tag:blogger.com,1999:blog-23860230957955822872024-02-19T01:13:32.582-08:00The business value of IT by David GwillimMy CEO was screaming at me “prove to me the value IT delivers to the business, where is the bang for my buck?” That started me on a quest to identify and understand the value of IT in an organisation, not to just blindly accept that IT added value as I had in the past. This weekly blog will cover a wide range of technology management issues focusing on IT value, IT benefits, IT strategic competitive advantage and the information revolution and social computing revolutions.David Gwillim, M.Bus(IT Mgmt), B.Ec, CPA, PMP, CSM, CSA(cert)http://www.blogger.com/profile/02046650076395494634noreply@blogger.comBlogger39125tag:blogger.com,1999:blog-2386023095795582287.post-92011078014256168542014-07-11T18:11:00.003-07:002014-07-11T18:12:28.165-07:00IT & Marketing the relationship you can no longer ignore<span style="font-family: Calibri;">Earlier this year I looked at why, if IT could not report
to the CEO, then reporting to the Chief Marketing Officer makes good, if unconventional sense.
Enter the July/August edition of Harvard Business Review and an article by
Scott Brinker and Laura McLellan titled “The Rise of The Chief Marketing
Technologist”. Their article draws on Gartner research and predictions and some
of the statistics are remarkable, the most memorable being Gartner’s 2012
prediction that by 2017 the CMO will be spending more on technology than the
CIO will. This is not necessarily dreamland when considering that digital
marketing spending is experiencing double digit growth every year; CEO’s
identify digital marketing as the most important technology powered investments
their firm can make; e-commerce continues to rise rapidly; and the typical
marketing supply chain of agencies, media outlets and industry researchers are
embracing (and in many cases pioneered in many organisation) digital workflows.</span><br />
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<o:p><span style="font-family: Calibri;"> </span></o:p><span style="font-family: Calibri;">The authors claim 81% of large companies now have a Chief
Marketing Technologist reporting directly into the marketing organisation, with
a (sometimes) dotted line to IT. Their role is to bridge the gap between IT and
marketing, working with the senior marketing executives, selecting and working
with 3<sup><span style="font-size: x-small;">rd</span></sup> party software and service providers, the general marketing
team and the CIO/IT organisation.</span></div>
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<span style="font-family: Calibri;">When I originally penned questions about the future of
internal IT departments around 10 years ago as part of my IT governance
lectures, I identified many emerging challenges to the typical IT team such as
automation, outsourcing and offshoring, increasingly user friendly
applications, and the rapidly increasing IT savvy of others in the organisation
especially the younger ‘digital natives’ as they filter through organisations
into management. At the time my IT management peers (including a CIO round
table I was a member of and presented this to) seemed unconcerned at these
potential challenges. The rapid ascension of the marketing department as the
dominant IT consumer in an organisation, is only now getting attention in the
CIO press and senior IT circles, is it too late?</span></div>
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<span style="font-family: Calibri;">Brinker, S. & McLellan, L., 2014, The Rise of the Chief
Marketing Officer, in Harvard Business Review, July-August 2014, p.83-85</span></div>
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<div style="background: white; margin: 0cm 0cm 0pt; mso-line-height-alt: 7.95pt;">
<a href="http://businessitvalue.blogspot.com/"><i><span style="color: #2288bb; font-family: "Calibri","sans-serif"; mso-ascii-theme-font: minor-latin; mso-bidi-font-family: Arial; mso-hansi-theme-font: minor-latin;">David
Gwillim</span></i></a><span style="color: #222222; font-family: "Calibri","sans-serif"; mso-ascii-theme-font: minor-latin; mso-bidi-font-family: Arial; mso-hansi-theme-font: minor-latin;"><o:p></o:p></span></div>
<i><span style="color: #222222; font-family: "Calibri","sans-serif"; mso-ascii-theme-font: minor-latin; mso-bidi-font-family: Arial; mso-hansi-theme-font: minor-latin;">Exploring the value of IT to organisations</span></i><span style="color: #222222; font-family: "Calibri","sans-serif"; mso-ascii-theme-font: minor-latin; mso-bidi-font-family: Arial; mso-hansi-theme-font: minor-latin;"><o:p></o:p></span><br />
<i><span style="color: #222222; font-family: "Calibri","sans-serif"; mso-ascii-theme-font: minor-latin; mso-bidi-font-family: Arial; mso-hansi-theme-font: minor-latin;">email: david.gwillim@optusnet.com.au</span></i><span style="color: #222222; font-family: "Calibri","sans-serif"; mso-ascii-theme-font: minor-latin; mso-bidi-font-family: Arial; mso-hansi-theme-font: minor-latin;"><o:p></o:p></span><br />
<i><span style="color: #222222; font-family: "Calibri","sans-serif"; font-size: 11pt; line-height: 115%; mso-ansi-language: EN-AU; mso-ascii-theme-font: minor-latin; mso-bidi-font-family: Arial; mso-bidi-language: AR-SA; mso-fareast-font-family: Calibri; mso-fareast-language: EN-US; mso-fareast-theme-font: minor-latin; mso-hansi-theme-font: minor-latin;">blog: </span></i><span style="font-family: "Calibri","sans-serif"; font-size: 11pt; line-height: 115%; mso-ansi-language: EN-AU; mso-ascii-theme-font: minor-latin; mso-bidi-font-family: "Times New Roman"; mso-bidi-language: AR-SA; mso-bidi-theme-font: minor-bidi; mso-fareast-font-family: Calibri; mso-fareast-language: EN-US; mso-fareast-theme-font: minor-latin; mso-hansi-theme-font: minor-latin;"><a href="http://www.businessitvalue.blogspot.com/"><i><span style="background: white; mso-bidi-font-family: Arial;"><span style="color: blue;">http://www.businessitvalue.blogspot.com/</span></span></i></a></span>David Gwillim, M.Bus(IT Mgmt), B.Ec, CPA, PMP, CSM, CSA(cert)http://www.blogger.com/profile/02046650076395494634noreply@blogger.com0tag:blogger.com,1999:blog-2386023095795582287.post-83030748133449681042014-04-23T04:38:00.003-07:002014-04-23T04:38:59.556-07:00Why does "strategic focus" work?In the latest McKinsey Quarterly three authors report on their research on what successful companies do. They identify 4 recipes of successful companies, that “reflect a distinct underlying approach to managing, including core beliefs about value creation and what drives organisational success” (Smet, Schaninger & Smith, "The hidden value of organisational health - and how to capure it", McKinsey Quarterly, April 2014).<br />
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<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjqOiHkj55oR8B8iCd5z2jj-BeC6aLYx2aPOxSL96lk8YL5PZPY20vZlsNOU_yif668mJiZW2-h41EogyIkAeS0GiEVdRyQbRZ1ruVba7_mpSDmpcBDAkI38L1qg1JjkpjetkdM3_Npwfyu/s1600/business+models.jpg" imageanchor="1" style="clear: left; float: left; margin-bottom: 1em; margin-right: 1em;"><img border="0" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjqOiHkj55oR8B8iCd5z2jj-BeC6aLYx2aPOxSL96lk8YL5PZPY20vZlsNOU_yif668mJiZW2-h41EogyIkAeS0GiEVdRyQbRZ1ruVba7_mpSDmpcBDAkI38L1qg1JjkpjetkdM3_Npwfyu/s1600/business+models.jpg" height="157" width="400" /></a><br /><br />
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There are of course lots of other ‘recipes’ out there from Michael Porters generic strategies of segmentation, differentiation or cost leadership; Treacy & Wiersema’s (HBR Jan’1993) value disciplines of customer intimacy, operational excellence and product leadership; Peter Weill’s operating models; and research by the Balanced Scorecard Collective led by David Norton into the successful modes of strategic alignment, all identify attributes of successful companies. What is remarkable about all these models is the persistent conclusion by these authors that successful organisations choose consciously or unconsciously what they will do and will not do rather than trying to do and excel in everything, and that the activities they choose to focus on are consistent and complementary to each other. What is also remarkable is that the exact details of the ‘recipe’ seems to be less important that the relationship of the actual goals and priorities to each other, as evidenced by the wide variety of models/recipes championed by the various authors.<br />
What appears to be lacking in these models is research into why some selective choices are so successful rather than other choices or trying to excel at everything. The obvious economists answer would be that organisations are resource constrained and therefore they need to concentrate their efforts (allocation of scarce resources) in one or a limited number of areas where they get maximum bang for their buck, however this does not explain why very different models/recipes can all be successful while mixing other elements together or doing everything leads to failure.<br />I suspect the answer is more about people and psychology than economics and lies in the fact that an organisation that focuses on a specific area of expertise makes it easy for customers to understand what it stands for (marketing 101), is easy for employees to understand and act consistently/empowered (HR 101)and critically, it is easy for managers, especially senior executives to make decisions that are consistent with the organisations focus when allocating those scarce resources (especially their executive mindshare).<br />
Many moons ago I did a personal goal setting exercise that was truly eye opening. The first step was to identify all my short and long term goals and dreams around work, family, health, education, wealth, spiritual self etc and document them in a long list. The second step was to build a grid on a sheet of paper with each goal listed along both the X axis and the Y axis creating a matrix. The final step was the real eye opener. For each pair of personal goals a notation was made on the matrix where they intersected. A ‘+’ was added if the two goals were complimentary or reinforcing, a ‘-‘ if they clashed or were mutually exclusive, and a ‘n’ if they were neutral. The value of the exercise was in showing where friction occurred between my goals causing personal stress, where others were likely to get mixed messages and be confused about who I am and what my priorities are, and what clusters of activities/goals support the personal my life’s mission/purpose (it also helped identify that purpose). It also helped consign to pure fantasy a few goals that were unobtainable due to incompatibility with my life’s purpose.<br />
