems. The IT landscape in such an organization consists of systems with disparate technologies, at various stages in their life-cycle. This often is can be traced to vendor dependence and/or decentralized IT procurement. Such a landscape necessitates a corrective EA exercise, to make amends by defining the direction. On the other hand, a nascent organization with relatively few systems benefits from a proactive EA exercise to avoid the heterogeneous, complex and expensive IT landscape, of its mature counterparts. Needless to say, the cost, time and the resources required for an EA exercise are directly proportional to the size of the organization. All in all, an EA exercise is beneficial and recommended whether an organization is young or mature, big or small. In this instance, size does not matter!

Dr. Jeanne Ross, Director at MIT Sloan for the Center for Information Systems Research, discusses the impact of Enterprise Architecture on creating competitive advantage, especially in the new world of collaboration, analytics and mobility, that all depend upon digitized platforms. She argues that EA forces a re-think of business strategy, in her presentation about Gaining Competitive Advantage from Enterprise Architecture

In the next article, we will compare and contrast different Enterprise Architecture methodologies, and discuss their suitability for differing situations.

Contributor: Dr. Hemant Adarkar

The Monday Morning Challenge of Smart IT

Without exception all industry sectors and corporations are seeking the means to achieve Smart IT. One which delivers effectively, within budget, continues to be relevant, impacts business outcomes positively and provides a competitive edge. This is a bit more complicated than Smart objectives, a term often used to describe Specific, Measurable, Achievable, Realistic and Timely.

The CIO’s journey is not easy, with a reluctant CFO seeking evidence of prudence and continuous efficiency improvements, before considering new technology programs, which potentially represent a genuine promise. With the pressures of the market, all nature of corporate budgets come under pressure, but none more than “functions” considered as “support” to the core business. IT does fall within this band in a few industries. However, even in sectors which are rather more directly dependent on the use of technology today, there are unrelenting pressures of effective, efficient and competitive use of technology.

There is of course an interesting view-point, which holds a lot of truth when you consider the briefest history of mankind, say, the last two decades alone. Every business is a software business or will be in the near future, as argued eloquently by David Kirkpatrick.  Increasingly the innovative use of technology will create new business models, as it has in the past two decades. It will also provide today’s “traditional” businesses either the reason to excel or collapse in the face of competition. This competition may well come from outside of who they consider as competition today. Until a dozen years ago, Amazon was considered a competitor to Barnes and Noble, not Wal-Mart!

The difficulty of course lies in balancing competing priorities – delivering the service levels for “business as usual”, at a reduced cost, while seeking competitive advantage through the use of new technology. That faster, better, cheaper as a business strategy, by itself will prove inadequate, as evidenced by the famous debacle of Kodak. Hence the need for IT to keep track and keep pace with industry competitors and cross industry practices.

IT Leaders and CIOs in enterprises are always seeking answers, living at the cusp of their own business industry and the ever-changing, young and promising, often over-promising, technology industry. While several strategies for cost reduction have been used and continue to be used CIOs, I suggest that every Monday is a fresh start. Cost savings and efficiencies achieved, while walking the tight rope of service levels and risk mitigation, are history in the next planning cycle.

The popular strategies for IT efficiency have included one or several, such as, rationalization of the application portfolio, modernization of legacy systems, outsourcing of the infrastructure, process transformations and outsourcing of applications management. Obviously each of these strategies has its implementation challenges and risks, and IT teams who achieve results are “heroes” in my view of the world. But all heroes are called upon for more battles, as the war continues.

Next week, I will examine the Seven Steps to Smart IT, a reminder list (or cheat sheet) for all IT Leaders, to examine on a regular basis the smartness of the IT they deploy and lead for their business.

                                                                                      Contributor: Navin Anand