McKinsey Quarterly does a great job publishing interview, POV, and thoughtware regularly. An article published today titled “Raising performance by reducing IT complexity: An interview with TalkTalk’s CIO” reinforced some of my thinking about what is important for IT Transformation.
One particular question caught my attention, which I call as Lessons learned. See excerpt below:
The Quarterly: Tell us about some of the factors needed to manage the transition successfully.
David Cooper: Most important was the definition of a clear strategy for harmonizing business processes and customer offerings across different brands. Each separate customer base had significant legacy products and processes. So the only way to move to a new system without drowning in complexity was to be pragmatic about how to handle affected customers under the new system without losing significant value in the process. Since all the business brands were delivering the same fundamental products to customers, we reasoned that it would be possible to harmonize the processes. But getting there required strong management from the start.
Furthermore, to make the transformation happen, we needed the agreement of key stakeholders on the overall vision, as well as their determination to make the changes succeed. This had to come not only from the IT side but also from the business side. In our case, we had the support of our CEO, who set out the
vision for a unified IT landscape as the way forward and united the organization.
Finally, it was critical to communicate, strongly and repeatedly, why we had embarked on this transformation and what the expected benefits would be. It helped that we were able to deliver some benefits relatively quickly. For example, nine months into the integration, it was suddenly possible to market to the entire TalkTalk base, and AOL customers suddenly could access TalkTalk products and features.
As can be read from CIO’s interview, building an Operating Model with Standardization, has provided bottom-line benefits (i.e. IT cost efficiency) to TalkTalk, and at the same time made the organization more agile to changing market/business needs.
3 key takeaways for me, from this interview:
- Strong Executive Management support (CEO onwards) is critical for transformation projects. A CEO has to set the clear Vision.
- Leader, someone with sufficient Business and IT knowledge, and detail-oriented, should drive a Transformation effort.
- Communication is critical! Leader has to reinforce the goals/objectives, benefits time-and-time again.
Yes, Transformation projects shouldn’t be a democracy but it should atleast be a Conversation amongst organizational ranks. So, people’s creative view about Transformation have to be factored-in during planning and execution of Transformation projects. One way to seek ideas is for Managers to socialize the concept and solicit feedback [think Brownbag lunch or “back of the napkin” bar conversation, as my previous Manager & I conversed frequently for ideas]
High-Level Transformation Approach:
Transformation in its broadest sense means “Change”. At the end of the day, organization taking Transformation initiative aim for business growth and improvement. Transformation should be a phased approach, broadly suggested below:
- Phase 1: Create a Roadmap [The roadmap should be jointly created by Business and technology folks. The current state, opportunities for change, future desired state and their implications should be discussed here. Define the key outcome or success factors. A definitive Implementation timeline showing estimated timing and recommended sequencing of Transformation Roadmap projects MUST be created here]
- Phase 2: Execute the Strategy laid out in Roadmap [Detailed Execution Plans, Project Management and Change Management are critical at this phase]
- Phase 3: Leverage the transformed/implemented processes, technology, and organizational changes, to drive business results further
Companies undertaking a Transformation initiative should study on how other companies in their industry have done it, study Case Studies, discuss with fellow C-level executives, and establish exploratory group, before embarking on one.
What would be your suggestion for Executive embarking on a Transformation initiative?