The half-life of a Chief Information Officer (CIO) is said to be about 18 months. In fact, senior executives in some organizations consider the title to be so risky that it is not even used.
Whatever the title of the Information Technology (IT) leader, the 21st Century enterprise must have an effective set of tactics for dealing with the explosive changes that are striking our organizations. In reaction many of us initially quickened our pace. We tried to run faster to keep up. This simply wears us out. It also distracts us from the real issue at hand: a major overhaul of the way we do business, and how we apply information technology. Instead, we must apply new leadership to steer our organizations through the unknown, deal with the ever-increasing demands on scarce resources, and enable organizational competitiveness. To ensure that our organization survives and prospers in the 21st Century, we must begin to employ some new, as well as some time-tested, IT strategies.
1. Focusing on a sustainable competitive advantage
Even agencies with a history of success with long-term, sizable budget increases have seen the light and have changed, or are changing.
An example is the National Aeronautics and Space Administration (NASA). In a January 1998 Office of Personnel Management (OPM) Message to the Senior Executive Service, Daniel S. Golden, the Administrator of NASA explains how he cut the annual budget by 36 percent, while reducing the time to develop a spacecraft from 8 years to 5 years, heading for 1.5 years. In doing this, NASA cut cost from an average of $600 million to $200 million per spacecraft.
The Mars Pathfinder was accomplished in three years for a total cost of $250 million dollars. Ironically, this is about the same amount of time and cost it took to produce the film Titanic. The unprecedented success of Mars Pathfinder is a result of the new NASA concentration on a tactical way of thinking. According to Golden, this includes understanding the customer; establishing goals and goal oriented processes, and holding people accountable for their actions. He also stressed that risk taking is essential and that there would be some failures.
The evidence is that NASA, the Department of Defense (DoD), and other government agencies are turning the corner from business as usual to a new way of doing things. Not just because it is the law, but because it just makes good sense. As a first step, Chief Information Officers (CIOs) are forging new partnerships with their organization's functional leaders that will help them re-think their mission. Leaders on both sides of the partnership are asking anew the fundamental questions about why their programs exist and whom they serve. Once they were asked to defend budget increases; today they are asked to justify their very existence. What do we do? Does it need to be done? Does it need to be done by us? What are the best practices? Will we lead or follow? What is the performance gap that must be closed? How should technology be employed to achieve this? What is the return on investment? These are basic, but important questions that CIOs must be able to answer to survive.
2. Establishing an effective CIO management framework
The Information Technology Management Reform Act of 1996 (ITMRA) focuses on the need for Federal Agencies to improve the way they select and manage information technology resources. Management of information technology, as envisioned under the Act, merges with other management processes within an Agency to form a well-integrated whole. All government managers, not just CIOs, must work in close partnership to improve government operations and procedures using information technology.
In DoD, managers participate in three major decision support systems that assist the Secretary of Defense and other senior officials in decision-making.
These systems are:
- The Requirements Generation System that produces information on projected mission needs,
- The Acquisition Management System that provides for the acquisition of quality products needed by the nation's Armed Forces, and
- The Planning, Programming, and Budgeting System (PPBS) that provides the basis for making informed affordability assessments and resource allocation decisions.
One of the DoD Chief Information Officer's goals is to help managers fully exploit these systems to help achieve sound decisions on information technologies. Along with these systems, other reforms, such as Defense Reform Initiative (DRI), Government Performance and Results Act (GPRA), and ITMRA are underway. Each requires a
grass-roots understanding of how people will use information. As technologists, we are not always comfortable with the intangible side of how people work, how they are motivated, and how they passively resist change they do not understand. What we call an intuitive, Windows-based graphical user interface (GUI), they call "sitting in front of a computer screen all day." One thing that DRI, GPRA, and ITMRA have in common is a requirement for performance measures that show categorically that an investment produces a measurable, positive result.
