How IT leaders respond to rapid and even random change will be a strategic differentiator well into the 21st century. The keys to success are to involve as many managers as possible with the help of a skilled facilitator and to uncover and surface the real issues and gaps in the organization that are keeping people from increasing their productivity. After uncovering the real issues, there must be a commitment to action planning and implementation.
As the millennium approaches, information technology professionals face unprecedented challenges generated by an evolution in the pace of change -- from incremental to rapid and, in some cases, random and chaotic.(n1) To remain competitive, successful businesses, and especially IT departments, must become proficient at anticipating, managing, and profiting from these new change demands.
Among IT professionals, change historically has been addressed in one of four ways:
1. Contentment -- 20% like things the way they are.
2. Denial -- 20% feel everything is just fine. No need to worry.
3. Confusion -- 40% find themselves in the biggest mess they have ever seen and need help.
4. Organization renewal and workforce transformation -- 20% have so many opportunities. What are their priorities and what should they do first?
These people are often well known: the CIOs and IT executives in categories 1 and 2 are generally the people read about in the computer press who are being relieved of their responsibilities. On the other hand, CIOs and IT executives in categories 3 and 4 are actually worldclass organizations, or approaching world class, because they are dealing with the problems as opposed to brushing them under the rug.
Because of this movement from incremental to rapid change and even chaos theory, many IT leaders recognize the importance of taking time out with their leadership team off site for a one- or two-day team-building session. In the past most IT organizations might do an off-site meeting every two years, if they were lucky. However, in time-based competition, there is a need to do these off-site meetings every six months to ensure that the changes influencing IT departments will be integrated into IT strategies that also complement the business goals of the enterprise.
Efficient application of information technology gave many organizations a competitive advantage in the 1970s and 1980s, which will be reinforced by the strategic use of human resources in the 21st century. Because over 50% of the typical IT budget is human cost and because IT departments will be plagued by a continuing shortage of qualified IT people,(n2) valuing human resources and managing change will be critical factors for success. Those organizations that manage their human resources exceptionally well will realize the benefits generated from increased motivation, productivity, and lower turnover rates.
One proactive strategy for dealing with business alignment and human/cultural problems is a Team Building/Opportunity Identification Retreat. A recent Team Building/Opportunity Identification Retreat for a West Coast telecommunications company, which was moderated by the authors, was unusually successful and illustrates a process to plan for change, increase IT alignment with the business objectives of the enterprise, and reinforce the value assigned to human resources. After all, when people feel valued they add value to the customer.(n3)
CASE STUDY
The telecommunication company in this case study is a diversified provider of telecommunications services to the Pacific Coast and global markets. Through their subsidiaries, they provide local telephone exchange services, long distance telephone services to nine western states, and telephone services to international markets. With a headquarters IT staff of approximately 200 people who are responsible for planning, standardization, and strategy, they are well positioned to leverage their human resources to reinforce their competitive position. The CIO manages five departments:
1. Applications Development,
2. Data Center,
3. Data Networks and Administration,
4. Information Center, and
5. IS Planning & Support.
In early 1997, an off-site team-building session was held at a West Coast resort with the first author acting as facilitator and coach. The off-site location was essential for getting people away from the daily crisis, free from the interruptions of the telephone and drop-ins, where they could be creative and innovative.
MEASUREMENT
Before the two-day off-site retreat began, a software metrics package titled "360 Degree Benchmarking"(n4) was administered to all 200 people to determine baseline measures and to later repeat the measure to quantify the value of the team-building sessions. Specific areas measured were software development, maintenance, operations, networks, people/culture, and financials. Somewhere during this process the CEO or CFO will ask for metrics, and it is better to be upfront and collect this data before the intervention.
THE OBJECTIVE
The objective of the team-building off-site meeting was to fine tune performance by identifying issues inhibiting alignment with the business objectives, goal accomplishment, and resolving problems through a unified leadership team approach. After all, once problems are identified, action planning can begin. Time and effort are scarce resources in IS and frequently this process alone surfaces and solves 80% of the problems with 20% of the effort.
