Culture Shows Up Again as the Thing Driving Agility

Forbes Insights and the Scrum Alliance have got together to publish a recent report on Organisational Agility, drawn from interviews with over 1,000 C-suite executives from around the globe.

A key theme which runs through the whole report is how important Culture is to Organisational Agility. (Something which I emphasised in "The Way of DAU"). Additionally, there are some compelling findings about the benefits of organisational agility. Over 50% of respondents identified benefits in the areas of:

• Time to Market
• Speed of Innovation
• Employee Morale
• Ability to Attract Talent
• Competitiveness
• Financial Results
• Ability to Manage Across Geographies

To re-inforce these findings, the report focuses on the performance of leading Agile Organisations and Laggard Organisations. Whilst they represent similar proportions of the overall survey population (16% and 19% respectively), twice as many Leader Organisations enjoy annual growth of over 20% as Laggards do.

In all probability, the CxO community that the authors consulted, probably included a pool of organisation most interested in Agility, as an earlier report by McKinsey suggested that only 4% of organisations have completed an organisation wide Agile transformation.

The report looked at a number of things, including whether organisational agility was End-to-End or siloed in functions. Based on the opinions of the respondents, it appears that Operations and Technical Functions tend to be the most Agile (79% and 75% respectively), followed by the usual suspects in Sales and Marketing. Interestingly enough, Finance achieved a credible 64% vote of confidence, but HR was amongst the laggards with only 56% of respondents considering it an agile function. Considering that HR is often thought of as the "Guardian of Culture" this is a worrying gulf and should be a wake up call to HR to re-vitalise its mission.

One area that I would have liked more analysis on, was whether Leading Agile organisations already had positive innovative and collaborative cultures before they embraced Agile or had to focus on it as part of Agile Adoption.

Anyway, the take away is that all CxOs, irrespective of function, need to work on fostering the right culture.

IT and Digital's New World Order

A common theme in many IT departments or functions is the "Them and Us" relationship with the rest of "The Business". Miles of column print are given in IT publications and by analysts on emotional hand wringing about the lack of connection with colleagues in the business and multiple surveys examine the CIO's role and status in the business as well as his or her relationship with the CEO.

Recently, however, the press has been distracted by the idea of automation and everyone being replaced by AI based automation and the supposed death of many jobs, without actually bothering to analyse the capability of AI tools. the fact is that they are both powerful and limited at the same time and it takes an aweful lot of training to get some quite basic capability out of a machine learning application. Anyone who has used Alexa (Amazon's voice based AI agent for automating your home, answering general knowledge questions and playing music) knows that you can be both delighted and frustrated by her abilities to do what you want or to get it so completely wrong that you wring your hands in despair.

In reality the things having the most impact in the UK are Brexit (because it is used as a general excuse for not making decisions and refusing to hire new staff) and the impact of XaaS and Lean. These are gradually evolving the way in which products are developed and IT works both within itself and with other people in the wider business. It's no longer appropriate to organise IT around functional siloes and gatekeeper roles, which slow down progress and frustrate our business colleagues. The move to end-to-end product teams and more integrative roles means that IT needs to shift its mentality from reclusive castle dwellers to engaged collaborators, as IT becomes a fundamental part of business operations. The rest of the business has to do this too. Because, when you look at it, most other functions suffer similar problems of angst and feelings of under appreciation.

The most difficult part of the evolving role, is how does IT relate to Business Operations once this transition has been made and IT is properly organised to align and integrate with Operations. This means that many traditional assumptions around how to implement ITIL, organise testing or approach enterprise architecture (for example) need to be revisited. People in IT need to move towards taking more interest in the business and its customers, as well as what a collaborative culture looks like. It also means that CIOs need to become more assertive (not aggressive) in engaging with their peers to understand and agree business priorities, as well as partnering internally and externally to move quicker to address urgent needs. Old ideas like "boiling the ocean" with monolithic technology change initiatives need to go. Smaller, quicker steps and daring to experiment is now the order of the day. Whilst, rigorously pursuing simplification, security hardening and IT automation in localised areas as these steps are taken is the path to earlier value delivery. This means that 2 speed IT is a misnomer, its more like 6 gear 4 wheel drive IT, which adapts to different terrain and problems.  

The Renaissance of the City State - Digitally of Course

This week is London Tech Week, a series of co-ordinated and themed events aimed at promoting London's place in the Digital World. So the week was kicked off with a talk by Sadiq Khan (Mayor of London) at the Francis Crick Institute (Crick was one of the pioneers in DNA research) where he spoke about London's "leading position in AI"; apparently London has 745 AI focused companies, which is more than twice the number in Paris and Berlin combined. He also spoke about his ambitions for London to become the world's leading smart city, which will obviously be a challenge given the competition from Bangalore, Singapore, China in general and quite a few American cities even before some unexpected contenders such as Moscow are taken into account.

