When delivering my final dissertation of the MBA program (here the link of a short presentation), along the research I’ve encountered the topic of IT Change Management.
As a matter of fact, whenever a company decides to implement IT innovations most likely new collaborations or partnerships with IT Vendors, consultants or third parties are needed. Usually, within a selection process, IT suppliers are evaluated accordingly to theirs know how and proven expertise. However, what about other aspects such as the agility to change, the ability to innovate and corporates’ cultures? Is there a potential fit or a misfit between the company and the selected IT vendor?
The company’s DNA
In order to avoid failures, it’s fundamental to set a pace for IT innovations that is affordable to the company according to its DNA. According to R. Ray Wang (@rwang0) there are two kind of attitudes when defining a DNA of a company: proactive vs. reactive and incremental vs transformational attitudes.
Cautious Adopters: proactive & incremental (about 30%). Such companies are looking for new technologies without waiting what other competitors do. However, they are willing to implement only the technologies that might play a key role in the future as well as they are not keen to consider the opportunity to change their business model even if the new technology enable a breakthrough.
Market Leaders: proactive & transformational (about 5%). A market leader has the ability to sustain high paces of IT innovations as well as an organizational flexibility to change also its business model.
Laggards: reactive & incremental (30%). Such a company avoid any kind of risk of a self-disruptive innovation and integrates new technology only when other competitor succeed. In any case, without transforming its business model.
Fast Followers: reactive & transformational (15%). This of kind of DNA is able to mitigate the risk of adopting new technology by relying on the ability to change quickly the business model and the organization as a way to survive against disruptive innovation threats.
(More: “The Building Blocks of Successful Corporate IT“, HBR Blog)
IT Vendor’s DNA
What about the DNA of an IT Vendor? Gartner is well-known for providing a “magic” quadrant for everything and also for evaluating an IT vendor: completeness of vision and ability to change are the two main attitudes to consider.
Leaders: high completeness of vision & high ability to execute. As IT vendors, they are able not only to provide innovative services that works today but also to influence the market that theirs innovations are the best for the future. For these reason, such IT vendors might fit best a company with a leadership that wants to invest in new infrastructures\technology early and avoiding any risk due to technology (obsolescence, maintenance, etc.). However, also a cautious adopter (DNA) company that wants to develop a leader DNA should prefer IT leaders by relying on their ability to execute and play a key role as an influencer within a change management process.
Niche Players: low completeness of vision & low ability to execute. Is the case of IT vendors specialized in few functionalities and with low ability to execute due, for example, to a lack of resources (financial, operating) and power (network). However, such IT vendors might be useful for companies that need small technology changes without stringent delivery deadlines. For these reason IT niche players might be extremely useful for Laggard (DNA) companies.
Visionaries: high completeness of vision & low ability to execute. Is the kind of IT vendor that fit best a Cautious Adopter company’s DNA. Anyhow, a Fast Follower (DNA) company that wants to innovate proactively rather than reactively, might get some useful insights from Visionaries third parties.
Challengers: low completeness of vision & high ability to execute. Is what Fast Follower companies usually need. However, a Cautious Adopter company that wants to improve its change management process should look for Challengers as IT vendors.
So, which IT Vendor to chose? Thinking about possible threats due to cultural and organizational divergences between the company and th IT vendor DNAs will ensure the implementation of the strategy as well as it will avoid market\operational risks and a waste of resources: why to invest on IT Vendor Leaders? Does the company really need it?
As a moral of this story, selecting the IT Vendors that fit best the company DNA is not so different as chosing relationships and friends in our every day life. Trusted and better relationships are guaranteed only by knowing ourselves as well as the others.
Feelink – Feel & Think approach for doing life!
This time I want to tell a story of mine. Recently I was struggling with figures regarding a new kind of analysis in the field of procurement, supply chain and inventory management. Something that I’ve never done before.
Since I was too focus on the jungle of numbers and details what happen is that I’ve completely missed the path…I felt myself completely lost in the middle of the forest of figures!
So, my mentor helped me to find the path again in order to complete the analysis with an inspirational metaphor, well-known among logistic and operation professional: the X-band and S-band radars.
The S-band radar
It means be able to patrol what’s going on in the medium-long range in order to anticipate risks proactively. This means, for a logistic professional, taking all the countermeasure in order to properly asses the forecast of the demand in the future as an example. Having a good term vision is essential when planning the procurement of the materials, especially with high lead times, as well as develop a strategic thinking and a wider perspective by monitoring competitors, suppliers and new technology innovations. Demand Driven Supply Chain (DDSC) is possible only thanks to a good S-band radar surveillance.