The same exercise could be applied to an organisation to assist in evaluating complimentary and contradictory goals to an organisation, I suspect it would help an organisation understand what goals/activities support its mission and those that do not. Perhaps something to do at your next executive strategy sessionDavid Gwillim, M.Bus(IT Mgmt), B.Ec, CPA, PMP, CSM, CSA(cert)http://www.blogger.com/profile/02046650076395494634noreply@blogger.com0tag:blogger.com,1999:blog-2386023095795582287.post-21648835575573675862014-02-18T19:02:00.000-08:002014-02-18T19:02:29.844-08:00Should IT report to marketing?The idea is not as silly as it sounds.<br />
<br />CIOInsight magazine last week reported on a new IDC report on how the CIO role will change by 2018, the report identified getting close to marketing as 3 of the key trends/challenges for CIO’s due to marketing’s ownership of social media, digital engagement with customers and innovation and concerns that unless IT partners with marketing they will be left behind. Peter Weill in his CISR research briefing in May 2013 “Managing Total Digitalization: The Next frontier” identified that many business technologies are often developed and managed outside of IT such as: digital products, robots for production, CAD systems, telephone networks, digital games, digital services and social media strategies and sensors in a range of devices. Weill argues that enterprises need to take a holistic view of their digital platforms and give IT control over enterprise digitalization.<br />
<br />I am going to go a step further than IDC and Weill and suggest that IT should be reporting directly to the Chief Marketing Officer (CMO). There is one important exception to this, and that is where IT ‘is’ the organisations strategy and reports directly to the CEO. An organisations digital footprint has expended way beyond the automation of back office processes and is now a key tool for interacting with customers and a driver of business growth. CIO’s and other technology professionals are well placed to advise and manage the technical side of the digital enterprise however they are being locked out of the extended digital platforms especially digital interactions with customers and user experience which are owned by the chief marketing officer and marketing team. Having IT reporting to/teamed with marketing would ensure the organisation digitalises as fast as possible while producing agile and scalable solutions. <br />
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This is far preferable to the alternative of IT reporting to the CFO or COO (historical artefact of business process automation) both of which are focused on cost control rather than innovation and business growth, hence marketing and other customer facing areas preference for avoiding IT and going it alone. <br />
So, should IT report to marketing?<br />
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Links and references:<br />CIOInsight article <a href="http://www.cioinsight.com/it-news-trends/slideshows/how-the-cios-role-will-change-by-2018.html/?kc=CIOMINEPNL02122014&dni=105641598&rni=23734261">http://www.cioinsight.com/it-news-trends/slideshows/how-the-cios-role-will-change-by-2018.html/?kc=CIOMINEPNL02122014&dni=105641598&rni=23734261</a> <br />Weill & Woerner, 2013, Managing Total Digitalization: The next Frontier, CISR Research Briefing, Vol XIII, Number 5, May 2013 <a href="http://cisr.mit.edu/blog/documents/2013/05/16/2013_0501_managingtotaldigitization_weillwoerner.pdf/">http://cisr.mit.edu/blog/documents/2013/05/16/2013_0501_managingtotaldigitization_weillwoerner.pdf/</a><br />
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<a href="http://businessitvalue.blogspot.com/"><i><span style="color: #2288bb; font-family: "Calibri","sans-serif"; mso-ascii-theme-font: minor-latin; mso-bidi-font-family: Arial; mso-hansi-theme-font: minor-latin;">David
Gwillim</span></i></a><span style="color: #222222; font-family: "Calibri","sans-serif"; mso-ascii-theme-font: minor-latin; mso-bidi-font-family: Arial; mso-hansi-theme-font: minor-latin;"><o:p></o:p></span></div>
<i><span style="color: #222222; font-family: "Calibri","sans-serif"; mso-ascii-theme-font: minor-latin; mso-bidi-font-family: Arial; mso-hansi-theme-font: minor-latin;">Exploring the value of IT to organisations</span></i><span style="color: #222222; font-family: "Calibri","sans-serif"; mso-ascii-theme-font: minor-latin; mso-bidi-font-family: Arial; mso-hansi-theme-font: minor-latin;"><o:p></o:p></span><br />
<i><span style="color: #222222; font-family: "Calibri","sans-serif"; mso-ascii-theme-font: minor-latin; mso-bidi-font-family: Arial; mso-hansi-theme-font: minor-latin;">email: david.gwillim@optusnet.com.au</span></i><span style="color: #222222; font-family: "Calibri","sans-serif"; mso-ascii-theme-font: minor-latin; mso-bidi-font-family: Arial; mso-hansi-theme-font: minor-latin;"><o:p></o:p></span><br />
<i><span style="color: #222222; mso-bidi-font-family: Arial;"><span style="font-family: Calibri;">blog: </span></span></i><a href="http://www.businessitvalue.blogspot.com/"><i><span style="background: white; mso-bidi-font-family: Arial;"><span style="color: blue; font-family: Calibri;">http://www.businessitvalue.blogspot.com/</span></span></i></a><br />
David Gwillim, M.Bus(IT Mgmt), B.Ec, CPA, PMP, CSM, CSA(cert)http://www.blogger.com/profile/02046650076395494634noreply@blogger.com0tag:blogger.com,1999:blog-2386023095795582287.post-27488310953843427822013-12-04T15:19:00.000-08:002013-12-04T15:19:17.129-08:00Why is engaging knowledge workers so hard? And it’s not because knowledge workers are hard to engage.Why is engaging knowledge workers so hard? And it’s not because knowledge workers are hard to engage. Gallup recently published a summary (State of global workplace 2013) of their many survey’s on employee engagement. Which they define as “employees work with passion and feel a profound connection to their company, they drive innovation and move the organisation forward’. Globally only 13% of employees were engaged. The numbers for Australia are slightly better at 24% engaged, 60% not engaged and 16% actively disengaged, the actively disengaged workers actually sabotage their employers and work colleagues. Why do most companies get engagement so wrong? Even Taylor’s studies back in the dawn of scientific management showed engaged workers are more productive, and that was on assembly lines where knowledge was not the premium human resource it is today.<br />
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I have written before at my bemusement of watching senior management struggle with engagement and plan more meetings, more incentives and if that fails more beatings to improve ‘engagement’. I have always had a pretty simple measure of engagement “if you leave the office feeling you have achieved something that day, then you are engaged”, the problem then is how to get employees to feel successful and valued. That is why engagement scores of divisions in a company that are meeting targets and gaining positive attention are always higher than divisions that are viewed as not meeting targets or ‘just cost centres’, it’s not that hard.<br />
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Rosabeth Moss Kanter a Harvard professor has recently added more depth to the concept of ‘feeling you have achieve something’. She identifies 3 factors strongly linked to employee engagement, they are:<br />
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<b>Mastery:</b> Developing and improving deep skills, being challenged to do things betters and faster.<br />
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<b>Membership:</b> Create community by honouring the individual, allowing the whole person to surface. Encourage people to communicate and form bonds across the company.<br />
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<b>Meaning:</b> Emphasise the positive impact each employee has, along with a bigger purpose that everyone is working towards. She argues that a mission and larger purpose can make even mundane tasks meaningful.<br />
Kanter concludes that “highly engage people who contribute more of themselves can recite Shakeshpere to win customers, weddings in the lobby that create community, or the ultimate prize: innovations that change the world.<br />
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It is time we as managers had a really good look at how we organise and manage staff, and make engagement an embedded factor of organisational life not a side goal to be agonised over annually to meet my KPI’s.<br />
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References:<br />
<a href="http://blogs.hbr.org/2013/10/three-things-that-actually-motivate-employees/">http://blogs.hbr.org/2013/10/three-things-that-actually-motivate-employees/</a><br />
<a href="http://www.gallup.com/strategicconsulting/164735/state-global-workplace.aspx">www.gallup.com/strategicconsulting/164735/state-global-workplace.aspx</a><br />
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David Gwillim<br />
Exploring the value of IT to organisations<br />
email: david.gwillim@optusnet.com.au<br />
blog: http://www.businessitvalue.blogspot.com/David Gwillim, M.Bus(IT Mgmt), B.Ec, CPA, PMP, CSM, CSA(cert)http://www.blogger.com/profile/02046650076395494634noreply@blogger.com0tag:blogger.com,1999:blog-2386023095795582287.post-71478966431577511462013-10-03T16:46:00.001-07:002013-10-03T16:46:18.671-07:00Ownership of IP a big issue for knowledge workersI have recently been involved in a very interesting discussion around ownership of IP in the knowledge economy, is the industrial model of all IP being owned by your organisation appropriate or should a more sharing based model be used? Should Facebook, Google, Woolworth's and other corporations be able to harvest your data and sell it without any compensation to you.<br />
