Before embarking on an IT Rationalization project, your team should establish some basic groundwork for a successful project. Ensuring that objectives and scope are clearly stated, executive sponsorship engaged, and communications among the stakeholders is open and frequent. Client teams must be experienced, have authority to make decisions and should be dedicated to the project.
Decision processes and decision rights must be defined, and a reasonable timeline must be established, communicated and monitored.
- It is crucial to identify the stakeholders and understand what they want most from an IT Rationalization. This can entail consolidation of data center hardware, system software, communications networks, desk top computers, data center tools, end-user computing tools, and application software., as well as functional outsourcing of application development and/or maintenance and support activities.
- Without first establishing the business foundations, IT Rationalization will be driven by inventory of existing systems rather than by aligning IT capabilities to business needs. This foretells future problems during implementation. Just when the change is about to be implemented, business units or other internal groups may claim they were not adequately consulted or the solution is “not for them” and they may try to opt out.
- Establish which organizational, functional and governance aspects of the current state support future goals and which do not. Focus on understanding the issues driving the assessment, the IT strategy and how well it aligns with the business strategy, and any constraints that exist, including regulatory, environment and security or privacy issues.
- A successful rationalization project includes both a functional approach and a technical approach.
- The functional approach describes what business processes the applications actually automate, and the technical approach describes how the applications are configured and operated. If only one of these approaches is used, a narrow view of the application portfolio will be created, which can lead to decisions based on incomplete or missing information.
- Pay special attention to recent mergers, acquisitions, divestitures, and joint ventures.
- These situations present the greatest opportunity for positive change but also carry the risk of business disruption if changes are not made thoughtfully.
Application Portfolio Assessment
Enabling Technologies Assessment
- Staff familiarization and training is an important consideration when rationalizing any application portfolio. The impact of rationalization will undoubtedly have ramifications to the organization, and must be taken into consideration.
- The assessment of an IT Portfolio is an iterative process. Information gleaned in later steps will require revisiting previous steps. This process is a healthy process of discovery and adjustment that increases the quality of the assessment results.
- Assessment of enabling technologies will require a great deal of user interaction. It is critical to involve a multi-discipline team of stakeholders in the review of technologies, avoiding assumptions and recommendations made in a vacuum.
- The system software track covers operating system software, networking software, systems management tools, storage software, database management ERPs and teleprocessing monitors, data dictionaries, reporting tools, web technologies, end-user tools, code libraries, compilers, productivity tools imaging and workflow management systems, etc. The emphasis is on how work comes into the IT organization and how it goes out.
- The hardware track covers end user desktops, data center/hosting, storage devices and telecommunications equipment. We focus on traditional capacity performance, utilization and consumption patterns along with ability to scale up and down. This aspect is important because changes to applications usually drive changes to hardware.
- Sometimes, making only those changes that are necessary to enable the Target Delivery Model may be most prudent. It is crucial to follow a theme, such as “greater centralization” or “more local control”, so that decisions follow a consistent goal set.
- Proposed organizational changes sometimes create resistance-based organizational politics. Political issues need to be recognized and dealt with directly. Deferring or side-stepping these issues can adversely affect the organization’s ability to implement and maintain the transformed state.
- Since IT affects every area of the organization, it is wise to include the broadest practical definition of “users” and “stakeholders.” Too narrow a definition in early project phases is often a false economy that can result in critical delays and re-work in later project phases.
- Culture match is key to getting this phase right because this phase is the most opportune time for personal consequences to seep into the decision making process. Leaders naturally worry about how their own performance will be measured and monitored, and they care about the effect of change on their employees.
IT Organization Realignment Strategy
IT Governance and Enablement Strategy
- In every case where we have been consulted to remedy an unsatisfactory transformation outcome or outsourcing relationship, insufficient attention to and resourcing of governance has been a major contributing factor. Getting this right the first time is of critical importance to the chances of success.
- Governance of a transformed state (or an outsourcing relationship) is significantly different from oversight of a vendor. Make sure governance roles and staffing are determined appropriately.
- Start out by assuming that the core governance roles are full-time commitments
- Prepare extensively for committee meetings. It is in the initial meetings that trust and process become ingrained in the members of the governance team. Once established, you want each meeting to be a formality where people already know and approve of what you seek. to accomplish. If you get into any kind of disagreement, withdraw your suggestion so you can have more time to study it. You will come across as more open minded and caring.
- If the Board of Directors gets involved, pay special attention to the outside directors. They are more attuned to corporate governance matters and will emphasize issues of counterparty risk and public policy, even if those issues seem to be tangents for IT.
Application Sourcing Strategy Roadmap and Readiness Assessment
- The sourcing strategy must be grounded in the business goals, and take into consideration the organization’s ability to accommodate change.
- The sourcing strategy can evolve over time, but needs an overall vision to guide the evolution.
- The service delivery model may be accomplished in stages, but must be viewed and designed holistically to ensure a cohesive, rational progression to the end state.
- Experience with sourcing, both internal and external, is critical to achieving the desired business goals. These are complex projects, and require comprehensive expertise to be successful.
In summary, TBI has the experience, the tools and the industry background to help you through all the phases of IT Rationalization. Application and Tools Assessment is one of our key competencies – and our extensive knowledge of the other phases of IT Rationalization enable us to make reasonable, actionable recommendations – grounded in business, functional and technical contexts. Our collaborative style will facilitate gathering the information, evaluating the information and reaching conclusions and recommendations that will work in your technical and business environment.