Yesterday TechXLR8 kicked off as one of the major combined exhibition and conference events, combining a huge number of themes: IoT, VR/AR, Cloud, DevOps, a platform for small start ups (known as project Kairos) as well as pretty much smart everything or SmartX. TechXLT8's theme this year is "changemakers" across technology, business and society and the opening talks were quite focused on the national and smart city impacts coming.

So Greg Williams (Editor-in-Chief of Wired) mentioned that 13 of Europe's 47 or so Unicorns (digital companies worth more than $1Bn) are based in Britain. Gavin Patterson (the outgoing CEO of BT) emphasised how BT is preparing to invest in the next new wave of connectivity infrastructure such as FTTP, 5G and quantum key networks with pilots for 5G and quantum key networks having just been announced. This investment is aimed at keeping Britain as the "leading digitally enabled nation" in the world.

Juliet Bauer, Chief Digital Officer for NHS England, discussed the recently published Digital Roadmap for the NHS and how this should drive a revolution in the way in which citizens access and receive treatment from the NHS as well as a shift towards greater prevention of health problems before they become serious.

Paul Copping, Chief Innovation Officer for Greenwich, discussed some of the challenges for cities moving to a Smart City model and the architectural issues around defining what a "City Digital Platform" really looks like and some of the questions around the blurring of lines between local city  authority provided services and private digital service providers, especially with respect to access methods. He also discussed issues of future integration and interoperability between adjacent metropolitan areas and how to marry architecture with public procurement processes. Though what he did not mention was the need to deliver iteratively in small chunks and experiment to continuously fine tune solutions before investing too much or how to abstract changing technical standards within service wrappers to deal with obsolescence across the long time frames needed to implement anything at this scale.

Colin Rhys, VP Virgin Hyperloop for Middle East & Asia, spoke about how Hyperloop could make commuting distances such as London to Edinburgh on a daily basis quite feasible, extending the footprint of cities outwards. His tag line "live in the forest, work in the city" offers the prospect that digital enablement plus fast transport means that the "virtual city" of the future will spread far beyond the natural physical boundaries of a cities geography and extend almost like a virtual state into the rest of the country or continent in which it is located. This has implications far beyond the traditional turf wars between metropolitan and rural councils over "who owns whom" for the purpose of local taxation and implies that all these councils need to collaborate more effectively for collective good. This means that we need to rethink socially our ideas about cities and rural communities and address a whole host of issues around community identity, legal frameworks, representation, pooing of investment and resources, as well as how to deliver the grand scheme that a Smart City is base upon.

The Chief Data Officer

Many organisations are experimenting with the concept of a Chief Data Officer. Although according to Raconteur most are struggling with the concept as well as making headway with the concept of managing data for value.

It seems that there are a number of problems:

• Business Understanding of the Role and Data Issues;
• Resourcing, Funding and Provisioning Data Initiatives;
• Current Starting Points for many Businesses with Poor Data Quality;
• Focusing too much on compliance and not enough on Value.

Personally, I would suggest that there is a value staircase for Data Management starting with Compliance and Protection on the Bottom Rung and then progressing through Quality, Integration, Sourcing (external data feeds), Insight & Intelligence to Adaptive Control (involving use of machine learning, experimentation and up to the minute data feeds to optimise control).

It is difficult howver to obtain value if a business tries to progressively work its way upwards through this staircase if it attempts to do everything in the first one before attempting the next step. The scope is too wide. Instead busnesses need to prioritise a business problem or opportunity and address a vertical slice down this value staircase to deliver value quickly. Progression can be achieved by addressing the next opportunities and reviewing what is needed in each step to improve overall capability as each increment is implemented.

However, probably the biggest issue is the role. What is the difference between a CIO, a Chief Digital Officer, a CTO, a CSO, a Principal Data Archiect and a Chief Data Officer? These all overlap and are often confused in scope. Many businesses are handing the Chief Digital Officer role back to the CIO, so it may be time to do the same with the Chief Digital Officer, because if they are separated the CIO's role is hollowed out to just look at the plumbing and not the value to the business.

It is also important to delegate data quality and integrity to business managers responsible for exploiting data in their day-to-day operations. IT may provide the policy framework, tools and measurement framework for managing data quality, but line management needs to take responsibility and include data quality in their personal objectives, just like they do with budgets. Otherwise value will never be achieved.

The Business of IT

I have re-released a book I wrote several years ago, on amazon "The Business of IT". It's a simple primer for the first time IT executive. Its premise is that you need to treat IT as a business within a business and manage for value. It covers most of the main concepts that a new time leader needs to be aware of and points out to many areas of established industry practice.

Asia's Digital Dragons

Asia's Digital Appetite

According to experts in McKinsey, Asia is grabbing the opportunities available from digital to try and leapfrog traditional economic leaders in the west and compensate for historic lack of investment in infrastructure. They single out India, Indonesia and China as the countries with the most energetic approaches and the most innovation. They cite greater appetite for social media take up and openess to mobile and other new technologies as drivers to greater innovation.