THE PROCESS
The retreat methodology uses a modified Delphi process to elicit views from each person on the IT leadership team. In addition to the valuable information compiled, the process builds an attitude of team participation, recognition, and unity of purpose. Thirty IT leaders, project leaders, and supervisors from the IT organization participated in this off-site session.
The process provided all 200 individual contributors and IT leaders a broader perspective of the goals within their own functional areas and their relationship to organizational goals. It also helped the participants to focus on the need for consensus in resolving crucial IS issues. The Delphi process and use of an outside organizational transformation resources coach helped ensure quality input on those practices that may have prevented the IT organization from achieving maximum alignment, motivation, and productivity.
THE AGENDA
Before arriving at the off-site resort, participants were placed into four teams by the CIO and the facilitator. Spread over two and a half days, eight sessions were conducted, some with all teams assembled together and others as individual team breakout sessions.
Session 1: Introduction and Objectives
An explanation of the objectives for the workshop and the methodology employed was presented, with an emphasis on how human productivity can be increased through improved management. Also, there was a discussion of the drivers of change. Further, the leaders received a lecture on what motivates IT people and what the IT organization of the future (learning organization) will be like. Finally, the total leadership team was led through a discussion of the following:
What will the communication industry look like in the year 2001?
If everything was perfect, what should an organization look like in the year 2001?
What does an IT organization have to do to achieve year 2001 goals?
Session 2: Teams Identify Three Best Things about the Organization
Working in teams, positive aspects of the organization were identified. This exercise reinforced the fact that organizations are not all bad news and encouraged participants to view the process as a team effort.
Session 3: Share Positive Findings Reports
After bringing the teams together the lists of positive attributes generated by each team were shared with one another.
Session 4: identify Three Things Needing Improvement
Working within their teams, participants developed a further definition of the performance gaps that needed improvement to move toward a more customer-driven environment. Individual team lists were then consolidated and ranked using a Delphi process.
Session 5: Present Negative Report Findings
Team leaders presented to all participants the consolidated and ranked lists of items perceived as needing improvement.
Session 6: Consolidation of Problems Set and Selection of Problems for Resolution
As a group, a consolidated list of all the problems presented in Session 5 was prepared. Entries were eliminated and duplicates combined using group consensus. The problems were then ranked to determine the top ten.
Session 7: Management Team Assignment and Action Plans
Teams were assigned to work on categories of problems. They briefly met to define formally the problems and generate outlines of an action plan for addressing each challenge.
Session 8: Presentation of Action Plans
Reconvening as a group, each team leader presented the problem definitions and action plans. This was a lively session characterized by strong opinions and debate, which identified creative ideas to resolve their pressing needs.
OUTCOMES
Before consolidation and ranking, the IT leadership team had identified 35 problems (gaps) for additional consideration and evaluation. After dinner on the second evening, the CIO and facilitator selected the top four problems (gaps) that had the greatest negative impact on IT individual contributors and assigned these challenges to the four teams for resolution. It is important to note that the teams would operate as cross-functional teams after the retreat ended and would remain a team until their solution was implemented.
The four problems worked on by the cross-functional teams during day three were as follows:
1. Establishing Effective Planning, Prioritizing, and Communication Protocols. Lack of formal planning was identified as a key to poor communication. The perception was that poor communication existed between IS departments, as well as with other divisions of the company. Also, there was not a clear priority-setting process for projects by the business units. This was related to poor planning and communication.
2. How to Pick and Keep Eagles. Procedures and policies related to attracting and retaining quality employees were described as obsolete, ineffective, and in need of change if employee retention objectives were to be realized.
3. Using Compensation to Reinforce Teamwork. An inflexible recognition and reward program made it difficult to provide appropriate compensation to deserving individuals. Also, the IT leadership team recognized that some percentage of the annual merit increase should be based on team performance and accomplishments.
4. Bureaucracy Bashing. A number of problems within the IT department were regarded as impediments to business improvement. Suggestions included cutting red tape, simplifying internal processes, developing a feedback mechanism, and establishing a Quality Improvement Council.