Emphatic results will need to be shown every step of the way towards achieving an organization's mission. There will be no patience for programs or projects that go on and on spending huge dollars, waiting for the big bang to occur at the very end. Capital investment planning, common infrastructures, and multi-functional integration will be the by words of the 21st Century CIO. This is easily born out by a quick glance at the Defense Department's CIOs homepages.
3. Employing enterprise frameworks to satisfy modern information needs
Through the years, major change initiatives have mostly followed a pattern of:
- Formulate Strategic Plan
- Construct the Baseline
- Benchmark and Select Best Practices
- Develop Future Process and Data Model of Improvements
- Build a Business Case
- Implement Process Improvements
This has come to be the accepted approach for Business Process Reengineering (BPR). Much of this BPR succeeded, but some did not. In addition to the above steps, grand technical architectures or enterprise frameworks were created. However, many would say that far too much energy was expended searching for the ideal high level architectural modeling methods rather than implementing improvements.
This led many away from the top-down approach to modeling the workplace using a bottom-up methodology commonly known as workflow analysis. This is the opposite of an enterprise framework, and while seemingly much simpler, it often makes determining the effectiveness of work process even more difficult. The big picture gets lost in the details of the workflow.
A more practical approach is to apply an enterprise framework that sufficiently defines the top layer. The framework should then be used to evaluate the merits of individual projects, such as building a data warehouse, developing a software application, or acquiring a computing infrastructure). There are many architectural frameworks out there to select from. The Joint Technical Architecture (JTA) is the one DoD follows. It is constructed using common building blocks similar to those developed by John Zachman, who created the Zachman Framework for describing complex organizations. Whichever framework is chosen, it must give the CIO the context necessary for showing that information technology investments do in fact satisfy the real business or mission needs. The enterprise framework must contain the 'Process Knowledge' that enables the enterprise to accomplish its mission. Process Knowledge refers to a company's collective knowledge about what works or doesn't work inside the enterprise.
Process knowledge is what is captured and maintained in the process and data models typically built during a reengineering project. But these models have often been idealized or conceptualized models lacking in operating detail. Workflow models have the opposite problem. They have too much detail and frequently have no connection to higher order processes and no way of handling process knowledge.
For the 21st Century CIO, the answer to this conundrum will likely be the integration of process and workflow models into the enterprise framework using tools that capture and maintain process knowledge at any level and that allow the models to be easily extended or taken apart for different purposes.
Viewed this way, a workflow model becomes an instance of grouping processes from the process model to accomplish a specific purpose. Workflow models should be derived from best practices process models and continuously updated.
The result is an enterprise framework that integrates:
- The Business Strategy,
- The Workplace, and
- Information Technology.
Coupling, or overriding these three principles, is a desire for information superiority - sometimes called Knowledge Management, human interaction or culture, and process management. To decide if your IT architectures, frameworks and investments are effectively meeting this goal of information superiority a technique known as Value Chain Analysis, should be applied. Chrysler Corporation's Supplier Cost Reduction Effort (SCORE) , which began in 1989, is a good example of this approach. Credited with reducing operating costs by over a billion dollars a year, the effort did not entail large-scale application of advanced technology. Instead, by working with all affected parties and documenting the value chains (i.e., business processes and information flows), Chrysler identified considerable waste and inefficiency. Through this process many smaller improvements were taken that when aggregated added up to large savings. This model allows the CIO to both maintain the requisite systems architecture and to accomplish his or her most important responsibility - supporting the real business purpose of the organization and its customer.
How important is this to the customer? According to Admiral Archie Clemins, Commander in Chief, US Pacific Fleet, this is a vital requirement. He believes: "a system that is devoid of stovepipes" is what the customer wants. It is for this reason, the Army Enterprise Strategy calls for the development of operational, systems, and technical architectures that describe warfighter's information exchange requirements in a manner that mandates and promotes the use of commercial standards and protocols and that ensures systems are interoperable.
