Avoiding the ‘schizophrenic’ IT firm

A pharmaceuticals company we’ve been studying decided to deploy more than 20,000 iPads and other mobile devices to its global sales force to improve its engagement with doctors in emerging and developed markets. Over the next two years, this change in how salespeople interact with customers will redefine what the product content will be, how a new customer relationship management platform can be used to record visits online, and how new insights will be derived from these interactions across sales, marketing and brand management, ultimately driving decisions.

The impact on the company’s information technology organization has been significant. It has never before rolled out something at this speed. Welcome to the new world of IT.

Business leaders are increasingly driving transformation projects in areas like digital marketing, multichannel sales, and product-content and customer-information management, pushing their chief information officers and IT organizations to respond in new and faster ways. The timetable for implementing these projects is often months, not years.

For CIOs, the good news is that they’re now finding themselves at the center of business-related changes with the opportunity to directly influence front-line business results. The bad news – depending on how you look at things – is that business managers’ expectations of the CIO and the IT organization are soaring; they have a “no-excuses” view of IT responsiveness.

This is giving rise to “schizophrenic” IT organizations. One side is focused on running global infrastructure and implementing big-system-application programs over the course of three to five years, where the emphasis is on compliance, security, reliability and effective 24/7 operations. The other side is focused on “making IT happen” rapidly, without the complex plans and multiyear rollouts that have been institutionalized in large IT organizations.

The challenge for C-suite executives, including CIOs, is to avoid an either-or view of IT-enabled business change and to have the maturity to embrace both sides of the challenge at the same time. The logical response might seem to be to restructure and retrain the IT organization to keep up with new demands – in particular, to teach the skills needed to deploy emerging technologies like mobile, social media, analytics and big data. This, we contend, is unlikely to achieve much. A fresh perspective and novel thinking are much more important.

The perspective we are advocating requires a shift away from portraying the challenge as nailing the design, competencies and skills of a separate organizational unit. IT use is pervasive across the organization, so any response should reflect this. Executives must consider IT less from the standpoint of a factory and more from the perspective of how people are managed.

Think about it: As a manager, you are intimately involved in hiring and managing your staff and …(Continued on next page)
appraising their performance; you would never consider delegating those responsibilities to the human resources department. Your colleagues in HR have a role to play, certainly, but it’s an advisory, coordinative and compliance-related role. They may, for example, coordinate with recruiters to identify potential candidates, help position advertisements and work with you to develop talent. Given that you are likely to be critically dependent on information and IT in the performance of your job, why are information and IT treated so differently?

Based on our research, we think organizations should embrace three interdependent roles for managing information and IT: orchestrator, broker and value realizer.

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The orchestrator role involves determining how information will be used across the organization; deciding where enabling investments will be made; defining the architectural standards needed for integration and process standardization; balancing agility and stability; and formulating policies to protect information. This role also incorporates oversight responsibilities.

The broker role revolves around the supply of IT, applications and services. These may be brokered from in-house resources, although it’s increasingly likely that they will be provisioned from external sources. Even if all applications and services are to come from the cloud, this must be done within a framework that takes into account both risk and architectural integrity. The role also entails continually assessing the economics and performance of supply to ensure that the organization continues to get the most bang for its buck.

The value realizer role centers on ensuring that the full value of IT investments is achieved. For new investments, this is about managing organizational change and driving use of information. This change enabled by technology must then be sustained over the life cycle of the investment for all the expected value to be delivered.

While the details of these roles might not be new, how each role will manifest itself in an organization almost certainly will be. We don’t see these roles necessarily corresponding to a particular individual (for example, the CIO); rather, you should treat them as a set of connected behaviors, obligations, beliefs and norms that will affect a broad range of managers and staff in an organization.

Nor are these roles likely to reside in a single organizational unit (the IT function, for instance). The challenge is to reconfigure resources and accountabilities across the organization to meet the remit of these roles. This is where the shift in mindset provides the foundation. This will not be easy, but it’s the challenge business leaders face if they are to avoid a schizophrenic IT organization.

(Donald A. Marchand is a professor of strategy execution and information management at IMD in Lausanne, Switzerland. Joe Peppard is a professor of information systems at Cranfield University’s School of Management in the U.K.)

© The New York Times 2013