In the spirit of improving communication and obtaining buy-in within the IT department, team leaders briefed each other subsequent to the completion of their respective action plans. The CIO then approved the action plans and assigned each team a deadline for presenting an implementation schedule to the IT leadership team and their customers.
The final item of the retreat was to design a strategy for feedback on what happened at the off-site sessions for those who were still back at the ranch. It was determined that a letter would be sent from the CIO to all individual contributors with follow-up by individual managers at their respective staff meetings. Also, a schedule was established for the CIO and leader of each cross-functional team to visit the business units and brief them on the off-site retreat.
FOLLOW-UP AND RESULTS
After the retreat, each of the four cross-functional teams began operating independently as task forces by devoting one half day a week to working on their action items. Details on the problems and action plans developed during the retreat were formalized and put into operation. A variety of management practices and techniques were used during this phase of the process including interviews, meetings with the human resource management, customers, individual contributors, IS management, employee surveys, questionnaires, literature searches, benchmarking trips to other IT departments, and even statistical analysis.
Also, it was decided that the IT leadership team would meet once a month to have updates on progress and review the upcoming challenges. These meetings, featuring communication of performance expectations, illustrate the importance of communication to the business enterprise.
Many of the original issues and gaps have been resolved. Some required only simple procedural changes within the department, others merely a clarification of existing company and department policies (communication once again) to satisfy the matter.
A few of the personnel and compensation issues could not be addressed directly by the team. These were elevated to the human resources department in the form of suggestions and recommendations for their consideration. Several have been adopted, but others would require changes in company policy. Interestingly, although some of the issues have not, and perhaps will never be resolved, just knowing why has done much to thwart disappointment. The process helps close the gap on the unknown, and it is the unknown that human nature dislikes.
Although a great deal has been accomplished toward resolving many of the issues identified at the retreat, there is much yet to be done. The process is an ongoing one. Although resolving issues is important, a secondary benefit is the increased improvement in alignment around organizational goals and communication between IT and IT customers, and among IT leaders and individual contributors.
To continue the process of improvement, the IT leadership teams plan to repeat the 360 Degree Benchmarking metrics during mid-1998 to measure statistically the value added by this team-building process.
SUMMARY AND CONCLUSIONS
How IT leaders respond to rapid and even random change will be a strategic differentiator well into the 21st century. Only one strategy was described that can be used to manage change; however, the key to success is to involve as many managers as possible, with the help of a skilled facilitator, to uncover and surface the real issues and gaps in the organization that are keeping employees from increasing productivity. After uncovering the real issues, there must be a commitment to action planning and implementation. Finally, because change is inevitable, efforts must be made to plan and manage changes in IT organizations, especially on the human resources side.
Notes
(n1.) Zawacki, Robert A., Norman, Carol A., Zawacki, Paul A., and Applegate, Paul D., Transforming the Mature IT Organization: Reenergizing and Motivating People, EagleStar Publishing, 1995, p. 22.
(n2.) This shortage will continue due to the decrease of college computer science undergraduates, diversion of skilled staff to work on the Year 2000 problem, and use of Web pages.
(n3.) A recent example of this philosophy was published in the September 29, 1997 (page 262) issue of Fortune, where Howard Schultz, CEO of Starbucks said, "Our first priority was to take care of our people, because they were the ones responsible for communicating our passion to our customers."
(n4.) 360 Degree Benchmarking (tm) is a trademark of Technology & Business Integrators, Inc. (TBI), Woodcliff Lake, NJ. This service analyzes the information technology function for five critical areas: human resources/culture, software development, network platform services, data center, and enterprise IT investments.
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By Robert A. Zawacki and Howard Lackow
DR. ROBERT A. ZAWACKI is Professor Emeritus of Management & International Business, University of Colorado, and Technology & Business Integrators Distinguished Scholar in Residence. He can be contacted at robertz@zawacki.com
HOWARD LACKOW is Executive Vice President and Director of Consulting for TBI, a business-oriented management, technology, outsourcing, and performance measurement firm. Mr. Lackow can be reached at hlacbow@tbicentral.com.
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Source: Information Systems Management, Summer98, Vol. 15 Issue 5, p36, 4p.
Item Number: 943432