4. Instituting a strategic IT planning process and measurement metrics
One thing that DRI, GPRA, and ITMRA have in common is a requirement for performance measures. In other words, it must categorically be shown that an investment produces a measurable positive result (e.g., leads to information superiority) when compared to past performance results.
Other policy and guidance such as: the General Accounting Office (GAO) Assessing Risks and Returns, Office of Management and Budget (OMB) Circular A-11 Part 3, Capital Programming Guide, DoD Directive 5000.1 Defense Acquisition, has the same requirements. In fact, these requirements can be mapped to Clinger-Cohen, known as ITMRA, which is particularly specific about process and measurement metrics. While the steps are stated in slightly different terms, ITMRA and other guidelines follow a similar prescription for articulating and justifying information technology investments:
- Define baseline situation
- Set goals and objectives
- Determine Capital Asset Alternatives
- Estimate of Life Cycle Costs, including projected and actual costs, benefits and risks associated with investments
- Conduct Cost Benefit Analysis including quantifiable measurements for determining the net benefits and risks of investments
- Perform Risk Analysis including risk-adjusted return on investment comparing and prioritizing alternative information system (IS) investment projects
- Establish Performance Measures
- Complete Periodic reviews of selected information resources management activities in order to ascertain the efficiency and effectiveness of IT in improving process performance.
Even though many will say that these steps are not new, what is different is that they must be done prior to investment approval. Another difference is the shift in focus from the fixation on inputs to the output side of the equation. Instead of asking what does a line of code cost or how much is a personal computer, functional leaders and the CIO will be asked to defend IT investments by answering these key questions:
- How much time does the process take?
- Who does the process?
- How much does the process cost?
- What are the primary outputs of the process?
- What transactions does the process require?
- What is the quality of the process?
- How will the IT investment improve the overall process performance?
5. Adopting process management thinking
We must understand our core business processes and introduce process management thinking into our organizations.
Leaders who adopt this thinking:
- Are intensely focused on their customers,
- Have a clear vision,
- Have stretch performance goals based on customer requirements,
- Depend on teamwork and partnerships with both suppliers and customers,
- Delegate authority to the lowest practicable level,
- Question performance inhibitors such as binding policies and laws,
- Organize work around end-to-end processes, and
- Focus on outputs and outcomes and their value to the mission.
To manage this way, we must identify our core processes and understand how they relate to our organizational units. How do we work across organizational lines to achieve our goals? The United States Marine Corps took this approach. They designated an owner for each of their eight core processes. Each owner works with the functional leaders (the names on the organizational chart) to ensure each functional activity contributes added value to the process as the work crosses functional boundaries. This required a major shift in management thinking on the part of the Corps' senior leaders. They have adopted and are institutionalizing this thinking with the help of a strong education and training program, including executive level seminars. How strongly does the Marine Corps feel? General C. C. Krulak, Commandant of the Marine Corps, had this to say:
"... a command and control system that is both flexible and adaptable. If we do not utilize the right command and control processes or build the right systems to support them, and if our Marines do not possess the intellectual abilities and technical expertise to employ them, we are doomed to failure."
6. Dealing positively with multiple individual and organization cultures
In former General Motors (GM) Chairman Roger Smith's memoirs, he laments that he did not understand that the people in GM could not implement his strategy. What Mr. Smith was trying to do was to simultaneously integrate the cultures of GM, Electronic Data Systems Corp (EDS), and Hughes Aircraft, while changing GM automotive from 5 autonomous divisions with their own model cars to a company based on 3 worldwide car platforms for 5 different name plates. In the five years that this was going on, GM lost over $60 Billion dollars. Mr. Smith said it was because they did not understand how to deal with multiple individual and organization cultures. The lesson is to never ignore the impact of culture when making big change.
It is critical for all of us in government and industry to learn from these experiences, and our own, as we slice and dice the processes in our own environments to achieve new objectives demanded by our customers.