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A relevant article was recently published by Wharton School of Business, <a href="http://knowledge.wharton.upenn.edu/article/felicia-day-creativity-building-business-web/" target="_blank">interview with Felicia Day</a> , it is an interview with Felicia Day, an American actor, writer and producer who got frustrated with Hollywood and pioneered the creation of a "TV like series" on YouTube in 2007 called "The Guild". What is interesting is that she was able to keep IP of the project because she partnered with IT companies who did not have a business model that demanded ownership of content the way the movie industry does. One of the conclusions of the article is that this ability to maintain IP ownership on the web may be fleeting as traditional media production companies move into web production and bring their business models with them.<br />
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If you are interested in more discussion around IP and knowledge workers I can recommend the Linked-in discussion group initiated by a colleague at University of Technology Sydney <a href="http://www.linkedin.com/groups/Building-Organisation-Tomorrow-3225439?home=&gid=3225439&trk=anet_ug_hm" target="_blank">Building the Organisation of Tomorrow</a>.<br />
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<span style="background-color: white; color: #222222; font-family: Arial, Tahoma, Helvetica, FreeSans, sans-serif; font-size: 13px; line-height: 18px;">David Gwillim</span><br style="background-color: white; color: #222222; font-family: Arial, Tahoma, Helvetica, FreeSans, sans-serif; font-size: 13px; line-height: 18px;" /><span style="background-color: white; color: #222222; font-family: Arial, Tahoma, Helvetica, FreeSans, sans-serif; font-size: 13px; line-height: 18px;">Exploring the value of IT to organisations</span><br style="background-color: white; color: #222222; font-family: Arial, Tahoma, Helvetica, FreeSans, sans-serif; font-size: 13px; line-height: 18px;" /><span style="background-color: white; color: #222222; font-family: Arial, Tahoma, Helvetica, FreeSans, sans-serif; font-size: 13px; line-height: 18px;">email: david.gwillim@optusnet.com.au</span><br style="background-color: white; color: #222222; font-family: Arial, Tahoma, Helvetica, FreeSans, sans-serif; font-size: 13px; line-height: 18px;" /><span style="background-color: white; color: #222222; font-family: Arial, Tahoma, Helvetica, FreeSans, sans-serif; font-size: 13px; line-height: 18px;">blog: http://www.businessitvalue.blogspot.com/</span>David Gwillim, M.Bus(IT Mgmt), B.Ec, CPA, PMP, CSM, CSA(cert)http://www.blogger.com/profile/02046650076395494634noreply@blogger.com0tag:blogger.com,1999:blog-2386023095795582287.post-79029566718097291752013-01-10T11:30:00.001-08:002013-01-10T11:30:19.473-08:00The key to employee engagement – allowing your employees to be successful<br />
Over the past 2 decades it has become popular to measure employee engagement. And the results are always the same, senior management declare that employee engagement needs to rise to x% and the Human Resources team will help you develop a plan to ‘engage’ your team which usually involves increasing the number of ‘communications meetings’ as the only actionable questions ever asked in the standard surveys such as Hewitt’s Best Employer survey are around “has your/senior management communicated enough”. This focus on communication, a ‘nice’ working environment or other small changes has always seemed to miss the point to me. In my observations over three decades of management I have seen highly engaged teams who are working in poor environments, working huge hours, who are under paid and who are under constant pressure and stress in rapidly changing and highly uncertain environments. The common thread to the extremely high levels of engagement I have observed in these employees is that “they go home every day feeling that they have achieved something of value” yet this is so often missing from discussion around employee engagement.<br />
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This is the focus of a recent McKinsey Quarterly article by Teresa Amabile and Steven Kramer who phrase engaged employees as those to whom “work has meaning”. Amabile and Kramer’s study focused on how senior executives can destroy meaning for employees and list four key meaning destroyers (they call them ‘traps’):<br />
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1.<span class="Apple-tab-span" style="white-space: pre;"> </span>Mediocrity signals – everyone wants to feel they work for the winning team, however top management can often become focused on ‘me too’ management such as cost cutting and other reactive rear guard strategies that devalue the lofty goals of most strategies and devalues the work that employees are doing to achieve those strategies.<br />
2.<span class="Apple-tab-span" style="white-space: pre;"> </span>Strategic ‘attention deficit disorder’ – Most strategies take many months or years to fully implement and see the benefits from (and the employee satisfaction that comes from achieving those strategies). It is almost impossible to get employees to support a strategic direction when it changes every month or is unclear, again devaluing an employee’s efforts to make a difference.<br />
3.<span class="Apple-tab-span" style="white-space: pre;"> </span>Corporate Keystone cops – displayed through complex reporting structures, empire building, rogue departments, rushed analysis, failure to reward success or enforce accountability and results in organisational chaos (or should that be KAOS).<br />
4.<span class="Apple-tab-span" style="white-space: pre;"> </span>Misbegotten ‘big, hairy, audacious goals’ – in many companies these are so grandiose to be meaningless. BHAG’s only have meaning if employees believe that the BHAG has relevance to the organisation and that senior management truly believe in it and behave accordingly.<br />
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Amabile and Kramer conclude with a series of actions designed to avoid these ‘traps’. I feel the recommendation fall into a bit of a trap themselves but the overall article is excellent and well worth the time to track down and read.<br />
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https://www.mckinseyquarterly.com/Governance/Leadership/How_leaders_kill_meaning_at_work_2910<br />
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David Gwillim<br />
Exploring the value of IT to organisations<br />
email: david.gwillim@optusnet.com.au<br />
blog: http://www.businessitvalue.blogspot.com/<br />
David Gwillim, M.Bus(IT Mgmt), B.Ec, CPA, PMP, CSM, CSA(cert)http://www.blogger.com/profile/02046650076395494634noreply@blogger.com0tag:blogger.com,1999:blog-2386023095795582287.post-4202243405282529502012-04-21T17:24:00.004-07:002012-04-21T17:24:58.132-07:00Collaboration spaces - a new way of working, office design of the future<br />
Collaboration and innovation are popular catch cries in many organisations these days, but how many organisations actually take the time to do more than just talk about it?<br />
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In our industrialised economy there is almost 200 years of managerial processes dedicated to exploiting workers as a ‘pair of hands’, indeed Henry Ford famously remarked "Why when I only want to hire a pair of hands, do I get a whole person?“. The ‘scientific management’ movement that pervades our management thinking and practices today never considered employees as a source of innovation or that employee collaboration should be encouraged.<br />
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While many organisations give lip service to innovation and collaboration very few seem to be making the broad range of changes necessary to make it a reality. As McKinsey’s 7’S model shows organisational change requires a wide a range factors all of which need to be addressed to achieve change. Setting a vision or goal for collaboration is only one part of the change process. Another area that needs to be addressed are the structural changes to where and how employees work, as offices, cubicles and assembly lines were designed for productivity and control over employees not collaboration or independent thought. In recent weeks I have been privileged to view a few examples of how some companies are restructuring the way people work.<br />
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Microsoft Australia has removed many of its offices, cubicles, desks and allocated parking spaces and replaced them with ‘first in’ open working spaces nobody owns, each employee has a locker/trolley for specific documents, devises. To work they choose a seat and plug in. Microsoft claim this has reduced office space needs by 20%, what is of more interest to this blog is that Microsoft found that staff from different departments are sitting together and interacting in ways they never would have before. In considering this observation Microsoft concluded that humans are creatures of habit and that staff in traditional office environments made ‘tracks’ from the car park, though a specific pathway to their desk, kitchen, bathroom and rarely ventured beyond that. The outcome was that staff rarely intermixed beyond their particular department. The changes are quite new but the feedback from Microsoft management is very positive.<br />
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I also visited Google’s Sydney offices, along with the legendary free canteens, play areas and chill out rooms are a host of collaboration spaces. These vary from ‘traditional’ meeting rooms (often with quirks such as the upside-down room where chairs and tables are suspended off the ceiling to provide fun to those video conferencing into the room) to a whole host of informal meeting rooms and meeting spaces resembling a plush bar or cafe. While traditional meeting rooms are ‘booked’ in the usual way, the informal meeting rooms and all other meeting spaces are on a ‘first come basis’. Every meeting room and most meeting spaces come with video conferencing and all have power for device connectivity. There are also groovy single person spaces (with video conferencing of course). The dedication and collaboration of Google staffers is the envy of all other companies, maybe the environment they have created plays its part.<br />
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The Wall Street journal also ran an <a href="http://online.wsj.com/article/SB10001424052702304818404577349783161465976.html" target="_blank">article</a> this week on the trend of unassigned working spaces, while they note companies have been motivated by cost factors they too are discovering the collaboration benefits of these arrangements.<br />