This position is supported by Gartner's identification of Asia's 10 leading digital disruptors:

• Tencent
• AliBaba
• Baidu
• Ant Financial
• JD.com
• DiDi
• Xiaomi
• Yahoo Japan
• Naver
• Lufax

The interesting fact about this list is that it is dominated by Consumer oriented businesses. B2B opportunities are yet to be exploited. Even so, the power house that is AliBaba is reputed to dwarf western giants such as Amazon. So Asia is currently playing to its numbers and culture to establish scale.

Garnter recommends that western enterprises operating in Asia should consider adopting local platforms to guarantee penetration and better customer experience in Asian Markets.

Future Digital Directions in Asia

A recent survey of global CIOs by Logicalis showed that CIOs in the Asia Pacific area have been disappointed by slow progress overall in adopting digital business models. Like CIOs in other parts of the world they have seen typical barriers such as Organisational Culture, Scale of Investment, Legacy Infrastructure, Skills and Security holding them back.

However, overall they are typically planning to address them with moves to simplify and modernise infrastructure, work closely with other business colleagues to address specific opportunities, improve training, invest in culture change and generally increase security investments.

In doing so, they are preparing to lead change and more B2B services are likely to emerge, balancing Asia's digital economy.

Digital Strategy Burps

McKinsey claims that many organisations are making serious mistakes with Digital Strategies.

Putting aside thos companies whose strategies are just a wish list of possible opportunities, McKinsey believes that typically there are 5 issues with enterprise Digital Transformation Strategies:

1. Unclear definitions;
2. Misunderstanding the changing economics that digital is driving;
3. Overlooking eco-systems;
4. Focusing on familiar competitive threats, rather than emerging ones;
5. Failing to understand that it's not just existing business that needs to be digitised - and not discarded - but that new businesses need to be invented, too.

 Though they note that in some industries, digital is accentuating the gap between winners and losers, with small numbers of winners grabbing huge market share and squeezing out the losers, whilst they also change the nature of the market.

Though more pragmatically, at a recent Gartner conference four CIOs spoke about the practicalities and emphasised focusing customer and people outcomes and experiences, using demonstrators to illustrate cross fiunctional opportunities and experimentation to build new business opportunities. Here too there was a theme of building on the existing legacy capabilities to blend the existing with new opportunities.

Analysis by the Boston Consulting Group reinforces some more orthodox lessons:

1. Harness the Power of Data
2. Redefine Your Customer's Journey
3. Build Digital Capability Through the Whole Organisation
4. Transform Governance and Explore Collaborative Ways of Working
5. Re-inforce Innovation Capabilities

 Broadly speaking this all fits with the DAF framework and principles contained within the Way of DAU.

IoT Adoption Drag

IoT Makes Slow Progress

Despite all the hype and general acceptance of its possibilities, IoT is making slow inroads into enterprises and can still be regarded as being in the early period of adoption in many businesses.

I have talked about CxO behaviour and culture in previous blogs as well as security and other issues, so what is holding IoT back?

Business Leader Perspective on IoT Adoption

A recent survey by the Economist Intelligence Unit (sponsored by IBM and ARM) involving over 800 executives around the world looked into the issue. This suggested that fewer than 10% had extensive IoT implementations, although many had dipped their toes in the water.

More positively, around 25% stated that IoT adoption was sparking innovation within their organisations with 22% indicating that IoT offered new opportunities, 20% saying it was changing business models and 16% believing that it was enabling entry into new markets and initiatives. So the overall picture is quite positive about its transformational potential.

Only 15% believed that IoT would significantly reduce costs, suggesting that IoT adoption is more about re-imagining their businesses than old fashioned cost cutting.

Interestingly enough, few executives saw technical issues as blockers to adoption. The key constraints cited were the Size of Investment needed (29%), Security and Privacy concerns  (26%) and lack of CxO Knowledge and Commitment (23%). 

This points to a smoking gun around Cost and Executive Behaviour / Team Buy In.

IT Leader Perspectives

Interestingly enough the British Computer Society's (BCS's) survey on Digital Leadership shows some mismatches.

Over the last 4 years the principle concern of IT Leaders in the Digital Space has been Security (averaging 60% of responses, plus or minus 2% over this period). The second most important concern has been Cloud (at 50%). In the last 2 years, Governance has moved into third place at 35% followed by Agile and Big Data at around 25-30% each. IoT was only cited by respondents as a major interest by 18%. Although Cloud, Agile and to some extent Big Data are involved in IoT adoption.

This suggests 2 things. Business Executives are over confident about implementation issues and that IT Leaders have a mismatch in alignment and understanding with business aspirations.

IoT Success Factors

So it appears that CxOs need to get together and agree a common vision and set of priorities. IT Leaders need to build IoT into their plans and there is a need for education and collaboration to get a coherent approach in place.

Are You as a CxO The Real Culprit?

Digital Impacts on Business

In a recent article in the Sloan Management Review, it was mentioned that 87% of executives think that Digital will affect their market place. Yet out of the 75% who thought that their enterprises are adequately prepared, only around 10% saw it as a potential threat to their business.