Look at the most fundamental processes, for example, how do the people at the clerical level see the mission, the strategy and the organization? They are in a tactical role -- they need to get that report out every day, and while we are either making that easier or at least initially harder, we must instead ask - Is that report even needed? Or, is it duplicated by the employee as a crib-sheet in a simpler, easier format that they actually use to get work done. We should methodically ask the workers what really works - then eliminate the other 80%. They will most likely tell us that they do not know or care about strategy. They are doing what they are being told to do.
Tactical people should be used to do test solutions. The best strategy in the world falls apart if you cannot implement it at the tactical level. Yet, a marginal strategy has often been held together, at least temporarily, by the people who execute tactics flawlessly. For each process competency, there is someone exceptional in getting the job done. It is easy to find someone who has circumvented the blockages in the present system. Like a batting coach, that person is well equipped to show you what is wrong and how to fix it.
There is universal agreement today that the workplace is changing. The only disagreement is how. In his book, The Digital Economy, Tapscott speaks of "twelve corresponding themes", which will define the future of the workplace in a scenario he describes as: "New Economy, New Enterprise, New Economy." Thomas Koulopoulos, of the Delphi Group speaks of the organization of the future as "a federation". Birchall and Lyons, in Creating Tomorrow's Organization, are convinced that organizations will be equivalent to peer-to-peer networks of computers.
The CIO of the 21st Century will have the task of integrating tomorrow's workplace with the individual workers and the culture that they embody.
7. Equipping the workforce with new skills and knowledge
We must do everything we can to help the workforce gain the kind of skills and knowledge needed for the agency to be competitive. This strategy touches on the need to be a "learning organization," to recognize that the agency's success hinges on its ability to tap into and develop the knowledge of its people. Some students of organizational change even suggest that the organization's rate of learning might be the only sustainable competitive advantage (Senge and Stata, "The Leader's New Work: Building Learning Organizations" (Sloan Management Review, Fall 1990).
Traditionally we have done this through classroom instruction, seminars, and written material. Employees can also take advantage of a growing array of learning experiences on the Internet. For example, DoD's Electronic College of Process Innovation (ECPI) exemplifies the Internet opportunity for training and education at a fraction of the cost of classroom instruction. Students can access the college via the World Wide Web http://www.dtic.mil/c3i/. Or, via CD-ROM, one can select a topic from the subject catalogue, read about it, and take a course electronically.
The US Air Force (USAF) Research Laboratory at Wright Patterson Air Force Base has done some recent work in actually building software tools, known as assesstech, which can predict the ability of the organization to achieve its strategic goals, and suggest to management ways to increase the probability of success. This software can only be successful in the long run if it can learn both from the organization itself, and from the relevant technical body of knowledge which must support goal achievement. This software interacts with the project team and having learned the general skill level, makes recommendations to management about both what skills and knowledge does not exist and how to utilize those which do exist.
In manufacturing, it is now well accepted that you ask the machinist how to make his or her machine more efficient before the engineers redesign the factory. What the workers say is possible, combined with what the technology allows, must shape the vision and the strategy of the organization.
8. Designing agile business processes that apply best practices
It is said that the flexibility and agility of America's economy has allowed us to respond quickly to changing market needs and conditions, while the Japanese and German systems are embedded in old ways of doing business and consequently are slow to respond. We must reflect this same agility in our business processes and apply best practices. We must select the right projects to reengineer.
Our initial review must be designed to understand the dimensions of the challenge and to find ways to achieve world class performance. DoD has pioneered, and is a recognized leader, in applying methods to guide process reengineering projects that will help senior leaders design agile business processes and apply best business practices. These methods are available worldwide at the Electronic College for Process Innovation in the library at the web site mentioned earlier. This library contains hundreds of references, including the framework for managing process improvement and a benchmarking tutorial. In addition, the market place shows that at least one electronic version of a methodology navigator exists which supports a digital version of the framework for managing process improvement.
