What’s first? Org Strat or Tech Strat?

I’ve been talking recently with a couple of colleagues about the logical flow of strategy within large organizations. Our clients often have multiple strategic challenges to address, particularly when they have just brought on a new leader, merged or divested their organizations, or gone through other broader company changes that require a transformation of the technology group. Two big strategic needs tend to emerge: one around designing the right organization and the other around developing the right technology architecture. People who believe, as we do, that strategy projects must be limited to a few months, may be faced with a dilemma on which challenge to tackle first.

(By the way, this dilemma is really only relevant to large technology organizations, those with hundreds or thousands of employees. Small organizations can and should cover all these topics in an integrated strategy over a couple of months.)

So where should you start? With the organizational strategy or the technology strategy? Both strategies begin with the same step, assessing the business’s needs for technology. But then, the organizational strategy dives deep to understand the current organizational design, its capabilities, and its performance model while the technology strategy dives deep into identifying and assessing the different layers of technology architecture. When defining the future state and implementation plan, though, both lead back to the other. A technology strategy, both its design of its future state and its implementation plan for transitioning to that future state, is heavily limited or enabled by the organization driving it. A technology strategy that ignores the organization supporting it is likely to be impractical and end up on the shelf. An organizational strategy is often defined by the current state and planned direction of its technology architecture. Plans for existing or new technologies may affect which groups can be outsourced or how development groups should be aligned.

Even within our company, we have a variety of opinions on the right ordering of strategy and honestly, I could pretty easily debate technology or organization strategy as the best starting point. But overall, without considering specific nuances of a given situation, I believe in starting with organization. Here’s why:

1. You get payback sooner. You can design, plan and rollout a new organization in a few months, whereas designing, planning and rolling out a new architecture takes years.
2. The technology strategy cannot be executed without strong structures and capabilities. It is likely to end on the shelf.
3. Getting the right people into right roles builds towards a high performing organization that will make better technology decisions on an ongoing basis versus on a follow-the-architecture basis.

Of course, neither the technology strategy nor the organizational strategy will define a perfect end state. Nirvana will never be reached; both strategies will need to evolve interactively over the years. The organization will likely need to be reassessed once the technology architecture has shifted. Both will need to shift with broader business changes. Everything is linked. So we must pick a starting point, focus and make progress, and then pick the next highest impact area, focus and make progress and so on, always keeping in mind the significant interdependencies of the broader system.

Gartner’s influence on technology decision making

This is a great little piece: "Magic Quadrant Lawsuit: Would You Jump Off a Bridge If Gartner Says So?" putting Gartner, the analyst firm, in perspective. Thomas Wallgum compares following Gartner with following the in crowd in high school. His overall point is valid, if Gartner continues to be successful, they must be doing something right. Companies continue to follow their advice over the years so it at least must be directionally correct.

I’ve incorporated lots of Gartner (and Forrester, and CIO Exec Board, etc, etc) research over the years, into both organizational and technology strategies, sometimes at the request of our clients and sometimes at our suggestion. This research has never fundamentally changed our direction or brought forth a killer idea that changed our way of thinking about and solving a problem. That said, it has helped educate us and our clients on concepts, validate approaches, identify technologies to further investigate, etc. It has helped us fill out and back up our analysis but rarely drive to different recommendations.

And that’s how I’d recommend companies use Gartner. Not to decide their strategy but as one of many inputs.

Are we expecting too much out of CIOs?

I read this article on “The Three Types of CIOs: Are You and Your Company a Match?” earlier this week and while it isn’t really anything all that new within IT or even with business execs, it has spawned some interesting discussion with colleagues and clients that I thought I would share …

(If you don't want to read the article, the one sentence overview is that companies need to think about what type of CIO they need and can pick between Strategic, Transformational or Operational.)

First, are CIOs any different than other executives in their needs for different types of leadership? It seems to me that the three camps Curran describes could apply to CEOs as well as many other executive positions. I suppose you could attempt to make a case that IT organizational strategies change more often than their business strategies, requiring a new type of leader with each major shift, but I think I’d argue the opposite if forced to debate it …

Second, is this need for different types of CIOs at different times the reason that the average tenure of a CIO is only 18 months? If the answer to #1 is no and CIOs deal with more of a roller coaster than their businesses, then this could be a logical conclusion. But with my answer to #1, I’d say the reasons for their short tenure go back to other factors, including the average CIO’s capability gaps and the ongoing misunderstandings between IT organizations and their business partners.

Finally, is it unfair to expect a CIO to have all these capabilities? No! Leadership theory says that there is a natural preference for leadership, but if someone has reached the CIO level, and I’m not talking about an IT director of a small little organization here where you might have to make the tradeoff to afford someone or even find someone who would stay happy in the position, if they are working at a large company and responsible for both strategy and execution, they have to have all these qualities! Of course they can and should supplement themselves with strong lieutenants and/or consultants to help them, but a strong leader can seemingly effortlessly switch between these different modes and should be able to last more than 18 months. I think that’s core to the definition of a good leader, IT or otherwise.

One more note, one of the comments on the article referenced this State of the CIO study from the CIO Executive Council. If you are interested in this topic, it is definitely worth a skim. I found it particularly interesting that most Operational CIOs (what they call Function Heads) and Strategic CIOs were male but twice as many Transformational CIOs were women versus men.