Challenges in landing digital change are often a sign of structural issues with the IT operating model.
Is your IT operating model still fit for purpose?
How are the digital services on which your organisation relies delivered and managed? The answer is probably longer than you’d expect and will likely include people, organisational design, processes and workflow, governance frameworks, supplier relationships and commercial structures. This is what makes up your IT operating model.
Why does your IT operating model matter now more than ever before?
There are four key aspects of the IT operating model that are particularly important for digital change: mindset, risk culture, delivery method and engineering model.
- Mindset (the way the IT organisation thinks about how it creates value) matters because it is often strongly correlated with resistance to ‘business driven’ digital change and ability to collaborate beyond IT.
- Risk culture (values, beliefs, attitudes and norms pertaining to risk) strongly influences support for disruptive digital change and willingness to experiment and innovate.
- Delivery method (the methodology used to orchestrate and govern the creation of new digital capabilities) shapes cost, risk and time to market.
- Engineering model (how the engineering functions at the core of IT organisations are structured) has a significant impact on the technology options available and the long-term value of investment in digital change.
What kind of IT operating model works well for digital change?
While there is no silver bullet or ‘one size fits all’ solution, shaping your IT operating model in specific ways is likely to reduce the cost, risk and time to market of digital change, while also maximising long-term benefits, enabling your organisation to take advantage of new technologies and simplifying digital change execution.
- Mindset: centred on Business outcomes over IT outputs
Technologists can think about how they create value, and their role within organisations, in a variety of ways. For digital change, an IT mindset oriented around collaborating across the enterprise to create and manage digital services and capabilities that enable business outcomes is helpful. On the other hand, a siloed technology-first paradigm, particularly one that articulates IT value through a system support lens, can make IT-business collaboration challenging. A mindset that enables a genuine partnership between IT and business is essential.
- Risk Culture: forward looking and risk-taking over reactive and risk-averse
Digital change can be highly disruptive to IT organisations, requiring innovation and adoption of unfamiliar approaches and technologies. Inevitably, this involves taking on financial, operational and technical risk. An IT risk culture that emphasises horizon scanning to identify future risks, encourages responsible risk-taking and rewards careful risk management will support digital change. Alternatively, an IT organisation that is highly risk sensitive, that has a short-term tactical planning horizon, or that consistently prioritises mitigation over management, will resist digital change as a source of (always undesirable) risk.
- Delivery: agile-first, product-centric over waterfall-only, project-based
Successful digital change requires IT organisations with the right delivery model to implement it. The technologies associated with most digital change programmes (e.g., cloud-native, X as-as-Service, big data, automation) are usually best implemented through delivery models that operate according to Agile principles, rather than waterfall methodologies, and are structured as product management organisations, rather than project delivery functions. Why? Firstly, digital change usually cuts across multiple domains creating complexity and ambiguity that is best resolved through an iterative approach. Secondly, maximising return on investment in digital change requires seamless, intense collaboration between technologists and business experts which is easiest to achieve through product teams.
- Engineering: devOps structure, CICD practices over functional silos, stage-gated workflow
Maximising the long-term value of investment in digital change requires IT organisations with the right approach to managing and enhancing digital capabilities. In practice, this means engineering functions moving to a DevOps-based organisation design (whereby development and operational engineering teams which were traditionally siloed are brought together at the delivery level) to enable the adoption of Continuous Integration, Continuous Development/Deployment practices (which involves tools and ways of working that radically reduce the time and effort it takes to deploy new capabilities). This is essential because it enables organisations to realise one of the principle long-term benefits of modern technologies: system changes, enhancements and scaling are quick, simple and easy to achieve, enabling IT to respond to changing business requirements in near real-time at minimal cost.
Do you need change expertise?
Project One has been helping organisations achieve their digital transformation priorities for 25 years. Supporting leadership teams shape, enable and deliver complex digital change. Want to make digital transformation easier? We can help.