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Paradoxically one of the last bastions of personal cubicles and private spaces seem to be our universities, the very places where innovation and collaboration are supposed to endemic. In the faculty I where I teach part time, each permanent staffer gets their own little lockable office (swinging a cat inside could be a challenge for lower ranking academics), there is a kitchen area and breakout area but it is sterile and uninviting and I never see anyone using it, let alone lounging near-by to chance bumping into others. To add to the sense of isolation the departments of the faculty are spread out across the campus, not only is the opportunity for mixing ‘accidentally’ with other departments in the same faculty limited, the likelihood of informal contact with other faculties is almost non-existent. Of course there are research groups and plenty of meetings but it could be so much more. This could be acceptable if it was not for the call for more cross-discipline research that is considered essential if academia is going to help solve societies biggest dilemmas and contribute positively to human well being. Perhaps re-modelling the university and redefining the meaning of ‘faculty’ would create the environment for true collaboration.<br />
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If collaboration is essential to your business, what are you doing to ensure the environment you create truly supports human interaction?<br />
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David Gwillim<br />
Exploring the value of IT to organisations<br />
email: david.gwillim@optusnet.com.au<br />
blog: http://www.businessitvalue.blogspot.com/<br />David Gwillim, M.Bus(IT Mgmt), B.Ec, CPA, PMP, CSM, CSA(cert)http://www.blogger.com/profile/02046650076395494634noreply@blogger.com0tag:blogger.com,1999:blog-2386023095795582287.post-80789348852141881842012-04-14T04:20:00.000-07:002012-04-14T04:20:22.826-07:00The commoditisation of scale and other technology disruptions<br />
In a recent Harvard Business Review blog Maxwell Wessel wrote a thought provoking piece on the commoditization of ‘scale’. Wessel argues that a major bastion of industrial revolution competitive advantage the ‘economy of scale’, where very large organisations gain advantages in the market due to their large size (scale), effectively creating a barrier to new entrants and smaller players in the market is becoming commoditized and therefore no longer confers competitive advantage due to advances in technology which enable any size of company to access the advantages of scale. He asserts “in today's world, you don't need to have scale to enjoy scale”. For example even micro companies operating out of a residential garage can access the global market over the internet for very small outlay, compared historically with the need for expensive distribution channels a physical presence in each country and expensive advertising to reach the same market. This will radically change the nature of competition in the economy and lead to hyper-specialisation. Wessel’s <a href="http://blogs.hbr.org/cs/2012/03/the_commoditization_of_scale.html?cm_mmc=email-_-newsletter-_-weekly_hotlist-_-hotlist040212&referral=00202&utm_source=newsletter_weekly_hotlist&utm_medium=email&utm_campaign=hotlist040212" target="_blank">blog</a> is well worth reading.<br />
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The commoditisation of scale is just one of many ways emerging technologies are revolutionising businesses and economies, it also illustrates just how disruptive these changes will ultimately be. Technology has already enabled the ‘global supply chain’ with outsourcing to the lowest cost market, the internet has radically changed digital distribution especially audio, print and visual media and 3D printing is set to revolutionise many areas of production to name just a few. It is indeed an exciting time.<br />
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This is leading to many commentators to call for fundamentally new ways of organising and managing businesses, one Australian forum ‘<a href="http://www.linkedin.com/groups/Building-Organisation-Tomorrow-3225439?" target="_blank">Building the Organisation of Tomorrow</a>” on linked-in provides a fascinating forum on the changing nature of organisations. It is well worth monitoring for the latest thinking on organisational change.<br />
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<br /></div>David Gwillim, M.Bus(IT Mgmt), B.Ec, CPA, PMP, CSM, CSA(cert)http://www.blogger.com/profile/02046650076395494634noreply@blogger.com0tag:blogger.com,1999:blog-2386023095795582287.post-40025902680472740672012-03-28T02:17:00.000-07:002012-03-28T02:17:04.912-07:00Should information on the internet be certified for credibility?<br />
Once upon a time IT was a black box managed by introverted magicians who were kept out of sight if not out of mind in the back rooms and cupboards of an organisation. IT is still complex, in many ways it is much more complex than 20 years ago, there is certainly many less ‘user serviceable parts’. Conversely it is also exponentially easier to use, in the way a car is increasingly complex but easier to drive than ever, some even park themselves. My teenage daughters know nothing of the underlying file systems or programming logic that underlies a modern laptop, yet they use the technology and have a relationship with it, that is radically different to my experience of technology. This simplification in the use of IT and the explosion in communications and information it has spawned what has been referred to as the democratisation of information.<br />
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At the same time, experience in the US shows that today’s college students are loosing the ability to critically assess the credibility of information that is presented on the internet. It has been suggested that we may the moving from the information age into the age of miss-information. The internet has provided access to a wealth of information, I am always staggered (and greatly enjoy) what I can find. As most of it is un-curated or moderated I am also very wary of the validity of the information as there is no easy way to assess its credibility. There is a pressing need for a reality check on the information on the internet especially given the plethora of health and wealth advice. Maybe in the not too distant future we will see information ratings agencies springing up giving ratings on the credibility of each site in the same way that ‘made in Australia’ or ‘certified organic’ does today.<br />
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David Gwillim<br />
david.gwillim@optusnet.com.au<br />
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<br /></div>David Gwillim, M.Bus(IT Mgmt), B.Ec, CPA, PMP, CSM, CSA(cert)http://www.blogger.com/profile/02046650076395494634noreply@blogger.com0tag:blogger.com,1999:blog-2386023095795582287.post-16974956781232488702012-03-21T01:51:00.003-07:002012-03-21T01:51:49.767-07:00BYOD computing puts people back into the IT equation<br />
I have been fascinated by the trend towards ‘bring your own computing’ normally staff would be very reticent to provide their own gear instead insisting the company provide it (for cost, repair and support reasons). This is engaging more people than ever in the leading edge of IT innovation and this is a good thing.<br />
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Of course this is also symptomatic of the fact that consumer IT innovation is outstripping corporate IT innovation by a large margin. Once upon a time if you wanted to play with the latest IT toys you needed to join an IT department. Today your lounge room is more It savvy with the iPhone, Twitter, Facebook and gaming consoles leading the IT revolution.<br />
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As far as BYOD in the work place goes there is a precedent, in the early days of ubiquitous mobile phones employees often used their own personal mobile before company policy and corporate thinking recognised the value and essential need for wide distribution of mobile phones in the office (initially they were issued to executives, then senior mangers etc, desktop PC’s had a similar evolution, as iPad’s are today with many boards of directors. I-pads and twitter are slowly making their way into the mainstream office too. The billion dollar question is where will innovation come from next – the corporate or personal world?<br />
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David Gwillim<br />
Exploring the value of IT to organisations<br />
email: david.gwillim@optusnet.com.au<br />
blog: http://www.businessitvalue.blogspot.com/<br />David Gwillim, M.Bus(IT Mgmt), B.Ec, CPA, PMP, CSM, CSA(cert)http://www.blogger.com/profile/02046650076395494634noreply@blogger.com0tag:blogger.com,1999:blog-2386023095795582287.post-15141219849700605652012-03-11T21:55:00.000-07:002012-03-11T21:55:08.698-07:00IT project failure “it’s the people stupid”<br />
I have long contemplated why IT projects and in particular, software projects fail so regularly and seem so hard to do compared to other project based disciplines. There has to be a reason why a bridge or factory (and physical IT infrastructure for that matter) can be built per project plan and be successful but software applications so often fail to live up to expectations. There are a great many lists and case studies that document software project failures and post-mortems on the likely causes and all seem valid and potentially useful. But they are still unsatisfactory in explaining why writing good software applications is so hard.<br />
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It struck me, that the answer is people, and no it’s not the project team, they exist in every project, so do the project sponsors etc. No, it is the fact that application software is dependent on the interaction of individual humans for its use and ultimate success (and arguably its existence). As humans we are a fickle and diverse lot and each of us experiences and interprets our surroundings in our own unique way, this makes designing software a unique challenge.<br />
