As we progress through the digital age, the pace of change is increasing and technology advancements are opening up new opportunities for those organisations that are able to respond and adapt. In this increasingly competitive environment, organisations are under even greater pressure to operate efficiently, constrain costs and meet budgetary demands. IT departments need to enable the businesses they support to meet these challenges. To do this they must look for opportunities to become efficient, agile and flexible – and simplification of technology and process is a priority. For IT teams, simplification is about reviewing the current position across technology, organisation and processes, and identifying opportunities to deliver more efficient and effective solutions that achieve increased value to the business. The starting point for all simplification initiatives should be a focus on outcomes and the benefits that will be delivered to the business. We focus on two broad categories of simplification activity driven by IT.
Simplification of IT
Many organisations have complexity throughout their IT environment with examples of duplication, waste and poor performance across applications, infrastructure, and processes. For these organisations, simplification initiatives (such as application rationalisation, operating model improvement, technology consolidation and contract renegotiation), offer opportunities to deliver value to the business through reduced operating costs and more stable, better performing IT services.
IT-enabled business simplification
while improving service stability and reducing operating costs will have a direct impact on the business, these benefits can be modest compared with the benefits that can be realised through IT-enabled business change. Through shifting to new models of operation, transforming process and adopting new technologies such as cloud services, IT can provide flexible, responsive services that enable the business to operate in different ways and drive competitive advantage. IT teams needs to look at both types of simplification, and there are a number of critical considerations that apply.
Start at the end
Any change requires a clearly defined target and a focus on outcomes. Simplification initiatives should be driven by a well-articulated vision that is understood and shared among the team.
Understand the value stream
Much of the complexity in IT systems and processes has developed as a result of making technology-centric decisions and silo thinking. Changes to IT systems or services should be planned based on a clear understanding of the purpose of the services and the business outcomes that they enable.
Understand the status quo
Without a clear, documented understanding of the current systems or processes, there is no baseline for simplification. Listening to the users, conducting a health check of the current landscape and analysing data about current performance are key components of getting this baseline understanding.
Simplification must be measurable
Data is essential to identifying opportunities for improvement and measuring the results. Planning changes that deliver measurable improvements for the business is an important part of the simplification process. These measures are equally important whether the simplification in question is consolidation of contracts to reduce operating costs or adopting a new SaaS service that will reduce time and effort associated with a specific business process.
Simple is not superficial
There is a common misconception that simplification removes the need for detailed planning. Effective simplification initiatives involve a data-driven approach to identifying opportunities and undertaking iterative planning, testing and implementation cycles that result in controlled and measureable progress towards the defined target.
There is no single magic methodology
IT organisations must develop a whole toolkit for simplification that contains a number of approaches and techniques which can be applied as appropriate to the situation. Organisational capability must be enhanced so that team members are confident in assessing opportunities and applying the most appropriate approach, from a selection of Sigma, Lean, Agile, and change management tools, as well as total cost of ownership (TCO) analysis, service maturity assessments, and technology health checks.
Simplification is everyone’s job
While there will continue to be requirements for formal simplification initiatives, the key to continuous improvement is making simplification everyone’s responsibility. This means empowering all members of the team to drive change, introducing simplification tools and capability across the whole IT organisation, embracing disruption, and encouraging curiosity in the pursuit of perfection.
Mason Advisory can help you to identify, design, develop and roll out initiatives that will establish sustainable simplification in your organisation.