This is only one symptom of the many aspects of CxO behaviour which are affecting the success of organisations which want to adopt a digital business model. Overall, there is often a lack of realisation that the CxOs themselves are inadvertently sabotaging their organisations' efforts.

Executive Behaviour Can be a Problem

In many cases, in the same manner that many executives don't understand what it means to be a project sponsor, CxOs have failed to actually engage with the issue. They don't seem to think that they should spend the time to get involved in deep market analysis and identify real game changing opportunities. They just want to automate yesterday with some sexier technology.

Additionally, they don't get the need for acting as a joined up team or building a positive culture which supports experimentation and innovation. In fact, many executive teams don't seem to understand that innovation means doing something that no one else has done before, so there are bound to be a few issues along the way as a product team discovers what works and what does not.

David Snowdon provided a great framework with the Cynefin model to explain what is involved with emerging practice and chaotic conditions.

This is why the DAF (Digital Adoption Framework) places significant emphasis on cultural change as promoted in The Way of DAU. Culture is a known inhibitor to strategy implementation, as witnessed by the well known quote that Culture Eats Strategy for Breakfast. Culture change starts with the C-Suite and ripples down. So any CxO looking for digital success, should be asking whether he or she needs to reach out work with C-suite peers to build a better team. Otherwise, failure beckons.

Executives Need To Learn How to Promote Innovation

On another tack however, a research based article on innovation and executive behaviour published in the Harvard Business Review, outlines some personal behaviour characteristics of entrepreneurial CEOs and other top executives: 

• associating, 
• questioning, 
• observing, 
• experimenting, 
• networking.

Their observation was that CEOs in successfully innovative companies take more ownership of innovation, look outwards and provide leadership to the innovation process and get personally involved.

Digital's Impact on the C-Suite

One of the interesting things about Digital Adoption and Transformation is the way in which it is impacting roles in the C-suite.

In some early adopters, the default leader for digital transformation was the CMO, as digital marketing initiatives picked up and marketing ran away with the ball.

In second wave adoption there has been a bit of a split between whether a specially appointed person, the Chief Digital Officer, should manage the business's strategic response and run all things digital. In others they have handed this to the CIO. Though occasionally the CEO has decided that this is too important and grabbed the reins him/her-self. The longer term trend does appear to gradually hand this back to IT and CIO (as discussed in previous posts).

However, there is a growing realisation, as discussed in a recent Forbes article, and in my book that culture is crucial to success. Culture needs to be aligned to a number of positives:

• Collaborative working across functional siloes
• Product and value focus
• Opex Thinking
• Tolerance of Experimentation and alignment of Risk Appetite with Value and Learning from Failure/Experience
• Customer Focus

Apparently, this is now leading to the situation where enterprises are beginning to appoint Chief Culture Officers.

Additionally, some are also appointing Chief Customer Experience Officers to reinforce the idea that the key value proposition of Digital is Excellent Customer Experience. Although in design led organisations this may be Chief Design Officers who are also interested in the customer engagement by design thinking.

One of the questions that we have to ask is how will this mature? at the end of the 19th Century as electricity started to be adopted, some organisations flirted briefly with Chief Electricity Officer roles, but they did not last long.

Will Chief Culture Officers be subsumed into Chief HR Office roles and will this change the face of HR for the better? will customer experience revert to the Chief Marketing Officer, or will CIOs hybridise and pick up aspects of these roles as part of the CDO element of their job as they delegate more technical aspects to CTOs. Or will CTOs have to become more human?

Whatever happens, CxOs will all have to rethink what their core attributes and operating models should be. Digital required disciplined team play, as well as skills and flair.

Singapore's Digital Transformation

Asia is known for the appetite of its businesses for innovation and within Asia, Singapore is often seen as the leading city for innovation and innovative thought. So it's interesting to see the results of surveys published in the "The Business Times".

In 2016, 49% of business leaders were said to be in denial of the need to for Digital Transformation. Yet by 2017, in another survey, only 16% of organisations said they had done nothing about digital transformation. Interestingly enough 50% were actively progressing a digital strategy and about a third had a strategy, but had not really got going on delivering it yet.

This is reinforced by claims in a ZDNet article  that over a quarter of businesses see Digital Transformation as essential to survival. The Singapore Business Federation has expressed concern that a significant proportion of businesses have not made a start on any form of business transformation and within this section two thirds demonstrate lower than average profitability.

However the latter survey was not without its apparent contradictions. three quarters of the survey respondents thought that new data insights would lead to new revenue streams, yet their highest priorities were customer engagement, optimising operations and empowering employees. Transforming products and enabling new business models trailed in at 4th in terms of priorities.

When it came to enabling technologies, Big Data (for Insight) was not mentioned. IoT was the leading technology, followed by AI, then wearable technology, and VR, followed up by quantum computing. Again this does not appear that consistent with enabling the stated priorities.

So whilst the enthusiasm is there and appears very strong, the clarity of thought appears to be not quite crystalised. Perhaps this is a symptom of rapid change in attitude.

Interstingly enough, the top 3 roles associated with leading digital transformations in the 2017 survey were CDO, CIO then CEO. CMOs appear to be out of the running there.