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While we also experience buildings and bridges individually they have to conform to the physical constraints and characteristics of the materials they are made from, their intended purpose and location. It appears likely that our ‘experience’ of software is somewhat different, it is possible to divorce people from a building, you still have a successful building, software without its intended users is a failure.<br />
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The implications for software project management is that users must be the central feature of the development, while this sounds logical it is not always easy to engage users and in the case of consumer software (such as Apples IOS mobile operating system) it is even considered undesirable to engage users.<br />
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It is significant that modern development methodologies such as Agile emphasise and centralise the involvement of users throughout its iterative approach, there is room for refinement and better ways of doing software development that shift the emphasis from process, project specifications, project risk etc to one centralised on users. The bottom line is, if users fail to engage with the application it has failed.<br />
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David Gwillim<br />
Exploring the value of IT to organisations<br />
email: david.gwillim@optusnet.com.au<br />
blog: http://www.businessitvalue.blogspot.com/<br />David Gwillim, M.Bus(IT Mgmt), B.Ec, CPA, PMP, CSM, CSA(cert)http://www.blogger.com/profile/02046650076395494634noreply@blogger.com0tag:blogger.com,1999:blog-2386023095795582287.post-3262838682720403682012-03-07T01:52:00.001-08:002012-03-07T01:52:34.255-08:00CFO’s predict the role of the CIO will not exist in 5 years<br />
This prediction coming as it does from a survey of CFO’s to whom CIO’s are increasingly reporting is worth a closer look. The survey by IT services company Getronics canvassed 203 UK based CFO’s with 1,000 plus employees.<br />
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Key findings were:<br />
•<span class="Apple-tab-span" style="white-space: pre;"> </span>17% of CFO’s believe the CIO role is in jeopardy<br />
•<span class="Apple-tab-span" style="white-space: pre;"> </span>43% believe IT will merge with finance<br />
•<span class="Apple-tab-span" style="white-space: pre;"> </span>77% of CFO’s had assumed greater responsibility for IT decisions over the past 2-3 years<br />
•<span class="Apple-tab-span" style="white-space: pre;"> </span>50% claimed that lack of integration between finance and IT limited the impact of cost savings achievable from IT projects<br />
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Major drivers cited include the continuing commoditisation of IT services especially cloud and other outsourced services that are now available. Also apparent in the survey was a lack of trust in the IT leadership with 38% of CFO's feeling the CIO does not know enough about finance and 40% feeling the CIO does not know enough about IT!<br />
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For me the findings are more evidence of the growing paradox between the commoditisation and operationalisation of IT within business while at the same time rapid technology change is transforming the global economy and creating the opportunity for new and more effective business models. The survey results suggests that there is a lack of leadership and strategic insight from CIO’s and as a result IT is increasingly being marginalised. Comments such as that of Mark Cook the CEO of Getronics in reflecting on the survey “that only by freeing up CIO’s from the day to day burden of managing assets will organisations be able to truly realise the value that a CIO can bring to their business” ignore the fact that CIO’s have had about 30 years to stake their claim and provide true leadership to the business, most have failed to do so. A new logic for IT management is therefore needed to ensure organisations have the skill to survive and exploit the business environment of the future. The previous one has not worked, its time to try something else.<br />
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The Getronics report can be accessed at <a href="http://getronics-uk.com/knowledge-share/news-and-events/changingcfo.php">http://getronics-uk.com/knowledge-share/news-and-events/changingcfo.php</a><br />
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David Gwillim<br />
Exploring the value of IT to organisations<br />
email: david.gwillim@optusnet.com.au<br />
blog: http://www.businessitvalue.blogspot.com/<br />David Gwillim, M.Bus(IT Mgmt), B.Ec, CPA, PMP, CSM, CSA(cert)http://www.blogger.com/profile/02046650076395494634noreply@blogger.com0tag:blogger.com,1999:blog-2386023095795582287.post-78488316814812914512012-02-26T17:49:00.000-08:002012-02-26T17:49:08.696-08:00Big data - requires cultural changes for success<br />
Much has been written lately about ‘big data’ being the next big thing in business. There is no doubt that the explosion in data being collected by organisations opens opportunities for exploitation, especially if you can exploit it quicker than your competitors. However just deciding to trap and analyse 100 terabytes of data does not make an organisation expert at ‘big data’ or guarantee any competitive insight will result. In many companies the only real experience with large quantities of data and its use is through the finance team. The problem with the accountants is that they treat data in a ritualistic way (remember the comedy sketches of accountants making sacrifices to the god of balanced books?) so that vast quantities of the data they tend has little relevance to the organisation. To a lesser extent marketing also use data extensively though often those number are externally summarised so the nitty gritty of data management is avoided. Also most people are very weary of data and statistics, the political misuse of statistics has a lot to answer for.<br />
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All of this means that without considerable effort an organisational initiative to hop on the “big data” bandwagon is doomed to failure. Having spent 6 years of my life championing data management and analysis in a large multinational organisation here are a few suggestions to improve the chance of any ‘big data’ project:<br />
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1.<span class="Apple-tab-span" style="white-space: pre;"> </span>Reverence for data – everything else in this list really reinforces this point. Data needs to be taken seriously to be effective. Discounting it should not be done lightly and there should be good reasons for ignoring data.<br />
2.<span class="Apple-tab-span" style="white-space: pre;"> </span>Culture of data accuracy – “garbage in - garbage out” is as relevant today as it ever was. Big data will only ever be useful when everyone involved in its collection puts a priority on it and is fastidiousness in ensuring quality, accuracy and timeliness of data inputs.<br />
3.<span class="Apple-tab-span" style="white-space: pre;"> </span>Trust the data – many a plane has crashed because the pilot decided that the instruments were wrong and they knew better. Once the systems have been set up and data validated it should be believed, nothing erodes the value of data quicker than discounting it because it tells us something we don’t want to believe.<br />
4.<span class="Apple-tab-span" style="white-space: pre;"> </span>Don’t shoot the messenger – when profit is sinking do you blame the finance team for recording such poor results? Data is often used as a scapegoat when times are tough, it is nothing more than a tool.<br />
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Effective use of data therefore, is dependent on a positive organisational ‘mind set’ towards the value that the data can bring. All the latest analytic tools, consultants and trends will not mean a thing, indeed will be a big waste of money unless the organisation is willing to change its mindset and accept the value of data.<br />
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<i>David Gwillim</i><br />
<i>Exploring the value of IT to organisations</i><br />
<i>email: david.gwillim@optusnet.com.au</i><br />
<i>blog: http://www.businessitvalue.blogspot.com/</i><br />David Gwillim, M.Bus(IT Mgmt), B.Ec, CPA, PMP, CSM, CSA(cert)http://www.blogger.com/profile/02046650076395494634noreply@blogger.com0tag:blogger.com,1999:blog-2386023095795582287.post-51552119791938101112012-02-21T13:29:00.000-08:002012-02-21T13:29:11.717-08:00Knowledge is power and the fallacy of open communication<br />
Being a keen observer of managerial behaviour I have always been perplexed by the paradox displayed by many managers when it comes to open communication. Most managers want their staff to be open in their communication with a “no surprises” policy but actively vet and manage any information they provide to their superiors who inevitably demand the same open information. I have even dealt with a CEO who rabidly demanded open information from his team then furiously controlled and manipulated the information he provided to the board of directors.<br />
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I often wondered how the managers in question thought this behaviour was reasonable, after all it is not exactly leading by example is it?<br />
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Of course seen through the lens of power and politics this behaviour makes perfect sense, information asymmetry is very powerful, our market economy and all political systems are built on this principle.<br />
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But is it leadership and will it stand up to the challenges of a networked economy? The answer is probably yes, even where a leader shares openly with their team, the team can develop an information advantage over other teams through information asymmetry. I am still uncomfortable with this idea though, how does it reconcile to leadership quotes such as the following Chinese Proverb “not the cry, but the flight of the wild duck, leads the flock to fly and follow”?<br />
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<i>David Gwillim</i><br />
<i>Exploring the value of IT to organisations</i><br />
<i>email: david.gwillim@optusnet.com.au</i><br />
<a href="http://www.businessitvalue.blogspot.com/"><i>blog: http://www.businessitvalue.blogspot.com/</i></a><br />David Gwillim, M.Bus(IT Mgmt), B.Ec, CPA, PMP, CSM, CSA(cert)http://www.blogger.com/profile/02046650076395494634noreply@blogger.com0tag:blogger.com,1999:blog-2386023095795582287.post-78862781904313736652012-02-12T18:17:00.000-08:002012-02-12T18:17:59.846-08:00CIO’s – Who do you report to? Does it matter?<br />
