Successful companies are creating
high-performance IT organizations in part by changing what people do. And they
are not only seeing compelling short-term results. These companies also are
laying the groundwork for long-term success by creating IT organizations that
are inherently agile—learning, growing and changing as the business
evolves.
By Stephen D. Page and Susan R. Pearson Outlook Journal, June 2004
Download this article (PDF, 772K)
PDF Help   It’s a tough time to be a CIO. Management
is demanding bold, sustainable change from the IT organization: reducing costs
by 30 percent, for example, or cutting unplanned downtime in half. Although
many leaders are meeting the challenge, these kinds of results do not come
easily.
The requisite scale of change—a complete re-creation of IT
capabilities—can accurately be described as “transformation.” And that demands
courage and skill. To transform IT capabilities, leaders are not just looking
at familiar technology issues (consolidating servers, simplifying
architectures, removing duplication); they also are focusing more intensely on
their people: who they are, where they are, what skills they have, and how
different groups can be brought together and synchronized for the greatest
overall benefit.
Indeed, at the heart of successful IT transformation is the
recognition that IT is not just a technology business but also a people
business—and a complex one. As the CIO of a major global company told us
recently, “Fixing the technology is hard, but changing what 2,000 IT employees
do is terrifying.”
Vision and Scope
Successful
companies are creating high-performance IT organizations in part by changing
what people do—helping them perform the right processes more efficiently and
effectively; supporting and sustaining them with the right organizational
structure, leader-ship, and the necessary knowledge and resources; and managing
skills and capabilities efficiently and cost-effectively across organizational
barriers. These companies are not only seeing compelling short-term results;
they also are laying the groundwork for long-term success by creating IT
organizations that are inherently agile—learning, growing and changing as the
business evolves.
Change initiatives at many IT organizations stumble because
of an incomplete vision and a limited scope. Some organizations “talk the talk”
about workforce change, but when one looks more closely at where management is
focused, it becomes clear that most IT investments are in technology
consolidation or deployment. Other programs often turn out to be little more
than a one-off realignment of IT capabilities, with a scope that cannot sustain
major change.
Other companies make the mistake of assuming that
transforming workforce performance is only about skills and training. Perhaps
their executives are focusing on concepts like “IT academies” or “skills
accreditation”—yet somehow the culture, behaviors and processes in the IT
organization remain fundamentally unchanged.
Transforming the IT workforce is not just about developing
skills—and especially not just technical skills. It’s clear that training will
be effective only as part of a more comprehensive program that addresses a
number of factors, including process change; new tools and systems; structure;
motivation through performance management and aligned reward systems; knowledge
management; and the development of leadership talent.
  The Accenture Workforce Performance Model
(see Box 1) indicates all the key drivers of individual, workforce and organizational
performance. Improving the performance of any workforce requires, first, a
critical appraisal of each of the drivers in the context of the workforce’s
particular performance environment. Then, relevant programs or interventions
can be designed to influence those drivers most effectively.
From the Top
Successful change
also requires effective leadership at the top, as well as strong leaders
throughout the workforce who not only challenge people to develop their skills
but also inspire them to do so. Developing leadership capability at all levels,
as well as setting clearly defined performance objectives and the criteria for
advancement, are all part of transforming the IT workforce.
But businesses that successfully transform their IT function
typically go further. They extend leadership development beyond the “steady
state” approach, which focuses primarily on control and management, to
transformational leadership, which needs to be visionary and inspired.
Leadership is important for infusing the transformation with
the necessary boldness and energy, always within the context of a clearly
articulated vision. The ability to inspire and engage teams, to show
consistency of purpose and to communicate the right messages at the right time
are all essential leadership skills. IT leaders must have a thorough
understanding of the business, ensuring that the IT investment is appropriately
apportioned to those areas where it will produce maximum benefit.
Having established the vision, objectives and scope of the
transformation, and with exceptional leadership in place, companies can then
embark on a comprehensive program of workforce transformation, which will
include the following key aspects.
Performance Goals Establish clear
performance goals for the IT organization that are aligned with the company’s
overall business objectives; align individual goals and the behaviors necessary
to reach them. One of the common complaints companies have with their IT
departments is that the function does not adequately support the organization’s
business goals. When this is the case, executives can’t just “teach” their way
out of the problem. Instead, they must begin by establishing rigorous, tangible
performance measures and then work back to the behaviors needed to reach those
metrics.
A realistic assessment of current performance, skills,
capabilities and behaviors is, of course, essential, not only for establishing
a baseline executives can use to track progress but also for determining where
investments must be focused.
