IT From Common Resource to Strategic Partner

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This blog post is about IT in large organisations, including public organisations like councils and businesses where new Tech competitors are changing the environment of business. The environment is changing, or more accurately, being changed by the strategies of competitors.

Organisations are looking for a digital strategy to combat this threat, moving digital to the heart of what they do. IT for it’s part is keen to become a Strategic Partner to the business. So what is stopping it?

Where did IT departments come from?

It’s worth looking at how IT departments may have been created. They traditionally exist as a cost on the balance sheet, providing common resource to other areas of the business, often underpinning other parts that are necessary, but may not directly exchange value with the environment, like accounting, marketing or HR. The may also run internal and external websites, but they are unlikely to be the core value propositions.

If not managed,  common resources can suffer from the “tragedy of the commons”. The popular example is common grazing land is so overburdened by people wanting to graze their animals that loses it’s initial value. People are assumed to want to maximise the number of animals on the common land.

Common IT Resources

Many people in IT departments will recognise this, with many unrelated customers in the business wanting their work to be prioritised by the limited IT resource. Like in the tragedy they want to get value from the resource. There is now no such thing as an IT project – they are business projects central to strategy. But with a common IT resource each may be another cow on the  metaphorical field.

The big issue is ‘Who would strategically partner with an unmanaged commons?”. It’s a very risky proposition.

From an Unmanaged Commons to Strategic Partner

Managed commons can and do exist. Elinor Ostrom studied working, managed commons, and found that there are 8 organising principals common to functional commons. Applying these to IT could provide the step towards being seen as a potential Strategic Partner.

Eleonor’s rules applied to IT may look like

  • Define clear group boundaries
    • This is perhaps the easy part, but it’s vital to understand where the boundaries are, so you can understand and manage the work and relationships across them
  • Match rules governing use of common goods to local needs and conditions.
    • Your rules will differ from other commons, best practices won’t work. You need to look at what is required by the people who use the resources.
  • Ensure that those affected by the rules can participate in modifying the rules.
    • For natural commons like an inland fishery the fish don’t get a say. For IT departments there is likely to be internal work that needs be done, for example upgrades, patching and audit requirements.  So the IT department itself, alongside Project Managers, Service Managers, Marketing and Finance should discuss the rules for using the common resoure.
    • Users of IT resources need a way of getting work done
    • They need a way of getting progress reports out
    • They need a way of getting ad-hoc questions answered by subject matter experts.
  • Make sure the rule-making rights of community members are respected by outside authorities.
    • We need to sell the idea that IT will work better for everyone as a managed common resource
    • We should have rule for getting urgent business requirements discussed and done appropriately – so that there is not a requirement for the use of higher authority to get work done
  • Develop a system, carried out by community members, for monitoring members’ behaviour.
    • Monitoring should be done bu users of the commons. It is in their interests that the rules they helped create are followed.
  • Use graduated sanctions for rule violators
    • Starting small, and agree. What sort of sanctions would you like to see?
  • Provide accessible, low-cost means for dispute resolution.
    • Anticipate things may go wrong, and we know how issues will be resolved quickly and easily
  • Build responsibility for governing the common resource in nested tiers from the lowest level up to the entire interconnected system.
    • Create systems within systems, with each level being viable. The Viable Systems Model would be ideal for creating, or diagnosing this organisational structure.

There are many other areas of organisations, or entire organisations that are Common Pool Resources. Strategically some may aim to be well managed commons, others may need to use this framework to be seen as a potential strategic partner by other areas of the organisation or environment.

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3 thoughts on “IT From Common Resource to Strategic Partner

  1. Duncan Hart

    Many IT departments have had the intent to become more strategic, many seem to have failed. I feel this has happened for a number of reasons – identity and purpose, missing or misaligned feedback loops, performance & resource negotiation.

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    1. Mike

      I see this too, VSM system 5 not managed, and a lack of resource negotiation – I’m thinking being seen as a Common Resource means that resource negotiation is not seen to be necessary?

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      1. duncanahart

        I’ve been thinking a lot about this, in particular the issues of identity and purpose. I think it’s often the case that there are two competing and divergent forces at work. Assuming that the IT department has numerous internal customers the first job is to service the customers’ demand in the most effective and efficient way possible and then maintain customer satisfaction. I’d characterise this as here-and-now, focusing on optimising individual interests at the expense of the whole.

        The second job is to maintain coherence among services and looking for synergies whenever possible. This is characterised as taking a longer term view, looking at the whole, being the corporate conscience, and recognising that there’s a community of interest

        These jobs are at odds with each other and I’m wondering how these could co-exist in harmony?

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