Defining the roles of IT in transformation programs
Matthias Gröbner is Project Manager in the Financial Services Competence Center
Although IT transformation programs are usually driven by business concerns, their success depends very much on IT. In their column, Matthias Gröbner and Kirill Perfiliev of Roland Berger describe IT involvement, requirements management and implementation monitoring.
Whether it's a matter of changing corporate structures, realizing synergies, harmonization or improving efficiency – most IT transformation programs are driven by business concerns. However, their success depends very much on IT, since targeted changes in corporate structures and processes are only possible with IT's support. So what role should IT play within the program structure to make its appropriate contribution? On the one hand, establishing a cross-sectional IT working group has already become recognized as best practice; on the other, the exact role definition of this cross-sectional IT working group varies from program to program.
In principle, IT, as a contractor for transformation projects, should be organizationally and procedurally embedded in the program structure as follows:
In this way the IT function covers not only integration, but also content, which gives it responsibility for implementation. To be able to effectively carry out requirements management, all the people involved must agree to the defined processes and prioritization criteria. This is an important condition, because departments often bring IT requirements into transformation programs which cannot be causally attributed to the program. The requirements-management process must carefully filter out IT preferences of the "what-we-always-wanted" variety.
It helps in this context to set up a two-stage requirements-management process. The first stage prioritizes regulatory requirements, day-1 needs (establishing the operational ability to act) and requirements with especially good business cases. In the second phase, further requirements are then examined with the aim of realizing various synergies. To make sure that feasibility is successfully documented, assessed and reviewed, however, the following factors must be taken into consideration in this two-stage process:
Whether it's a matter of changing corporate structures, realizing synergies, harmonization or improving efficiency – most IT transformation programs are driven by business concerns. However, their success depends very much on IT, since targeted changes in corporate structures and processes are only possible with IT's support. So what role should IT play within the program structure to make its appropriate contribution? On the one hand, establishing a cross-sectional IT working group has already become recognized as best practice; on the other, the exact role definition of this cross-sectional IT working group varies from program to program.
In principle, IT, as a contractor for transformation projects, should be organizationally and procedurally embedded in the program structure as follows:
- Organizationally as a cross-sectional group with interfaces to the functional working groups in which the target structure of the business functions is designed and implemented. In addition to the interfaces to the functional working groups, the direct reporting route to the program management is also important to ensure that the current status of the IT-related subjects is regularly reported and, if necessary, in order to use the program management for rapid escalation.
- Procedurally as the designer, responsible manager and operational driver of the two key processes: requirements management and implementation monitoring.
In this way the IT function covers not only integration, but also content, which gives it responsibility for implementation. To be able to effectively carry out requirements management, all the people involved must agree to the defined processes and prioritization criteria. This is an important condition, because departments often bring IT requirements into transformation programs which cannot be causally attributed to the program. The requirements-management process must carefully filter out IT preferences of the "what-we-always-wanted" variety.
It helps in this context to set up a two-stage requirements-management process. The first stage prioritizes regulatory requirements, day-1 needs (establishing the operational ability to act) and requirements with especially good business cases. In the second phase, further requirements are then examined with the aim of realizing various synergies. To make sure that feasibility is successfully documented, assessed and reviewed, however, the following factors must be taken into consideration in this two-stage process:
- Clearly defined roles at the interfaces between the functional working groups and IT are important. In particular, the demand role within the functional working groups should be clearly defined.
- The restrictions on time and capacity must be systematically taken into consideration in the planning of the requirements.
- The quality assurance of requirements needs to be carried out early and thoroughly. This reduces the risk of unclear project orders and definitions. In this context, the quality assurance of requirements also includes precise resource planning, because companies often underestimate the true demands that IT projects make on departmental resources. The use of external IT experts should be precisely planned and their availability checked.
- Standardization of inputs and outcomes. The minimum requirement here is the uniform use of templates. Furthermore, a pragmatic use of tools should be obligatory in larger programs.
- Strict compliance with deadlines in the requirements-management process (especially deadlines for submitting requirements) is a key factor for ensuring the stability of resource and budget planning in the entire program.
Kirill Perfiliev is Senior Consultant in the InfoCom Competence Center
Parallel to documenting and assessing requirements, IT must conduct an appraisal and inventory audit of all ongoing projects in order to avoid redundancies and target conflicts with the transformation program. In this context, projects that are somehow in functional or technical conflict with the transformation program must be resolutely halted or rescheduled.
The outcome of requirements management is more than just an IT project portfolio released for implementation. It is also the emergence of a network between all the parties involved: technical contractors, project managers and supervising bodies. This lays the foundation for effective and constructive cooperation in the later implementation stage.