The CIO industry press often states that who you report to does not matter and that it is possible to lead and be innovative from any reporting line within a company. The evidence suggests otherwise. My own research <a href="http://businessitvalue.blogspot.com.au/2011/11/is-your-it-team-strategic-or.html">http://businessitvalue.blogspot.com.au/2011/11/is-your-it-team-strategic-or.html</a> shows that organisations that use IT strategically always have the CIO reporting in to the CEO or is a member of the executive team. The current trend of shifting the CIO under Finance in many organisations indicates a view that IT is not strategic but operational and a cost to be minimised.<br />
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New research published this week by Price Waterhouse Coopers (PWC) adds to the evidence that reporting and organisational structure is important and does determine the role and effectiveness of IT in the organisation. They found that high performing organisations (25% of the 489 surveyed organisations) were twice as likely to have the CIO reporting to the CEO than other organisations, indeed they considered this essential to the effective use of technology. In these organisations IT regularly delivered on business needs.<br />
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They conclude that “unlike the predictions of some pundits who say IT is commoditizing, we see that those IT organisations that can effectively serve both their customers and their firm, deliver projects on time and on budget, and distil mountains of bits into meaningful insights are as rare as ever. In this way IT’s ability to drive business value is becoming more – not less – differentiated.”<br />
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With the rapid changes in technology, and even more rapid changes in technology use (think social, global, individual) the opportunities to gain competitive advantage from innovative use of IT has never been greater, for organisations willing to integrate technology into their strategy and recognise the CIO’s pivotal role in helping the organisation through the reporting structure the potential rewards are immense. Who do you report to?<br />
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The PWC report can be accessed at:<br />
<a href="http://www.pwc.com/us/en/advisory/2011-digital-iq-survey/index.jhtml">http://www.pwc.com/us/en/advisory/2011-digital-iq-survey/index.jhtml</a><br />
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<i>David Gwillim</i><br />
<i>Exploring the value of IT to organisations</i><br />
<i>email: david.gwillim@optusnet.com.au</i><br />
<i>blog: http://www.businessitvalue.blogspot.com/</i>David Gwillim, M.Bus(IT Mgmt), B.Ec, CPA, PMP, CSM, CSA(cert)http://www.blogger.com/profile/02046650076395494634noreply@blogger.com0tag:blogger.com,1999:blog-2386023095795582287.post-86977503952637389932012-02-05T20:51:00.000-08:002012-02-05T20:51:08.332-08:00Are standards destroying IT governance?<br />
Fundamentally, governance is “the exercise of authority” (Dictionary.com), this is operationalised as who can make what decisions, also called ‘decision rights’. Through the allocation of ‘decision rights’ the directors/owners of a company exercise control (to the degree that they choose to) over an organisation (corporate governance). IT governance is essentially the same (being a subset of corporate governance) with a focus on the IT assets of the company.<br />
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Governance applies (with differing decision rights patterns) regardless of the organisational structure or objective. Governance exists in an organisation regardless of whether it is a tightly controlled, highly centralised company, a large bureaucracy or a loose alliance of semi-independent actors. Why then is governance and IT governance in particular considered a stifler of innovation, agility and new forms of organisation?<br />
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Perhaps it is because those on the IT governance gravy train have found value in systemising governance and IT governance in particular into a series of standards, processes and methodologies which an organisation ‘has to have’ to have good governance. ISO 38500 “Corporate Governance of Information Technology” was issued in 2010 based on the world’s first IT Governance standard AS8015 issued by Standards Australia in 2005. It contains six general principles for IT Governance which are intended as guide for organisations of decisions to consider. This however has become an umbrella standard and IT Governance has become (according to the influential IT Governance UK organisation) defined under the Calder-Moir framework as consisting of 6 exhaustive ISO standards and no less than 25 complex frameworks and methodologies. Just one of these frameworks is CoBIT which alone has over 300 ‘control points’ in order to manage an IT system. If implemented in its entirety the Calder-Moir framework would bury an organisation under a weight of process and policy that it would never recover from. No wonder managers and employees have negative views of IT governance.<br />
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It is time to return to the fundamentals of IT governance, not just to revive the efficiency of today’s organisations but so that it can play its rightful place in emerging forms of organisation that seek to avoid the bureaucratic and sole destroying impost of traditional command and control organisations. Governance is not the enemy.<br />
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<i style="font-family: Arial, Tahoma, Helvetica, FreeSans, sans-serif; font-size: 13px;">blog: </i><i style="background-color: white;"><span style="color: #1f497d;"><a href="http://www.businessitvalue.blogspot.com/"><span style="font-family: Arial, Helvetica, sans-serif; font-size: x-small;">http://www.businessitvalue.blogspot.com/</span></a></span></i></div>David Gwillim, M.Bus(IT Mgmt), B.Ec, CPA, PMP, CSM, CSA(cert)http://www.blogger.com/profile/02046650076395494634noreply@blogger.com0tag:blogger.com,1999:blog-2386023095795582287.post-5149206293038942332012-01-30T15:04:00.000-08:002012-01-30T15:04:24.270-08:00What would you advise someone who is starting their career in IT in 2013?<br />
One of my assignments this year is to assist final year IT students at the University of Technology to prepare for a career in IT. It will include resume writing and interview techniques etc, but what are their career prospects?<br />
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Careers in IT in Australia have changed rapidly in the past decade, the opportunity to work in a hardcore research or software development company have always been small (some like Atlassian, Wisetech and Canon’s CISRA provide career options), however the traditional IT organisation within non-IT businesses are facing the paradox of IT becoming infinitely more complex while being easier than ever to install and use allowing other business divisions to by-pass the internal IT department entirely, leading to considerable downsizing. Outsourcing (including cloud services) has greatly simplified the IT challenge within many organisations. There is currently an opportunity for a career in Australian IT services companies, this area has enjoyed rapid growth in recent years, however once organisations get comfortable with outsourcing, third party management and off-site storage of their data, the next logical step is to move it all offshore to the lowest cost provider, impacting Australian IT careers.<br />
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The greatest opportunity I see for today’s IT graduates is to identify a better application, system, process, web design, iPhone app, game etc and build their own business around it. The opportunities for IT entrepreneurs have never been greater, with the rapid pace of technology development the opportunity to leverage technology in new ways is vast. Those graduating today are ‘digital natives’ with an insight into IT and a relationship with technology that us old-timers cannot even imagine. The opportunities are endless and very exciting, today’s IT graduates can shape not only the future of IT but the world.<br />
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What would you say to today's IT graduates?<br />
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<br /></div>David Gwillim, M.Bus(IT Mgmt), B.Ec, CPA, PMP, CSM, CSA(cert)http://www.blogger.com/profile/02046650076395494634noreply@blogger.com0tag:blogger.com,1999:blog-2386023095795582287.post-26312588765032254422011-12-19T01:14:00.000-08:002011-12-19T18:46:29.428-08:00Santa Claus's key performance indicatorsSanta Claus has the ultimate in seasonal businesses, in just one night he has to deliver the right toys to the right children to over 1.675 billion houses (based on an average of 4 occupants per house <span style="font-family: inherit;">www.convert-to.com</span>). So what performance metrics would Santa require? There are the obvious ones on Christmas Eve, such as the need visit 19,386 homes per second, with the sleigh travelling at an estimated 3,000 times the speed of sound <span style="background-color: white;"><span style="font-family: inherit;">(</span><span style="color: #222222;"><span style="font-family: inherit;"><span style="line-height: 23px;">http://www.baltimoremd.com/humor/santaengineer.html). And the avoidance of rework, if the wrong present is delivered to a child. But what about other measures?</span></span></span></span><br />
<span style="background-color: white;"><span style="color: #222222;"><span style="font-family: inherit;"><span style="line-height: 23px;"><br /></span></span></span></span><br />
<span style="background-color: white;"><span style="color: #222222;"><span style="font-family: inherit;"><span style="line-height: 23px;">When I posed this question at a recent Christmas Party my fellow party-goers suggested the amount of </span></span><span style="line-height: 23px;">alcohol Santa consumers over the evening could be a problem. Based on 30ml of alcoholic spirits such as whisky or gin left out at every 5th house Santa consumes roughly 10,000 litres of spirits on Christmas Eve! However the energy required to visit 19,386 homes per second probably requires that sort of energy input, indeed Santa may budget for a particular amount of drink and food being left out to keep himself and the reindeer fuelled up, with a disaster recovery plan at hand should the planned food and drink not be available.</span></span></span><br />
