Monday, April 1, 2013

Any IT Organization Structure Is Ephemeral

In the process of introducing a new organization change a few years ago. One of my staff took me aside and said she understood why I had to make the changes, but she didn't really like the affect it had on her. I told her not to worry, because no IT organization structure is permanent. If she didn't like our current organization, I asked her to be patient and wait for the new one. I was already thinking about the next organization change before I had completed the latest one.

Organization structure exists to solve a problem. Once that problem is solved, it is probably time to change the organization again because there are new problems and new opportunities. The shelf life of any major effective IT organization structure is two years. Anything beyond a couple of years means IT has stagnated. External changes in the form of new technologies, or internal changes driven by new problems have arisen and the IT organization structure has to change to survive.

Think about implementing an ERP system. The sheer scope of the project typically consumes the full attention of everyone in the IT organization. The wise CIO creates an organization structure dedicated to ensuring the success of the project. The ERP becomes priority #1 by virtue of the size and impact of the implementation.

But once the ERP is implemented, the IT organization's attention has to shift. Expectations of IT change from the implementation of one big project to a plethora of follow-on projects. The organization's emphasis shifts from the management of a big bang strategic project to the management of a portfolio of tactical projects. To succeed with the new emphasis, the perceptive CIO creates a new organization structure.

This constant change approach can be difficult for some external groups to understand. For example, HR never likes organization changes. Not because it means more work for them, but because it means turmoil in the institution. Their job is to promote stability and constant IT change does not fit the typical HR model. Across the organization, most departments are not compelled to change nearly as rapidly as the IT department. External and internal change vectors are less common in departments like accounting or procurement.

But the fundamental rules of IT change constantly. Working in IT is like working in an accounting world where the generally accepted accounting principles (GAAP) change every year. If GAAP changed every couple of years in the real world, then the accounting department would have to re-organize much more often. That is what makes IT organization changes so special. Our rules change almost daily. We can't afford to wait. The world of technology passes us by if we don't have the right people focusing on the right things. We get stale, old, and unwanted pretty quickly if we aren't structured to take advantage of the latest and greatest technologies.

Value generation from new systems-based processes or market-grabbing technology-driven innovation can only come from nimble IT organizations. Agility in IT comes from a simple willingness to change everything, especially the organization structure. Organizations get value from information systems organization that can turn on a dime.

The external IT environment has already changed from the time you started reading this article. Have you thought about what that means to your IT department's structure? If you aren't already thinking about your next IT organization change you should be thinking about your next job ... maybe in accounting?


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