 For example, at one communications
company (see Box 2), an
assessment of business needs and IT performance led the CEO and CIO to set
stretch goals in the areas of IT service stability, solution delivery and
business value. The CEO realized that people can become complacent if goals are
nebulous—“Increase customer orientation of IT staff!” By contrast, a precise,
tangible goal—“Reduce number of failed changes by 50 percent through bet-ter
teaming and quality of development”—will engage the staff’s commitment and
drive results.
Processes Define the working
processes that most effectively support the goals, and adjust the
organizational structure to make processes visible, measurable and
manageable. Executives may have the top people with the best skills, but
if those people are doing the wrong things, the IT organization won’t get very
far. To attain the new performance goals, people must be supported by the
processes most likely to lead to success—for them personally as well as for the
business as a whole.
High-performance IT organizations across all industries
share common process characteristics: Processes are clear; the link between
process and performance goals is well understood; and the performance of the
process is well measured and properly supported.
Sometimes a close look at the measures can raise warning
flags immediately. Take, for example, a major European bank, where one manager
was planning a party to celebrate the millionth call to the IT helpdesk. A nice
gesture, right? Perceptive senior managers thought otherwise. One million
unhappy users with one million technical problems, they felt, was not really
something to be celebrated.
The trouble here was that key IT processes—including problem
management, which detects root causes and reduces call volume—were unclear or
missing. The company established clear accountability for the problem
management process rather than for answering the phone a million times. The
party was canceled, but the IT department became significantly more effective.
Or consider the successful IT transformation program at
Orange, a leading wireless operator in the United Kingdom. After several years
of spectacular market growth, the company’s existing IT structures and
processes were insufficient to handle the sheer volume of customers. Just
fine-tuning a few things here and there was not going to create the change the
company needed. To become an intensely focused customer-service operation,
Orange had to transform its IT organization’s strategy, structure, processes
and culture.
The company’s transformation program concentrated on
delivering tangible improvements in organizational business performance with an
emphasis on strengthening the relationship between the IT teams and the rest of
the company. Then, with clear performance goals in mind, Orange invested in
strengthening its IT processes, building the right mix of skills and supporting
the new behaviors required for success. Orange now has a significantly stronger
IT workforce, one that is ready for the future and also operates at a lower
cost.
Skills and Competencies Identify
the skills and competencies that will lead to the right behaviors and outcomes,
and match the right skills, wherever they are located, to the tasks that need
to be performed. Now, with the focus of the organization on performance,
behaviors and the right processes, it makes sense to look at the competencies
and skills that will produce those behaviors. What do executives want from
their people now, and how is that different from what they needed before? What
behavioral characteristics, knowledge and skills are required?
Competency models are often seen as the answer. Yet although
they’re an important tool, too often they become theoretical documents instead
of real blueprints for success. Organizations often find it difficult to
complete such models at the needed level of detail, and then to maintain the
models over time as the performance environment changes.
Skills and competencies, as well as process frameworks, need
to be understood not only from within the IT organization but also from the
perspective of those on the business side of the company. Developing such an
understanding requires effective diagnostics, which can include face-to-face
interviews with employees and executives, skills assessments, broader surveys
of the workforce, a core values measurement tool, process performance
diagnostics and assessments of IT leadership.
This comprehensive analysis can then lead to a more detailed
blueprint for the transformed organization. It will summarize desired
competencies, behaviors and values, by role and responsibility; compare the
desired state to the existing situation; and define a program of activity for
areas where improvement can have the highest impact.
The analysis also can underpin the business case for change,
as well as sourcing strategies: Where is the company “skill rich” and “skill
poor”? What retraining or hiring must executives do to fill in gaps?
The most successful IT organizations are highly efficient at
matching the right skills to the right work (and at the right price) and then
managing processes across any structural barriers, such as sourcing, geographic
distribution and supplier relationships. IT development projects include a mix
of tasks that are highly repetitive, as well as tasks that are true “knowledge
work.” These latter tasks often are highly leveraged, so errors made during
their performance can have a serious negative impact on overall productivity.
Here is how process redesign and competency modeling
interacted to create a blueprint for success at Telenor, Norway’s leading
provider of telecommunications services. Company executives were looking to
transform Telenor’s function-based network system operation organization into
one that was process-based. The initiative would mean merging disparate systems
operations into a single location and deploying new technologies.
