What does a newly hired CIO do to ensure that basic services are delivered exceptionally well. As part of my research for my new book – The Strategic CIO I recently spoke to one such person who was selected for the CIO role at a multi-billion dollar insurance company. This strategic CIO, with a successful CIO and business track record, followed a process that is worthy of sharing with others. Before we discuss the process let’s review why achieving success for this critical step is important for CIO’s who want become a strategic business partner with C-level peers in developing information-based solutions for the company
In a previous AITS article – Five Critical Steps to Become a Strategic CIO I identified the five key steps for a CIO to successfully transform into a Strategic IT organization. As a summary the five are:
- Deliver Basic Services Exceptionally Well
- Understand the Business & Competitive Environment
- Upskill IT/Business Personnel through Cross Training
- Focus Initiatives on Improving Margin (Sales/Cost)
- Leverage Technologies Strategically
The first of these – Deliver Basic Services Exceptionally Well – is the key to building a trust-based relationship with the business. Every CIOs recognizes that operational stability is a key necessity to maintaining daily business activities as well as a stepping stone to partnering with C-level peers to focus on initiatives that improve business outcomes. But to even play in this arena the CIO and the IT organization needs to deliver basic services exceptionally well. Let’s explore this further.
When you plug a cord into an electric outlet you expect the electric connection to work all the time. Coffee makers prepare your morning java. Toasters crisp your bread or bagel or muffin. You never expect any service disruption from you electricity provider. The same is true when business personnel perform their jobs Each day personnel all over the globe enter customer orders, check inventory status, analyze monthly sales, measure manufacturing performance, analyze sales metrics, prepare monthly budgets. There is very little tolerance for any disruptions to email, telephony, and internet services. The list goes on and on.
We all recognize today that business runs on IT. And as a result we expect basic services to always be operationally functional with an almost zero tolerance for any disruption. Unless the CIO and the IT organization can achieve this level of service they will never have the opportunity to work with business peers in a collaborative way to jointly focus on initiatives that will drive successful business outcomes.
Now let’s explore how the CIO of a multi-billion dollar insurance company improved the delivery of basic services to an exceptional level.
The new CIO told me about his interview process with members of the Board. He said that the number one issue were the numerous outages of basic services supplied by IT to the organization (There were two others; lack of understanding what IT does and why IT costs so much but these are subjects for another article).
During the first 100 days the CIO developed his plan to become a strategic IT organization. The first step in his plan was to dramatically improve the delivery of services delivered to the business.
The objectives he wanted to achieve were:
- Identify the business services and supporting technical services used by the business and its customers in the creation and delivery of products and services across the enterprise value chain.
- Document the organizations, within the company and entire value chain, that utilize the business services.
- Assess the value that the business service provides to the enterprise from the view of the business user.
- Develop a single list of business services based upon their value to the business (high value to low value)
- Develop a Plan to optimize the delivery for business services for the Enterprise
- Implement a communication plan to monitor, improve, and communicate the progress of the plan using co-developed metrics
To accomplish the above 5 objectives he developed the following seven step process.
1. Meet with Business Leaders to Develop a List of Business Services Required by the Business Unit (after meeting with each C-Level Executive and key staff 154 business services were identified)
- The CIO met with every C-Level executive and their key staff personnel. As part of the meeting he asked each person to identify the following:
- The key business services required by the business unit in the creation and delivery of products and services to customers across the entire enterprise value chain
- The associated business processes that utilize each business service in the creation and delivery of products and services to customer across the enterprise value chain.
2. Prioritize the Business Services Based Upon the Business Value Delivered to the Enterprise.
As part of the meetings the CIO asked each person to identify, using their own business language, the following:
- Which organizations interact with you in utilizing these business services for the creation and support of the products and services your customers purchase or your business colleagues.
- Prioritize the business services in an order that represents, from high to low, the services that are the most important in the creation of products and services for customers.
- The level of service provided by IT for each service on a scale of 1 to 10 (1 for Multiple Outages and Business Disruptions and 10 for Exceptional Delivery of Services)
- The level of service required by the Business Unit for each of the business services they use (a scale representing service level agreement metrics)
3. Analyze Responses and Sort by Priority for Each Business Unit
The CIO then developed a table that included a set of information based upon his meetings. The business unit VP first was asked to identify the business services they utilized in their organizations. And for each business service the following additional key data elements were identified:
- IT Service Owner (this was completed by IT)
- Business Processes utilizing each Business Service
- Level of Service Received (scale of 1-10)
- Other organizations using this service
- Priority list for the services based upon the value created for the enterprise
4. Rationalize the Department Priority Lists into a Single Enterprise-Wide Priority List
When the CIO met with each business unit VP and key staff they prioritized the importance of each business service (item 3e above). The CIO needed to rationalize the priority list for each business unit into a single priority list for the entire enterprise. How did he do it? Read on to find out.