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Of course the ultimate measure of success for Santa is as many happy smiling children as possible. Santa's marketing department has the triple role of promoting the Santa brand, determining who gets what presents (what to produce) and also who is naughty and who is nice, hence the year-wide viral marketing campaign using parents to cajole there little darlings into behaving with the threat that if they do not behave they will be put on the naughty list and Santa will not visit them. Of course I trust that you have been good during the year and Santa will be visiting your house on Christmas Eve.<br />
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This blog will be having a short break over Christmas, back late January. If there is anything you would like to the blog to cover in 2012 let me know, it is sure to be a fabulous year. I wish you a happy and safe Christmas.<br />
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<i>Exploring the value of IT to organisations<o:p></o:p></i></div>
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<i>email: david.gwillim@optusnet.com.au</i></div>
<i style="font-family: Arial, Tahoma, Helvetica, FreeSans, sans-serif; font-size: 13px;">blog: </i><i style="background-color: white;"><span style="color: #1f497d;"><a href="http://www.businessitvalue.blogspot.com/"><span style="font-family: Arial, Helvetica, sans-serif; font-size: x-small;">http://www.businessitvalue.blogspot.com/</span></a></span></i></div>David Gwillim, M.Bus(IT Mgmt), B.Ec, CPA, PMP, CSM, CSA(cert)http://www.blogger.com/profile/02046650076395494634noreply@blogger.com0tag:blogger.com,1999:blog-2386023095795582287.post-39894608244538486322011-12-14T02:37:00.000-08:002011-12-14T02:37:50.416-08:00Forget IT strategy, it is now all about digital strategyThere has been a quiet revolution going on in organisations over the past decade which has gathered pace this year. Organisational IT is changing beyond recognition. With the widespread use of outsourcing, off-shoring, cloud services (application outsourcing), remote hosting and the rapidly developing automated economy, not to mention the rise of user owned devices and the shifting of IT purchasing and management power out of IT enclaves and into general business, the world of IT strategy is not what it used to be. Indeed organisations still thinking of IT as something to be aligned (proof if ever there was any needed of the 'otherness' of IT are just kidding themselves).<br />
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It is now, all about your digital strategy, that is, how will you electronically interconnect and interact with customers, suppliers, employees, government etc. The 'how' of IT is rightly taking a back-seat to the 'what - where - when'. Atlast organisational IT is maturing, it is an area of strategy every manager must now know, and it is as impossible to separate form the activity of business as finance or marketing is.<br />
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This is causing major challenges for IT managers and those living in the IT-Business alignment past. It is also a challenge for business schools and others charged with equipping tomorrows managers with the tools they need to lead tomorrows organisations. I have spent my entire career in IT and acknowledge the legacy thinking that I possess. I hope that I can embrace and contribute to the new world of digital strategy, it will be fast and exciting, and organisational IT will never be the same again. 2012 here we come.<br />
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<i>Exploring the value of IT to organisations<o:p></o:p></i></div>
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<i>email: david.gwillim@optusnet.com.au</i></div>David Gwillim, M.Bus(IT Mgmt), B.Ec, CPA, PMP, CSM, CSA(cert)http://www.blogger.com/profile/02046650076395494634noreply@blogger.com0tag:blogger.com,1999:blog-2386023095795582287.post-55106362236275515102011-12-04T15:00:00.001-08:002011-12-04T16:23:27.701-08:00Fire all the managers - a measurement solutionThe development of bureaucratic management over the past 200 years has built up a whole heap of metrics, budgets, planning and other evaluative mechanisms designed to enhance performance within a functional hierarchy. A key question for me, when I read about alternative business models is how are the measurement and evaluation systems adapted so that desired behaviour is achieved in the new model. After all you get what you measure, and many a business change has failed because the measurement and reward system did not change or was not appropriate. After all you get what you measure?<br />
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"First, let's fire all the managers" is the title of management guru Gary Hamel's latest article in Harvard Business Review (citation below). It documents the practices of the Morning Star Company in California that operates 3 major fruit processing plants and is the worlds largest processor of tomatoes. With 400 staff and $700M in revenue such a company would typically have a hierarchy of 50 or so managers. At Morning Star no one has a boss, employees negotiate with their peers, everyone can spend the company's money, each individual is responsible for acquiring the tools they need, there are no titles or promotions and compensation decisions are peer based. Morning Stars vision is to create a company in which all team members "will be self managing professionals, initiating communications and the coordination of their activities with fellow colleagues, customers, suppliers, and fellow industry participants, absent directives from others".<br />
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Effective measurement systems are the corner stone of alternatives to the traditional control centric bureaucratic hierarchy. So how does measurement work at Morning Star? For a start employees negotiate with each other over the services and performance levels they will provide to each other. This is similar to internal SLA's that are familiar to many IT managers, the main difference from an IT perspective is that they are reciprocal rather than the typical one-sided internal IT SLA. Morning Star calls these agreements "Colleague Letter of Understanding" and there are 3,000 of them across the company.<br />
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Secondly, separate P&L's are created for as many business segments as possible (this is critical in empowering employees so they can determine their contribution to the companies overall results and modify behaviour as necessary - in large and complex business units typical in many big companies it is impossible for individuals to quantify their contribution - and therefore cannot make empowered decisions that are consistent with overall company success) at Morning Star there are 23 separate business units with P&Ls.<br />
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Also every staff member creates a personal vision statement that shows how they contribute to the company's overall vision. This seems to me to allow much for more flexibility than the balanced scorecard when it is applied to individuals as due to its format restrictions the individual scorecard often make no sense.<br />
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It is fascinating to watch organisations such as Morning Star, Google, WL Gore and others developing alternative management models, with common themes of individual responsibility and team based measurement, I'm sure more will develop in the knowledge economy. To read this article go to hbr.org and register for free, you can download 3 articles per month at no cost. Hamel, G, 2011, "First Lets Fire All the Managers", Harvard Business Review, December 2011.<br />
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<i>Exploring the value of IT to organisations<o:p></o:p></i></div>
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<br />David Gwillim, M.Bus(IT Mgmt), B.Ec, CPA, PMP, CSM, CSA(cert)http://www.blogger.com/profile/02046650076395494634noreply@blogger.com0tag:blogger.com,1999:blog-2386023095795582287.post-38942424932482492572011-11-28T16:10:00.001-08:002011-11-28T16:30:00.285-08:00The widening gap between companies that use IT strategically and those that don'tThe first mention I saw about a growing gap between companies that 'get' IT and use it effectively and those that don't was in research published by Meta Group (now part of Gartner) in 2004. They predicted that there would be an increasing gap between internal IT organisations that were strategic in their orientation and those that were operational. They predicted that those that were operationally focused would find themselves outsourced, downsized and had they know then - replaced by cloud applications.<br />
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There is plenty of evidence that Meta Group were right. A study published late last year by Accenture titled "Mind The Gap: Insights from Accenture's Third Global IT Performance Study" covering 225 of the worlds largest companies concluded that the gap in performance of IT in high performing organisations was 42% in terms of innovation and 37% for execution. Accenture identified 9 areas that high performing IT organisations excelled at:<br />
1. Strategic IT alignment<br />
2. Effective IT Governance and clear strategic business cases for all IT investments<br />
3. Clear application architecture<br />
4. Focus on information management not technology<br />
5. Implemented a standarised platform and service management approach such as ITIL<br />
6. Effective solution delivery and highly visible project performance<br />
7. Effective workforce management<br />
8. Effective and proactive IT security strategy<br />
9. Intelligent use of outsourcing to access hard to get skill sets and agility<br />
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The question as a CIO then, is what do you do if your IT organisation is not viewed as strategic? Is it possible to change thaose perceptions or is a change of employer required?<br />