9. Building adaptive systems to leverage information technology
We must share our personal visions with our information systems engineers, including views on information flows and decision-support requirements. We must ensure that technologists design information systems to accommodate rapid change in the agency's business needs. Sometimes these improvements will be massive, requiring major change in the nature of information systems. Systems not designed to expect change would quickly become obsolete, hindering our ability to strive toward our performance goals.
Larry DeBoever, Deboever Architectures, Inc., is a recognized expert in designing adaptive systems. He says that the primary design goal for the 1990's and beyond is for leaders to develop adaptive systems. They must facilitate and accommodate change in workflows and allow application of "best practices." Process cycles must drive the information technology and infrastructure -- not the other way around.
Consider some examples. The number of hosts attached to the Internet continues to double every six months. With 20 million in operation at the end of 1997, by the Millenium, in theory every person in the United States of America could be one. How could this be possible? Moores' Law shows no sign of being repealed. What about software? Fortunately, the news is good here also. Commercially-off-the-shelf (COTS) software is matching hardware development. This is true in areas, from communications, to operating systems, to database management systems, to languages, to applications. Each of these areas is important to the CIO of the 21st Century. One example is COTS that actually writes other software called "Softlogic". It actually replaces proprietary hardware to perform a process control function. Here, software has already advanced to the point where it eliminates custom hardware in the most demanding industrial environments.
Software, while lasting or existing only for a short time and not physical, will likely never completely close the desire gap, however it is at the stage where it can satisfy the demands of most individuals at the most tactical level - the process. Other, on the near term horizon, software such as Machine User Interfaces (MUI) replacing GUIs, will actually get users involved in customizing the use of their personal process assistant.
10. Achieving and maintaining technology balance
Nearly 20 years ago, as part of its Integrated Computer Aided Manufacturing (ICAM) Program, the USAF had a serious technology integration problem. None of the Computer Aided Design (CAD) systems could talk to one another. The ICAM strategic vision required a seamless design process. Solutions of varying complexity were proposed. USAF went for the Initial Graphics Exchange Specification (IGES), which could be easily implemented with software provided as freeware by Boeing. IGES was supposed to have a life of 5 years.
As of this writing, IGES remains the simplest technology proposed and the most enduring. Like the integrated definition languages (IDEFs) various complex approaches have been tried and have failed to draw a following. While these modeling methodologies have their limitations, they are only now beginning to be replaced by an international standard. In the interim these methods remain the most popular methods worldwide for business process and data modeling. They are offered to the CIOs as proven modeling methodologies and as examples of the meaning of technology balance and as solutions.
Getting Started
First, we should share our personal vision of what our organization is capable of achieving and ask "Do they have a competitive advantage and can they sustain it"? Second, we must focus on results, thinking in terms of outputs and outcomes. They drive our efforts to reengineer agile processes and enable them with adaptive information technology. We must insist on visionary systems approaches and insist on adaptive systems architectures to support the vision. Third, we should work closely with our CIO and technical professionals. By working with them, we can more effectively manage information as a critical agency asset for sustaining competitive advantage.
The article focused on ten key strategies to help CIOs cope with explosive change in the workplace. It is believed that by adopting these strategies the CIOs will improve their organization's chances to prosper and survive through sustaining competitive advantage on into the 21st Century.
About the Authors:
Bill Beyer is a senior policy analyst at the Office of the Secretary of Defense. He is responsible for ITMRA policy development and implementation in DOD.
Dennis E. Wisnosky is President of Wizdom Systems and was named a "Hero of Manufacturing" by Fortune Magazine in 1997 for inventing Softlogic.
Michael S. Yoemans is Director of Functional Process Improvement in the Office of the Secretary of Defense. He directs the Business Process Reengineering and Data Management programs in DoD. He is heavily involved in implementing ITMRA.