Digital Engagement Surveys

At this time of year, Nimbus 90 performs a survey into technology trends and issues concerned with adoption. This is based on the opinions of 100s of senior IT professionals working in the UK and is part of their symbiotic business model, research funded by suppliers and supplemented by knowledge sharing networking events.

I have just been looking at last years survey report which was interesting in how positive it was. There was a strong focus on re-inventing business models, with a high emphasis on customer experience and expectations.

The thing which really struck me was how few organisations saw a digital model as a cost cutting exercise. Although the number looking to improve operational efficiency slightly out stripped those looking to launch new products.

Key benefits anticipated included innovation, agility, customer engagement and better decision making. Though, quite sanguinely, expectations around customer loyalty were quite muted. Perhaps this was early recognition of the greater volatility of customer loyalty within the digital world when compared with traditional ways of doing business.

The one thing which did not come out was much use of AI or Machine learning. This has been a bit of a theme this year. So it will be interesting to see what comes out.

Also, sponsorship of Digital Programmes appears to be all over the place at the moment with CEOs, CIOs, CTOs, CMOs and CDOs all in on the act. Although surprisingly few COOs appear to be involved. Some of this is obviously diue to different corporate structures and sizes. but again it would be interesting to see what happens.

Harvey Nash's Tech Survey

Last night was the London Launch Event for the Harvey Nash Global Tech Survey Report - Race for Your Life.

The Report itself contains some obvious points, e.g. Younger Companies tend to be more innovative than established ones. However there were some surprising findings Construction and Engineering is the leading sector for innovation, with twice the preportion of respondents claiming their organisation is innovative than say Finance (which is investing heavily in FinTech). The FMCG  and Consumer led sector came bottom with less than 5% claiming any innovation.

Encouragingly enough the proportion of respondents who claimed that their organisation is innovative had also grown since the previous survey. Happily enough CTOs came out as more innovative than CIOs (which they should be, as its part of the job description), but CEOs also came a nose ahead of CIOs too.

As the survey is run by a recruitment specialist there is a focus on a number of recruitment centric issues. There are stong sentiments that Ageism dominates recruitment with adverse impact from your 40s onward. People still beleive that a human recruiter is far better than a machine at matching people with the right jobs. There is an increasing emphasis on completely refreshing skills every 5 years with many people investing personally in their skills.

In fact a lot of the panel discussion focussed on how organisations look at people, culture and mixed / diverse teams when building them. It seems that there is a frustration that older people cannot seem to get their CVs past recruitment consultants to the hiring manager. So what is the bottleneck there?

Close to 40% of people felt that automation would affect their jobs. Whilst this is quite high, considering that the last 30 years have been spent trying to automate IT people out of their jobs (without much success), it is probably quite necessary as there is a worldwide shortage of talent.

Two things struck me from the panel discussion however. One was positive, given that the panelists were from Tech start ups and Digital Model based companies; they all considered themselves to be the guardians of their business's appraoch to ethics. 

The negative was how much they failed to convey an understanding of innovation. They were seduced by the acquisition of technologies (by one means or another), but none of them mentioned how they empathised with customers to get at their real needs. There was no discussion of design thinking.

The other issue which came alongside this was how all of them were only just getting to grips with the idea of designing and operating to avoid technical debt. Previously, they had all been in too much of a hurry to just deliver something.

So in terms of how mature is the average operator in the new Digital As Usual (DAU) world. It's looking like 5 out of 10 to me.

Is Your Enterprise Digital Ready? - Summer Time Reading Recommendations

Sometimes it is better to make sure that other people think that they had the idea first. As Information Professionals are not always believed when they try to persuade their business colleagues that they need to change their ways, if they are going to get the best out of their Digital Strategies and Investments.

The truth is that there are some fundamental issues to address which separate Good or Average performing companies from Excellent ones when it comes to exploiting IT or Digital investments and transformations. Proponents of Digital Strategy, Agile and DevOps often raise them, but due to the fact that these issues are being raised in a technological context, non IT colleagues tend to either listen and not hear or just dismiss them as the mad ravings of techno boffins.

Key among these are:

1. Having a "Real Business Strategy" based on deep market insight and how to disrupt or exploit it in your favour;
2. Working as a Team within a healthy Business Culture;
3. Adopting Design Thinking to help empathise with customer needs, really understand what you are trying to address and then to creatively address options and iterate design to create elegant and well targetted solutions rapidly, whilst embracing leraning from failure as a critical part of the approach;
4. Systems Thinking to understand the end-to-end process, identify and manage critical business bottlenecks and organise around product or work delivery, instead of hierarchical functional silos.

A large part of this is really concerned with taking an ego-less multi-functional team approach to addressing what is really needed and then pursuing continuous delivery, automation and improvement in small steps. 

Fortunatley there are some great business books on some of these subjects which evryone should be encouraged to read as they address the issues from a more general business perspective and introduce the key concepts that all the Digital Geeks are so keen on.