Implementation control
Once the IT project portfolio has been defined and the budgets approved, the implementation of the transformation process begins. As in the case of other IT projects, budget, deadline and quality risks are monitored here, too. A holistic implementation control of IT projects is required to ensure that risk monitoring is adequate within the framework of the transformation program. This must, however, go beyond monitoring alone and also concern itself with the content of the projects.
The IT cross-sectional group should also be the process driver in the implementation phase. Ideally, the same contacts should be maintained here that were already established during requirements management. This is the best way to avoid know-how losses and unnecessary risks. Moreover, the established contacts can ensure cross-project control of content during implementation.
Control here means not only monitoring the schedule, budget and quality; the content of activities and interrelations should also be coordinated. A comprehensive overview of the transformation project is necessary in this context, because only then is it possible to guarantee the quality assurance of the project plans and outcomes, and to identify and monitor any project risks at an early stage.
A weekly meeting with the implementation and project managers, for example, can be a suitable tool for this. In this context the responsible members of staff should not only discuss classic KPIs, but also look at content, staff and political aspects, because the interests of different stakeholders in transformation programs are often in conflict with each other. Resistance and lack of acceptance of the strategic decisions often do not become visible until the implementation phase. Here, cross-sectional control's task is to exert a moderating influence, to encourage discussion and coordination between departments and IT – and to incorporate escalation bodies, particularly project-steering committees, where necessary.
Another advantage of regular exchanges between implementation control and project management is a more precise understanding of the development of indicators that goes beyond pure reporting. For example, capacity commitments that have not been met can be quickly identified in this way. After all, such failings can quickly lead to "creeping milestone decay." Strict enforcement of project-management methodology and an early involvement of the escalation bodies is therefore an important prerequisite for achieving the project objectives.
Conclusion
IT can make a valuable contribution to the success of the overall project by ensuring its effective cross-sectional involvement in the management of the transformation programs. Interfaces and the distribution of tasks with functional working groups must be clearly defined in this context. Requirements management across working groups must cover and prioritize all IT requirements centrally. Moreover, the implementation control of the IT projects must not be reduced to the simple monitoring of data and facts; rather it must also get very much involved in content. Unimpeded access to the functional working groups is useful here in order to encourage coordination between departments and IT.
The outcome of requirements management is more than just an IT project portfolio released for implementation. It is also the emergence of a network between all the parties involved: technical contractors, project managers and supervising bodies. This lays the foundation for effective and constructive cooperation in the later implementation stage.
Implementation control
Once the IT project portfolio has been defined and the budgets approved, the implementation of the transformation process begins. As in the case of other IT projects, budget, deadline and quality risks are monitored here, too. A holistic implementation control of IT projects is required to ensure that risk monitoring is adequate within the framework of the transformation program. This must, however, go beyond monitoring alone and also concern itself with the content of the projects.
The IT cross-sectional group should also be the process driver in the implementation phase. Ideally, the same contacts should be maintained here that were already established during requirements management. This is the best way to avoid know-how losses and unnecessary risks. Moreover, the established contacts can ensure cross-project control of content during implementation.
Control here means not only monitoring the schedule, budget and quality; the content of activities and interrelations should also be coordinated. A comprehensive overview of the transformation project is necessary in this context, because only then is it possible to guarantee the quality assurance of the project plans and outcomes, and to identify and monitor any project risks at an early stage.
A weekly meeting with the implementation and project managers, for example, can be a suitable tool for this. In this context the responsible members of staff should not only discuss classic KPIs, but also look at content, staff and political aspects, because the interests of different stakeholders in transformation programs are often in conflict with each other. Resistance and lack of acceptance of the strategic decisions often do not become visible until the implementation phase. Here, cross-sectional control's task is to exert a moderating influence, to encourage discussion and coordination between departments and IT – and to incorporate escalation bodies, particularly project-steering committees, where necessary.
Another advantage of regular exchanges between implementation control and project management is a more precise understanding of the development of indicators that goes beyond pure reporting. For example, capacity commitments that have not been met can be quickly identified in this way. After all, such failings can quickly lead to "creeping milestone decay." Strict enforcement of project-management methodology and an early involvement of the escalation bodies is therefore an important prerequisite for achieving the project objectives.
Conclusion
IT can make a valuable contribution to the success of the overall project by ensuring its effective cross-sectional involvement in the management of the transformation programs. Interfaces and the distribution of tasks with functional working groups must be clearly defined in this context. Requirements management across working groups must cover and prioritize all IT requirements centrally. Moreover, the implementation control of the IT projects must not be reduced to the simple monitoring of data and facts; rather it must also get very much involved in content. Unimpeded access to the functional working groups is useful here in order to encourage coordination between departments and IT.
CIO expert column
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