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Also look out for my article in the current issue of CIO Magazine on the challenges for the CIO of the future (Sept-Oct p. 80-81).David Gwillim, M.Bus(IT Mgmt), B.Ec, CPA, PMP, CSM, CSA(cert)http://www.blogger.com/profile/02046650076395494634noreply@blogger.com0tag:blogger.com,1999:blog-2386023095795582287.post-20024274764351216642011-11-21T00:48:00.001-08:002011-11-21T01:25:51.318-08:00Strategic use of IT - ComputershareContinuing with the theme of operational versus strategic IT investment, this week is a brief look at Computershare, an Australian company that started life providing third party share registry services to Australian listed companies. The company has expanded both internationally and into complementary high volume services such as handling parking fines and administration of rental bonds. It has increased revenues 36% over the past 5 years and profit by 106% and employs 11,000 staff in 20 countries. It really is a great Australian success story.<br />
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It's relevance to this blog is that Computershare has used and developed its IT platform extensively to continually automate its processes and services. In short its IT capability forms an integral part of the company's sustainable competitive advantage. Using the analysis developed in this blog over the past few weeks Computershare stands out on some key criteria:<br />
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1. The board of directors and senior management take an active interest in IT strategy and spending (none of this reporting via the CFO)<br />
2. IT spending averages 10% of revenue (9.9% in 2011), significantly higher than the 2.2% average for operationally focused IT operations<br />
3. Portfolio management underpins all IT investment decisions<br />
4. The strategic importance of IT is recognised by the board and senior management - it even gets a mention in the annual report to shareholders.<br />
5. R&D makes up 41% of the IT budget compared to industry average of 30%<br />
6. Contractors and outsourced IT is mininimal, 95% of IT manpower is in-house allowing critical knowledge to be developed and protected.<br />
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So should you race out and spend 10% of your annual revenue on IT? Well that depends on whether IT is part of your competitive advantage or not. What Computershare illustrates is that IT investment and management should be a series of deliberate decisions consistent with its place in an organisation. Cutting IT costs while claiming IT should be strategic is just plain fantasy, bad management or both.David Gwillim, M.Bus(IT Mgmt), B.Ec, CPA, PMP, CSM, CSA(cert)http://www.blogger.com/profile/02046650076395494634noreply@blogger.com0tag:blogger.com,1999:blog-2386023095795582287.post-72822628544238599032011-11-06T18:56:00.000-08:002011-11-06T18:56:06.408-08:00Is your IT team strategic or operational?"Do not expect value from a CIO with an operational profile" proclaims KPMG in their report "Cost to Value 2010 Global Survey on the CIO Agenda", but how do you determine what "operational" is?<br />
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Last week I provided a simple survey to determine if your IT team has a primarily operational or strategic focus. Of the 15 criteria listed there are 5 criteria that have stood out in my research to-date as being diagnostic, that is companies with a strategic focus almost always have these traits and those that are operational almost never do. The 5 criteria are:<br />
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<b>1. Who does the CIO report to?:</b> CIO's that have a reporting line into the CEO or top executives are 70% likely to be strategically orientated. CIO's who report to the CFO or COO are never strategically orientated. This makes sense, if IT is strategic to the business then the CEO wants to be involved, if it is something that should be neither seen nor hear (nor ever break) then it goes to the CFO. Many CIO's seem to forget this and think they can be strategic for behind the CFO, the results suggest otherwise.<br />
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<b>2. Are portfolio management techniques used to manage IT investment?:</b> This one surprised me. In 99% of companies with a strategic orientation portfolio management was in use, in operationally focused IT teams it was 11%.<br />
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<b>3. When IT investments are being considered what are the key criteria for approval?:</b> 98% of companies with a strategic IT orientation focus on strategic fit, while only 23% for companies with a operational focus.<br />
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<b>4. Are IT benefits managed?:</b> For companies with a strategic IT focus 70% actively manage benefits, for operational IT that percentage drops to 0%!<br />
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<b>5. Is the CIO focused on value delivery or cost cutting?:</b> 85% of strategically focused CIOs focus on value while only 22% of operational focused companies do.<br />
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So what does this all mean? Well, it has significant influence on what the CIO can achieve in a organisation and it also provides a guide as to what the CIO should be focusing on to align with how IT is truly viewed by the executives.<br />
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There will be no blog next week, back on the 21st of November.David Gwillim, M.Bus(IT Mgmt), B.Ec, CPA, PMP, CSM, CSA(cert)http://www.blogger.com/profile/02046650076395494634noreply@blogger.com0tag:blogger.com,1999:blog-2386023095795582287.post-9932649304993464452011-10-31T16:23:00.000-07:002011-10-31T16:23:58.707-07:00Strategic IT versus operational IT, how do you tell the difference?<br />
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Is your IT team
strategic or just keeping the lights on? How would you know? Over the past few years I have been undertaking some
research into the role of the IT team within a company. In short, is
the IT teams role predominantly strategic (rare) or focused on operations
(common)? Many CIO’s consider themselves ‘strategic’ when
the rest of the company considers them ‘operational’ and wonder why they feel
frustrated and not taken seriously by other managers. Understanding whether IT is strategic or operational in an organisation is the first step delivering better IT services.</div>
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To determine whether your IT operation is strategic or
operational it is necessary to look at the ‘actual behaviour’ and position of IT in the organisation not the stated strategies or objectives. </div>
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Take the following quiz to determine the primary orientation of your
IT group. Answer each question as either column A or column B, depending on
which answer applies the most:</div>
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<a href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEji-oCViJkYGiodDconiBxT0RCdDla_5tXlOkSDkN12xpADEHRdiisL9cARqBVpevBYpMEatYK_7gTZCvnXROKlSfGNBhEvFQWgmrJPDWQ50xujDAcg0Pz4vuHLwiBQ3rxSdQczLWt1s4c8/s1600/ITG+questionnaire.jpg" imageanchor="1" style="margin-left: 1em; margin-right: 1em;"><img border="0" height="365" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEji-oCViJkYGiodDconiBxT0RCdDla_5tXlOkSDkN12xpADEHRdiisL9cARqBVpevBYpMEatYK_7gTZCvnXROKlSfGNBhEvFQWgmrJPDWQ50xujDAcg0Pz4vuHLwiBQ3rxSdQczLWt1s4c8/s400/ITG+questionnaire.jpg" width="400" /></a></div>
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Count the number of scores for column A and column B. If you answered predominantly A scores then IT has a strategic orientation, if the answer if mostly B scores then IT is operational. The implications of this will be discussed next week as it has a huge impact on the value that the IT team can deliver to the organisation.</div>David Gwillim, M.Bus(IT Mgmt), B.Ec, CPA, PMP, CSM, CSA(cert)http://www.blogger.com/profile/02046650076395494634noreply@blogger.com0tag:blogger.com,1999:blog-2386023095795582287.post-81036391206849651942011-10-24T03:04:00.000-07:002011-10-24T03:04:27.505-07:00Canny homeworkers 'out source' workI had a fascinating discussion with someone today whose friend is a contract programmer. The friend works from home and where possible sends the work he has offshore to be done, then checks it and uploads it per his contract. Apparently he gets the work done for 30% of his hourly rate so make 60% without doing any work. While sub-contracting is common in production programming, it is not common (or probably expected) in personal contracting.<br />
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This raised the question in my mind as to whether home workers (employees) will get in on this and start outsourcing their work to cheaper providers. If you think this is unlikely check out this site that writes academic essays for you (for a fee), the extension of these types of services to doing my job for me is not that hard to imagine. <a href="http://www.assignmentmakers.com/Default.aspx" target="_blank">http://www.assignmentmakers.com/Default.aspx</a><br />
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The question that this raises, is how can this happen and how will it be managed in the future? My thesis is that our relationships to work/study is becoming more remote. Historically workers were apprenticed and students met lecturers face to face, therefore it was difficult (not impossible) to fake personal effort. With the coming of the internet the relationship between employee/boss and lecturer/teacher are becoming more and more remote. It will be interesting to see what social system develops to control this. For example contract law developed in England in the 19th century in response to mass production and imports from overseas that broke the traditionally strong relationship between grower/manufacturer and consumer, necessitating a code of conduct (common law contracts) to ensure fair behaviour (as the traditional 'relationship controls' no longer worked). What do you think?<br />
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<span style="color: black;"><o:p></o:p></span></div>David Gwillim, M.Bus(IT Mgmt), B.Ec, CPA, PMP, CSM, CSA(cert)http://www.blogger.com/profile/02046650076395494634noreply@blogger.com0