My recommendations are:

Good Strategy Bad Strategy is a great expose on how to do Strategy properly. Most readers will recognise many of the bad examples which are lacerated by Richard Rumelt (one of the leading fathers of Business Strategy) in what is a fairly easy and entertaining read.

Winning Teams Winning Cultures  - addresses a lot of the key issues in building a positive enterprise culture. This comes from Larry Senn (of Senn Delaney a culutural change consultancy) and Jim Hart who are long time practitioners in the field of cultural change. It's an interesting book, because just like democracy it is difficult to bomb culutural change from 40,000 feet into an organisation. It requires authenticity, long term commitment and sytematic sweating by the management team to achieve.

The Human Constraint - the author (Angella Montgomerry) takes the principles advocated by Demming and Goldratt and updates them to apply to all businesses (not just manufacturing) in the practical adoption of system thinking and the Theory of Constraints to business in general.

Finally there are plenty of sources on Design Thinking available on the internet. The UK Design Council publishes the Double Diamon model which provides a simple model for explaining the process. I recently saw a great webcast by Ileana Stigliani, fom Imperial College Business School, on the subject Unleash Innovation Through Design Thinking

(see: https://www.ivyexec.com/professionals/classes/details/unleash-innovation-through-design-thinking ).

The Inexorable DevOps Steamroller - 2017 State of DevOps Report

Puppet and DORA have published the 2017 State of DevOps Report. This analyses their most recent annual survey of DevOps practice and contrasts it with previous findings. 

(See: https://puppet.com/resources/whitepaper/state-of-devops-report)

It's pretty safe to say now that, with over 25% of respondents claiming to practice DevOps within their organisations, DevOps has become mainstream and is firmly embedding itself in standard practice.

The most striking thing about the current survey is that it examines the link between Transformational Leadership and successful adoption and goes on to assert that there is a correlation between successful adoption and IT Performance, as measured by speed of software deployment and stability of operations. The trends suggest that whilst laggards are starting to catch up in terms of deployment speed, this has been at the cost of worsening stability, expressed in terms of rate of deployment failures and times to recover.

More exciting though is the claims of correlation between IT Performance and Business Performance, using a range of measures of success such as Customer Satisfaction, Achieving Business Goals and Operational Efficiency.

The report also goes on to analyses various of the practices associated with DevOps, such as Continuous Delivery and Automation to conclude that it does have a statistically demonstrable impact on the success of Lean Development (otherwise known as Agile).

Overall, you can only conclude that if an enterprise is not practising DevOps yet, it should. Its very survival in the world of Digital As Normal will depend upon it. The business case for automation and software as infrastructure has never been stronger and the performance gap between those who adopt and those who don't is huge.

GDPR, CIO issues, Lean Data & Data Portfolio Management

Last night's CIO event hosted by Harvey Nash and KPMG was held to launch their 2017 CIO Survey "Navigating Uncertainty".

In the Panel discussion afterwards, one of the key issues raised was about "knowing where your data is". GDPR is certainly driving this, for personal data in Europe and anyone who trades with organisations or consumers based there. As its difficult to implement the "right to be forgotten" if you don't know what data you hold and where it is. Similarly, SoX in the US has driven similar concerns about Financial data. The move to "Cloud First" also compounds this need, as it is core to successful integration.

So why is this such a big deal as much of GDPR is about doing things which a business really ought to be doing anyway? basically its ancient history. Most large organisations have grown partially by merging with and acquiring other organisations. Their management teams often have the tendency to declare victory before full integration occurs.

Then there are cost cutting issues. Most businesses have been through boom and bust cycles of  large investment followed by cost cutting and asset squeezing. Often this has included head count reductions or outsourcing. Each of which ensures that knowledge about where things are leaves the organisation. Many service providers tend not to document things well, if they are allowed to get away with it, as this helps keep effort and FTE (therefore costs) down. There is natural staff churn of anywhere between 5% and 20% per year in typical companies, depending upon culture, rates of pay and opportunities. Documentation does not keep pace with lost knowledge as exit processes are usually poor in knowledge transfer.

Finally, DIY activities in the business often results in unofficial applications being adopted, especially as XaaS makes this easy to do. So put this all together and it is little wonder that organisations often do not know where their data is or even what data they have. This is a situation which brings inherent risk. If an organisation does not know where its data is, how does it protect it. If no one knows what data is help and "managed", then how is it integrated, kept coherent, kept clean and timely? how does the organisation know what it is actually spending on data or even what the value of its data is. Then there is the small matter of compliance. How does the organisation know whether it is complying. These are all data hygiene issues which need to be addressed if digitisation is going to support a Digital Business Model.

So now is the time to introduce Lean Data and make sure that Data Portfolio Management (DPM) is practiced as part of any approach to Asset Portfolio Management. (Asset Portfolio Management = Application Portfolio Management + Infrastructure Portfolio Management + Data Portfolio Management).