The X-band radar
It is aimed to work for short-range surveillance, usually below 2-3 thousands Kilometers. For a logistic professional this means beeing able to address the ongoing issues of every day work and thus promptly take the counteractions against the encounter menace: delay of the delivery or a call from the quality control about the noncompliance of the material received with the consequence to stop all the production within a couple of hour. Usually a X-radar is small and it doesn’t weigh too much. Very useful characteristic when dealing with tactical moves.
So, a good professional in logistic has to handle both of the S-band and the X-radar. This is the easiest part. The hardest one is to manage them simultaneously and is what I’ve realized when I was struggling with the figures for the analysis because I’ve temporally switched off my S-band radar. Once I’ve switched it on again, all the numbers for the analysis become suddenly much more clear since it was as well clear the long term purpose and meaning behind the figures.
Anyhow, is this metaphor useful only for logistic professional? According to an interpretation of a famous quote from Hemingway, I would say no:
Today is only one day in all the days that will ever be. But what will happen in all the other days that ever come can depend on what you do today.
Using the X-band radar might also help ourselves in everyday life. Meanwhile, the S-band will clear the fog in front of our perceptions and aspirations in the future.
Feelink – Feel & Think approach for doing life!
Acknowledged the role of IT and technology as a catalyst to change business model (see the previous post “Firm Infrastructure Vs Catalyst to Change Business Models: the Double Side of IT“), how to implement new IT innovations in practice?
Each innovation implies a changing process and each changing process implies commitment and investments…so, which IT innovations to choose in order to avoid a waste of resources? Are the IT innovations under development in line with the customer needs (actual or potential)? Which are the key competences needed for developing a new IT innovation?
Whatever the industry of the company is about, since the focus is customers’ needs, why not thinking how to adapt the NPD (New Product Development) process to IT innovation? The NPD is a structured creativity process focused on introducing new kind of products\services that effectively produces innovations.
In particular, the NPD process combines lateral (generations of ideas) and vertical thinking (selections of ideas) together and it is divided into four stages: ideas brainstorming, ideas classifications, ideas evaluation and ideas selection.
NPD stage 1: ideas brainstorming (lateral thinking)
In this stage all the team members engaged simply write down new ideas without any kind of filter or criticism (lateral thinking). Taking as an example the case of TripAdvisor (see “Tripadvisor: a case study to think why bigdata variety matters“) where a validation process of the reviews is in place by recording on a database the receipts of the end-user at the restaurant: which might be the new innovations available by using the data of the receipts?
NPD stage 2: ideas classification (vertical thinking) – KJ Method
Now, since usually a brainstorming session generate chaos, how to figure out which IT innovations to implement?
Like navigating in the middle of a storm, just stay focus on the ongoing issues, do not think to a final solution and keep clam. So a first step is to organized ideas in a structure way in order to figure out a big picture. An approach for classifying the brainstormed ideas is the KJ method, where all the initiatives are split into groups by using a criteria. For example, criteria for classifying IT innovations could be: which are the departments\functions involved by the IT innovation? Or\And, which are the stakeholders (customer, suppliers, third parties,…) involved?
Then, for each group of ideas, assign a tag that identifies it. For example, suppliers IT innovation, marketing & sales IT innovations, and so on.
NPD stage 3: ideas evaluation (vertical thinking) – QFD Matrix
Once ideas are grouped and tagged, the next step is to identify the key performances that are needed in order to implement new IT initiatives. Typically, regarding IT stuff, they are about DataBase (storage, number of transactions,…), architectures, maintenance costs, usability, interoperability,…
By putting IT initiatives into rows and the key IT characteristics into columns, the finial result is a matrix called QFD (Quality Function Development). Briefly, the QFD matrix connects the IT initiative with the needed performances. For these reasons, the QFD matrix applied to IT innovations might be useful also for procurement: which are the key competences? Make or Buy? If buy, which IT vendor to choose?
NPD stage 4: ideas selection (vertical thinking) – Pugh Matrix
Just for a recap. We have organized the ideas, we have identified the key characteristics for each IT initiative… and so? Which IT initiative to implement? The answer is provided by the so called Pugh Matrix where, for the development of a new product or service, evaluates ideas and solutions according to a gap analysis. In particular, how much the new idea will be valuable for the customer? Will the new idea provide a competitive advantage against competitors?
A similar evaluation should be adopted also for IT innovation. Why? Just think about the risks correlated when IT becomes so complex to be maintained and thus a nightmare for customers, employees and suppliers as well.
Too much enthusiasm on IT initiatives has a side effect to much IT complexity. How to innovate without adding superfluous IT complexity? What about using NITID (New IT Initiative Development), a revised NPD method widely use for product innovations?
Feelink – Feel & Think approach for doing life!
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Feelink - Feel & Think approach for doing life!
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