A. The CIO developed an simple excel file that included the following set of rows and columns.
a. Business Services: The rows identified each of the business services identified in step 3 above (Analyze Responses and Sort by Priority for Each Business Unit) as well as additional data.
b. Business Processes: The first set of columns reflected the business processes identified by the business unit VP’s that mapped to each business service
c) Organizational Units Utilizing Each Business Service. An additional set of columns, to the right of the columns identifying the business processes, was a set of columns which listed the organizational units for the company;
d) Business Value: a column to the right of each business unit indicated the value (on a scale of 1-10 with 1 being high value)for each business service the organization identified
B. As the CIO populated the columns for each business service he could identify the following:
1) The list of business services (in the first column).
2) The organization(s) that utilized the service ( set of columns for each Business Service that contain each organization name)
3) The associated business process(es) that utilized the service (set of columns to the right of item 2 above -organization(s) that utilized the service)
4) The business value for each business service identified by each business unit VP
C. The CIO then rationalized the list to reflect an overall enterprise list of business services and the associated information (in the columns to the right of each business service) and reviewed it with each Business Unit VP to gain consensus.
5. Share the List with IT Directors and Capture their Input as well as the list of Technical Services that support Each Business Service.
The CIO met with his direct reports (and subsequently with all the key personnel in IT. The group totaled about 50 people). His objectives were to:
- Share with his direct reports the information gathered from each of the business unit VP’s and their staffs
- Identify the IT technical services required to support each of the business services (e.g. data center services, security, network, desktop, help desk)
-The CIO prepared a Business Services / Technical Services Matrix that mapped each business service to the corresponding supporting Technical Services
-In addition to capturing this information the CIO wanted to change the way IT personnel think about the work they do each day. It’s not about writing code. It’s about the business use for the IT applications, projects, and supporting activities each IT worker does each day
6. Develop a Work Plan to Optimize Delivery Performance of the top 50 Business Services (this list of top 50, out of the list of 154 business services, represented the business services that represented the highest business value to the company)
-The CIO created a “tiger team” comprised of 8 key IT staff personnel. The team developed a six month plan to improve service delivery for the business services identified by the business unit VP’s.
-The plan focused on the key service based upon the priority rating identified by each of the business unit VP’s
- When the Tiger Team completed the plan the CEO and Tiger Team met with each business unit VP and key staff members to review the plan and data each business unit provided. A final scrubbing of data based upon some additional inputs and modifications were made prior to gaining consensus from each of the business unit VP’s.
-The CIO and each of the business unit VP’s then met with the CEO to review the plan and gain consensus by the group to proceed
7. Monitor, Improve, Communicate
The CIO recognized that to really achieve the success desired for any key strategic project you have to monitor, improve, and communicate the project status on a regular basis. So to ensure that communication was constant, consistent, and clear the CIO developed a 360 degree communication plan.
- The IT organization used an electronic survey tool to capture and measure delivery performance for each of the business services and created a weekly metrics report.
- Each week the CIO met with the IT Tiger Team managing the business services improvement project to monitor status, deal with issues, and tweak the plan.
- Each week the CIO would meet with business unit VP’s, via WebEx Conference, to update them on the status of the project.
- Each month the CIO would update the CEO on the status of the project
Over a period of six months delivery of services to the business units dramatically improved for the top 50 business services. Business unit VP’s began to vocally praise the role of IT in improving services delivery. But more importantly the CIO now had the opportunity to dialogue with his C-Level peers to discuss how information technology can address the business issues and challenges that needed to be addressed in improving business performance.
Take a look at your own company and have your business peers asses the value of the delivery of the basic business services. You’ll find the results interesting and rewarding.
Phil Weinzimer is president of Strategere Consulting working with clients to develop business and IT strategies that focus on achieving business outcomes. Previously Mr. Weinzimer was Managing Principal-Professional Services for IT Business Management at BMC Software. He has also held Managing Principal positions in the Professional Services organizations for ITM Software, CAI, and Sapient.
Mr. Weinzimer has written a book concerning customer value entitled “Getting IT Right: Creating Customer Value for Market Leadership” and has a forthcoming book, “The Strategic CIO: Creating Customer Value, Increasing Revenue, Enhancing Shareholder Wealth”, will be available in 2013.
Mr. Weinzimer can be contacted at email@example.com