This is really a thought paper on the structure of IT departments going forward. It poses more questions than answers but I do feel that change is needed and as always thoughts precede action!
Generally we seem to be stuck in a time warp with how we structure IT departments. We sometimes see discussion on how we should be aligning to the business and how IT services should change; we sometimes get companies partially going down those routes by placing IT people in the business and creating new roles but more than not, we seem to drift back into the traditional structure.
When I say traditional structure, I am talking about an IT department headed by a CIO/IT Director and divided into functional teams headed by a manager.
Although I have nearly always operated the traditional model I have over the years become more uncomfortable with it because it somehow doesn’t seem to match the business needs and although I have made some adjustments, it still seems to drift back to the traditional model and become top heavy and expensive. So is there an answer?
If we attempt change but eventually seem to end up with a very similar solution to where we came from does this suggests the traditional model is OK or do we need more fundamental change.
One question is why do we go back to what I am calling the traditional model? Is it because:-
- It is what IT people know best and therefore it feels comfortable
- It retains the barrier with the business where people don’t feel comfortable outside the technology world
- It creates the hierarchy where people can aspire to become team leaders and managers regardless of business need
- Structures are often built to resolve people issues rather than the business need
The other question is why would we want fundamental change? Here are some thoughts:-
- The costs of running IT are still too high
- The hierarchical model can stifle or block innovation and sometimes motivation
- The speed of response to business change is slow
- Business alignment and understanding is poor
- IT Direction versus Business needs don’t always match
- Business managers are now more IT literate than ever before
What would a fundamental change look like and what sort of questions should we ask ourselves in order to define it?
- Do we need a CIO/IT Director and if not how do we co-ordinate direction? Could the IT Director be part time or supplied as part of a service?
- Would it be better to have a Chief Process Officer or Business Transformation Director on the board and aligned to the business units?
- How do we access the IT skills required by the business? Should we look at a shared service model, a strategic alignment with a supplier to supply skills on an ‘as needed’ basis?
- Do we need a Hierarchy? Do we need someone in charge at every level? Can we control chaos? Can we avoid the Peter Principle? (Where someone gets promoted beyond their capability. Nothing to do with me - honest!), will people blossom if no promotion levels just experience levels? Should we put IT staff within the business and buy resources when we need them?
- How can we help the performance of the business and not hinder it? How can we make IT more adaptable to changes in the business?
- Is retention of knowledge within the IT arena important or if documented properly can someone else pick it up?
All this adds up to a lean IT function more aligned to the business with only essential skills retained within the organisation and other skills acquired on an as needs basis. Those in house skills would report within the business units. A new role of Chief Process Officer or Business Transformation Director reporting to the CEO and working with the business units to drive aligned business change. The business units would dictate the direction and the projects and bear the IT costs within their units based on clearly defined and deliverable benefits. An optional on demand IT Director would be used a bit like a non-exec to ensure compliance and direction were in line with current thinking.
That’s my starter for 10. Will be interesting to see if we get any other views to add to the debate!