Lean Data principles mean that:

• Organisations know what data they hold and manage;
• Data is classified according to subject area and criticality;
• Only the minimum data necessary to Add Value to the business is held;
• Data replication is kept to the minimum level necessary to optimise business performance;
• Data Value is determined by its utility in Serving the Customer, Supporting Essential Capability, Protecting the Organisation, Providing Insight for Business Decision Making.

Data Portfolio Management is concerned with:

• Knowing what data is held and where it is;
• Understanding the quality of the data;
• Knowing what technology is used to manage the data and its overall condition;
• Being able to address questions concerning issues such as criticality, protection, archiving, cost of management;
• Understanding how Master Data Management (MDM) and integration occurs;
• Knowing who has Stewardship responsibility and consumer rights for the data;
• Regularly reviewing management actions to improve Data Value and address Lean Data principles.

DIGITAL DECEPTIONS & ACCELERATION

It has been a great week for special events. Trump did the unspeakable and pulled off the Presidential contest in the US. Who would have forecast it?

Away from politics, there has been great excitement with the announcement that Dubai could host the debut of HyperLoop One's radical transit technology, linking to Abu Dhabi in 12 minutes and implementing Elon Musk's vision of near supersonic pod transport.

Sitting over a glass of Moldovan Wine (yes Moldovan) at the World Travel Market, in London's Excel, I casually bumped into one of London'd start up kings, Razvan Patrascioiu, see http://bit.ly/2fydFf4 , who is working on his new venture to ensure that London's visitors get to really enjoy the great restaurants that have become part of the capital's landscape. Later over Slovakian and Israeli wine on other stands I mused on the power of wine to connect people, especially in the digital world. So anyone who is remotely keen on this idea should check out the Chief Wine Officer on LinkedIn and Twitter. This is still my favourite digitaly enabled marketing vehicle and remains extremely effective at connecting CIO level people with technology providers.

Anyway, anyone who actually read my post about digital vikings, will know that digital entrepreneurs face defensive business fortifications which can derail their asymetrical attacks on new markets. This week Facebook halted the deployment of a Fintech Insurance app aimed at correlating facebook behaviour with driving behaviour. Facebook will not release the data to be used in the app. It's against their policy. Additionally, Uber was told that under UK law, their drivers are effectively employees and entitled to minimum wages and holiday pay. This just goes to show, that you need to able to respond quickly to set backs and if you cannot anticipate problems, at least plan to implement in ways that adapt to changes in circumstance and don't burn all your funds at once.

Finally in a great demonstration at the ACM Conference on Computer and Communications Security Hofburg Palace, Vienna, Austria, researchers from Carnegie Melon demonstrated how special glasses could be used to fool commercial facial recognition systems. For example a male test subject wearing the special glasses was recognised as actress Milla Jovovich..

It's strategy Jim, but not as we know it ...

A friend of mine who was a leading light in the development of Information Strategy and Architecture practices in the 80s and 90s, retired a few years ago. The key driver being his disillusionment with organisations who said that there was no time for developing strategy.

In the time since then, Enterprise Architecture has enjoyed a considerable re-birth and growth, everything has gone digital and organisations have started to publish strategies which read more like marketing guff expounding bland benefits, than anything which informs the reader or directs action.

A couple of things have brought this to mind recently. the first was that I picked up a copy of Richard Rumelt's "Good Strategy Bad Strategy", in which he emphasises the need for a situation diagnosis of what is needed to succeed, proposing an integrated and coherent policy which addresses this, and a small set of supporting actions. This is a great read and worth while for anyone interested in Business Strategy.

Yesterday, I went to very stimulating talk about post merger integration by Henry McNeill at the British Computer Society. Afterwards as we huddled around the wine and sandwiches, several key themes came out:

• Many companies are still not aligning acquisition activity with business strategy;
• There was violent agreement that clarity of the aims, target state and value proposition of an acquisition is imperative for successful integration;
• Participation of IT from due diligence onwards, provides an ideal opportunity for IT to show how it can help the business articulate and deliver against a strategy for the exploitation of the newly acquired business. Sadly, many organisations are still bringing IT in on Day 1 after deal completion and missing opportunities to mitigate risks and address early integration opportunities quickly. Some still take years to work out what to do with them.

This brings me to the point of today's commentary. My experience has been that almost all business strategies are usually incomplete and fail to unify the senior management of the business. IT needs a coherent exposition of Strategy which identifies the "game changing" opportunities or risks in the business market place to be able to prioritise its investments, define what common capabilities are needed and to support effective innovation. Working with business leaders at C suite and direct report level to "elicit the real business strategy that they work to" and agree the opportunities is valuable to the business as a whole. It's often a great way to get everyone to understand each others problems and can help unify purpose.  However, its got to be continuous to support the ever shifting business environment as businesses go Digital and Agile. Strategy has to take a Fail Early, Refactor and Learn approach to continuously calibrate its diagnosis, unifying policy and action plan. There's a role for the CIO in this.

Death of the CIO

Over the last thirty years I have read the orbituaries of many IT professions.

