All Posts in Office Politics

|In: Leadership|Last Updated:

As American businesses continue in their drive to make themselves emaciated and unpleasant … lean and mean, that is … IT frequently finds itself caught in the cross-hairs. The Kafkaesque dialog that often ensues is filled with traps for the unwary, and in particular with veiled accusations for which all possible responses are admissions of guilt.

“Like the rest of the company, IT has to do more with less,” is one of those accusations hidden in a statement. You’re stuck: Claim you’re already running as lean as possible and you’ll lose your status as a team player, not to mention your credibility. Offer to cut expenses while delivering more and you’re admitting IT has a bloated budget that desperately needs trimming. How can you walk this tightrope?

Start by mastering the art of ManagementSpeak. You need to practice some doubletalk that gets you out of the conversation. The specifics are left as an exercise for the reader. Use your ingenuity.

Once you’re out of the room with your skin intact, you need a plan. Where exactly should you look as you try to “do more with less”? That’s what this and the next several columns are for.

To organize the search we’ll use the IT Effectiveness Framework and performance factor maps my consulting company, IT Catalysts, Inc., developed to assess and analyze IT organizations. The complete framework includes 137 factors that drive IT performance, divided into four categories: Business alignment, process maturity, technical architecture, and human performance. We aren’t going to walk through all 137 factors, only those with the best chance of getting you where you need to go. (The process of obtaining permission from IT Catalysts to use the framework was, if you’re wondering, a Smeagol/Gollum-like conversation. Luckily, Smeagol won.)

Start with business alignment, the buzzwordy version of, “How IT knows what it should be working on.” It covers trendy-sounding subjects like “governance” and more prosaic ones like budgeting.

It also includes the relationship between IT and the rest of the business — the single most important determinant of IT effectiveness. One piece of the relationship is simple — is it good, bad, or someplace in between. If it isn’t good, make it good: Nothing else has higher priority than that.

The other aspect of this factor is how it is formally defined: Is IT supposed to be a collaborative partner with the rest of the business, a supplier for whom the rest of the business constitutes “internal customers,” or an information utility, supplying the core IT infrastructure and applications used by embedded business-unit IT organizations to satisfy business requirements?

You need clarity on this point. If you’re supposed to be a supplier to the rest of the business (or an information utility, which amounts to being a wholesale supplier) you can stop. This isn’t a particularly good model, but if the business insists on it you need to start running IT like a real business … as a profit center. Instead of doing more with less, focus on your catalog of products and services and how you price them. Supplier/customer relationships get into the most trouble when IT can’t charge for its services, because then the true relationship isn’t one of supplier and customer. It’s more master and slave, or maybe government agency and constituency — the connection between supply and demand has been severed.

If, on the other hand, the business is more enlightened and IT is a full collaborator, you might have opportunities. Review last year’s projects. If some failed for reasons external to IT … for example, because the affected business areas weren’t able to supply the project staff needed to achieve success … then improving IT governance, using the screening process introduced a couple of weeks ago, will reduce waste by eliminating the initiatives most likely to fail.

This is your single best shot at doing more with less: You can claim success by simply doing less. Which is to say, if you cut out all the effort devoted to initiatives doomed to failure in the first place you can cut your budget without reducing the value you deliver. Who knows? Maybe you can even squeeze in a few more projects that can succeed.

Sure, it’s smoke and mirrors, but who cares? Few business executives are lexicographic purists. They won’t care about the difference between doing more with less and achieving more with less.

And anyway, what you achieve is what matters.

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|In: Leadership|Last Updated:

Like the rest of the country, Minnesota is in the throes of the “tax revolt.” It’s premise is that we can cut taxes without pain because there’s plenty of waste in government. Somehow, though, when budget-trimming time rolls around, the waste pulls a vanishing act, and we’re told we have to make painful choices.

Sound familiar? It should. It’s the public sector equivalent of “eliminating non-value-adding activities,” a sham exercise American business executives buy from expensive executive-suite consultants for similar reasons: They want it to be valid, because if it is they can increase profits without having to make difficult choices.

Are there wasteful government programs? I’m sure there are, although most of the examples I hear are either rounding-error-size activities, programs whose value or lack thereof depends on the political philosophy of the observer, or employment programs that simply recycle tax dollars into the economy where they turn back into tax dollars. I’m equally sure the real waste in government hides where nobody is looking for it: Not in the list of programs but in their execution.

If anyone really wanted to find government waste they’d be asking line employees, front-line supervisors and middle managers where they spend money and effort stupidly, and why. But doing that would require painstaking effort to assemble a detailed understanding of how things are put together. More, it would require a form of taking responsibility that’s become increasingly unpopular: Those making the rules would have to acknowledge that the rules they’ve established are often the problem.

The same is true in business. While many businesses indulge in pet programs that don’t contribute much to the bottom line, they’re hard to distinguish from pilot projects that could pay huge dividends in the future. So the search for non-value-adding activities usually yields just a single item: The very expensive search for non-value-adding activities. After all, very few employees, or managers, or executives go to work every day saying to themselves, “I think today I’ll find a new way to squander the corporate budget on pointless efforts that distract us from building great products and attracting and retaining customers.”

What does happen is that somewhere in the rules, regulations, policies and procedures — often those created to prevent mistakes — lie opportunities to work more efficiently. As in government it’s the line employees, front-line supervisors and middle managers who know where to find them. The problem is also the same as in government: They have no place to take a good idea, nor does anyone actively seek the good ideas they have.

Here’s an example every manager in the federal government knows, but which hasn’t been fixed despite 25 years of tax reductions: Use-it-or-lose-it budgeting. Intended to reduce costs, it has the exact opposite effect. It requires every manager in government to engage in a year-end spending spree, not because they’re irresponsible but because, just like their private sector counterparts, they need to make sure they have enough funds in next year’s budget to get the job done.

Imagine the impact of a change in the rules. Instead of cutting next year’s budget if this year’s numbers look good, the opposite happens. Managers, supervisors and staff share 20% of the savings; another 20% is carried over to the following year, and the remaining 60% goes to cutting the cost of government. Is there any doubt what would happen?

That’s just one example. (It’s a freebie. If your local government would like to engage the services of my consulting company, we’ll be happy to find others.) It illustrates an important point that applies to your business and IT organization just as much as it applies to government spending: If there’s waste to be found, finding it will require two changes in attitude.

The first is that the waste will be easy to find and eliminate. It won’t. It will lie in the details of day-to-day work. While some opportunities will be easy to spot, most will require significant digging. Eliminating the waste will always be hard, calling for intelligent organizational redesign, strong leadership, and political courage. The most difficult part of all will be finding the benefits in accounting reports, which rarely reveal the connection between cause and effect.

The second change will be an even harder one for many business executives to accept than the first. It’s that the fault, to paraphrase Cassius, lies not in their employees but in the unintended consequences of their own decisions.

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