Telenor began by identifying the organizational, process and
behavioral changes needed to reduce costs and significantly improve the
effectiveness of its system operation workforce. Then, to achieve these
objectives, it created a new blueprint for the system operation organization,
built around redesigned business processes. Telenor developed the new
processes, determined the core competencies that would be required for each
process, and then defined the new roles to support each competency. From that
blueprint, the development team designed a new, tightly structured system
operation organization.
To ensure that employees focused on core activities, Telenor
created an organization in which each department within system operation had
its own core competency; employees whose skills complemented those competencies
were relocated to the appropriate departments. The result: Employees’ skills
and knowledge were put to use more effectively, and noncore activities were
reduced. The team also described the personal qualities necessary for the new
workforce: dynamic, flexible, results-oriented, full of initiative and focused
on satisfying customers’ needs.
Behaviors Develop, support and
reinforce those competencies and the right behaviors so they are sustained over
time. Once the performance and behavioral goals are set, the new
processes are in place and the competencies are defined, companies engaged in
IT workforce transformation must focus on the incentive and reward structures,
as well as the learning programs needed to reinforce and sustain the desired
new behaviors.
Redesigned processes and the alignment of skills and
competencies will increase the likelihood that the workforce will perform in
the new ways required. Just as essential, however, is performance management
that clearly defines goals and provides feedback on how well those goals are
being achieved, at an individual level as well as at a team level. If the IT
organization is truly to be transformed, team-based performance measures and
reward structures must be part of the mix.
Appropriate incentive plans and reward structures then
encourage the right behaviors. Effective performance management helps identify
high performers who could be stretched further, as well as low performers who
need further development or should be redeployed.
Ideally, staff at all levels will have a tangible stake in
delivering the best possible service to the business. For example, when
Prudential co-sourced its IT operations with Accenture, the giant UK insurer
tied its reward system to specific service level agreements. Under this plan,
everyone in IT services was rewarded if service levels were met.
Rewards work well as short-term incentives. Career
development and management is vital to longer-range incentives—creating and
sustaining commitment on the part of the workforce.
For example, a critical component of the IT workforce
transformation at AXA Australia, a subsidiary of the Paris-based global
financial services company, was the introduction of a career development model
that provided a framework for skills development and career progression for
employees within the IT organization. The model enabled individuals to manage
their careers by defining performance requirements, roles and potential career
paths. It also gave managers a tool to make sure the competencies of the people
were aligned with the company’s business needs.
Learning Make change sustainable
by creating access to the right expertise, linked to clear business
goals. Focused learning supported by ready access to knowledge and
expertise is critical to helping workers perform at high levels of competency
more rapidly, and for sustaining that high performance.
Some CIOs favor an IT academy approach that bundles learning
content from internal and external sources, and provides a more comprehensive
curriculum at all levels through blended e-learning and instructor-led
training. An IT academy can also include the delivery of learning to those
outside the IT organization. The success of these learning initiatives depends
on clearly linking learning to the right business outcomes.
An equally important part of the mix is the development of a
collaborative, knowledge-sharing environment, enabled by new tools and
technologies that pull all the elements of the virtuous performance circle
together for individuals on their desktops. These solutions combine portal
technologies, expert searches, e-learning, online collaboration tools, and
visibility-to-performance metrics with an appropriate content infrastructure.
As IT projects increasingly combine teams working across
time zones, effective tools for collaboration and project management become
increasingly essential. The success of a portal, however, depends on focusing
tightly on the right business outcomes, rather than looking at technology for
its own sake.
In the end, IT workforce transformation is about culture
change—changing what the IT workforce does and how it does it. But leaders of
high-performance organizations know that culture change is not, in fact,
tackled straight on but is the result of the other factors we’ve outlined here:
courageous and insightful leadership; bold but tangible goals; new processes,
tools and structures; sourcing strategies that assign the best skills at the
right price to the right work; new behaviors; and the competencies, rewards and
enablement programs to sustain a transformation.
 About the Authors Stephen D.
Page, a partner in the Corporate Strategy service line, leads the
Accenture Strategic Information
Technology Effectiveness group in Europe, the Middle East and Africa.
Working across a wide range of industries, his primary role is to shape and
launch transformational change—especially for organizations in which IT is a
critical strategic element—and to focus and achieve strategic value from IT.
Dr. Page is based in London.
Susan R. Pearson is a partner in the
Accenture Human Performance service
line, where she leads the company’s Workforce Transformation group. Dr. Pearson
has extensive experience, at both the corporate and operating levels, in
managing the human factors involved in large-scale organizational change. She
is based in Reston, Virginia.
For more information, please
contact us.
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