I cannot count the number of times that I have read of the death of the programmer as some new type of tool was supposed to make everything so easy that programmers would soon die out. 4GLs (or Fourth Generation Languages were supposed to do it in the early eighties, Workflow in the nineties and more recently rules engines). Each time the promoted nemesis has turned out to be more difficult to use than its promoters sales pitches would have you believe. Each time some other technological progression or change has introduced new complexities which need detailed technical knowledge. Always there have been things that these tools can not do, requiring specialist programmers to address short commings.

Likewise, the analyst was supposed to be killed by RAD and then Agile developers, yet we need them even more than ever.

Architect, too have been in the line of fire. At the end of the nineties, as the first internet boom took hold, we were told that there was no time for strategy and we were advised to stop worrying about architecture. Then in the late noughties the current fad for enterprise architecture took off again. So it was not a surprise that I was invited to a debate about "Whether Agile is killing the Architect" a few months ago. Everything is cyclic and Agile only really works well when the overall architecture is pre-planned, unless of course the solution is so trivial that it does not matter.

So it is no surprise then that we often see pundits trying to stir the pot with assertions that the CIO will die out. The most recent justification being that Chief Marketting Officers have stolen the "Chief Digital Officer" crown.

Interestingly enough, a recent global survey run jointly by a well know recruitment agency in partnership with a big 4 consultancy, showed that there is a resurgence of CIO roles here with an increasing proportion of them taking on the role of Chief Digital Officer.

This is unsurprising really, given the range of skills needed to be an effective CIO. They are quite different to those required to be a Chief Marketing Officer and what we are really witnessing is the end of another fad, as the CIO's role adjusts to deal with the new opportunities and challenges involved to shifting to a digital business agenda.

MAD Chickens

Does Your Business Fail To Act Boldly with Acquisitions?

Many of us have been involved in someway with Mergers, Acquisitions and Disposals (MA&D or sometimes know as M&A). We all know that there is a low success rate with acquisitions, as more deals result in destruction in value for the acquiring party than those which increase value. Indeed, I often think of the vintage 60s film "It's a Mad, Mad, Mad, Mad World" as an allegory for a badly executed acquisition.

Historically businesses have tended to treat acquisitions one-dimensionally, with some just regarding them as legal deals and others as a financial transaction. Only recently have management teams begun to take a multi-disciplinary view to MA&D deals, but still they seem to have a blind spot around managing change or the importance of IT integration.

Overcoming Obstacles To Change

There's a critically important phase during the first 6 months or so of a completed transaction where the conditions for success are established or not. During this point it is essential to sow the seeds for successful cultural integration. That is we need to establish the emotional connection between the people within the acquired company and the acquiring company (note even in mergers and join ventures there is normally a dominant partner, so I am assuming acquisition in all instances for simplicity). We also need to establish management control, demonstrate to customers that we are integrating and going to offer something more, and to ensure business continuity. I call these the Cs (culture, continuity, customer interface and control).

IT is essential to this in a number of distinct but important ways, but often management teams fail to invest soon enough in all the Cs. Excuses often proferred are "it's a people based business and we don't want to scare talented people away and lose the value of the business" and "part of the price is performance related over the next N years, so we must not do anything which distorts the picture of performance". This tends to build failure in from the start.

Human Reactions to Change

If you have been through an acquisition yourself, you will know that most employees fall into one of three camps:

The Curious - who want to explore the new business and identify opportunities. These are the natural change agents and entrepreneurs within a business and usually the people you want to keep and encourage as they will create new value in the future.

The Troops - who although they may be wary of change are happy enough to follow where they are led, if only someone would show them the way. They are also the people you want to keep as they know how the business operate and deliver its value.

The Deniers - who want to defend how things used to be, defy change and block progress. Often they will willfully act to preserve their independence or even try to take over the acquirer from within. They may be the people who have destroyed value in the past (which could be the reason that the business was up for sale in the first instance). You may actually need to lose these people to assure future success of the merged new entity.

What IT Can Do To Encourage Cultural Change

Modern change management practices have shifted from trying to convert Deniers to encouraging the Curious and enabling the Troops. In this vein, then IT should be at least doing the following during the first few months of an acquisition:

(A) Ensuring that all essential service contracts and licences re reassigned or replaced; 

(B) Re-branding against the new identity in all systems and outward facing Web sites;

(C) Putting everyone onto the same connectivity infrastructure: e-mail, intranet, collaboration tools, mobile working toolsets;

(D) Ensuring that everyone belongs to the same security and access control systems: e.g. integrated active directory, security passes which work at each site where people work;

(E) Merging HR systems and payrolls, so that everyone is performance managed and paid in the same way;

(F) Establishing basic common controls for high level performance reporting;

(G) Then, launching a project (or programme) to integrate essential ERP processes.

This will not only ensure continuity of the acquired business, but enable the curious to explore and remove excuses for inaction which often prevents successful integration. It will also remove many of the subliminal "them and us" barriers which separate members of the previous historical organisations. Once this happens, then it is possible to pursue new opportunities where the combined capabilities of the 2 former businesses can be multiplied to deliver new value.