Want Organizational Efficiency? Don't Be Afraid to Reorganize

Want Organizational Efficiency? Don't Be Afraid to Reorganize

Although it's probably true that there's no perfect IT organizational structure, there are one or two basic organizational structures that provide the simplest chance of achieving efficiency and effectiveness. Yet, more often than not, we discover IT organizations with illogical reporting lines and departmental structures that can't be justified, “organizational anomalies.”

The reasons why these anomalies occur usually involve something along the lines of “it has always been found out like this” or “that’s just the way it’s.” This is perhaps true because organizational structures tend to possess inertia. A CIO must constantly assess and review their organizational structure to ascertain if it is often improved. Avoid change for change’s sake (employees tend to understand some organizational stability), but don’t be scared of confronting anomalies head-on, and lobbying for a re-org when needed.

Many CIOs (rightly) spend a substantial part of their time on recruitment, building the team, but they fail to spend time creating the simplest possible IT structure to support their business. They hire highly talented and capable people then put them into an organizational structure that perhaps doesn't guarantee they're going to fail, but makes consistent success unlikely. you would like both elements to succeed: talented people working in an optimized organizational structure.

In the world of sport, you'll sometimes build a whole team around one superstar individual, but in an IT organization, that's not a viable option. Optimal IT organizational structures aren't tailored to suit individuals. The target is to define the clearest, absolute best organizational structure, then assign individuals to the structure.

There should be no ambiguity during this structure. Lines of responsibility, accountability, and authority should be clear to both staff and management. If the solution to “Who is responsible?” is several individuals, then a reorganising is required.

A well-functioning organization also must follow and mirror the company culture. If the company culture allows regional freedom with few corporate standards imposed, then a centralized IT organizational structure that attempts to function with global standards will cause conflicts.

"Avoid change for change’s sake, but don’t be scared of confronting anomalies head-on, and lobbying for a re-org when needed"

But fully centralizing IT teams into a headquarters location will nearly always cause failure. Instead, companies should work toward achieving the right balance between regional flexibility and global standards. The IT organization must implement virtual global teams, and for that, managers can think and operate both locally and globally.

Most people like working with clarity. Not rigidity, but clarity. Knowing what they're liable for and having the corresponding authority is empowering for workers. If you'll explain your IT organizational structure on one piece of paper to your parents and your 10-year-old, then you've got clarity.

While the division of an IT organization into departments typically can't be avoided, a team-like atmosphere for the group should be encouraged. As soon as you've got departments, you've got boundaries, and each boundary may be a handoff between two or more departments. Every handoff may be a potential source of mistakes and a possible source of interdepartmental friction. So keep the structures as simple as possible and make it clear to staff that they're all on an equivalent team.

A complex organizational question that has recently arisen as a problem is that the “external boundary” of the IT function. Where roll in the hay end and business functions begin? for instance, should super users, project managers, and business process specialists be in IT or not? There are pros and cons to both options. As a starting position, everybody with access to the test and development systems, and everybody with a systems administrator level of access, should be within the IT function. However, the web of Things is now redefining the boundary issue because its functions become increasingly a neighborhood of the particular product offering. So within the future, the IT organization will get to reflect a task that's a mixture of the “traditional back office” role and a replacement “fast-moving, innovative, external customer-facing, product offering” role. Because the IT organization becomes an integral part of the merchandise offering for several companies, the boundary between IT and merchandise development, and between IT and customer service will change, and therefore the IT function will get to reorganize itself. Perhaps the standard IT organizational structure within the future will change from the “infrastructure and applications” division into a “back-office systems and front office systems” division. Either way, the web of Things goes to forever change the role of the IT function and therefore the CIO.

Despite the advantages to be gained, many managers tend to undertake to avoid making organizational changes like these, however. They worry that change “might have a destabilizing effect” (it might, within the short term) and can “upset some staff.” they assert they’re “waiting for the proper time.” There’s rarely an honest time. Sooner is best than later, just confirm to stress the advantages of the new organization.

Most re-organizations do create winners and losers. So careful planning and tons of communication are needed to successfully implement the changes. About double, the quantity of communication that seems reasonable is required.

Success should be defined as all people involved within the change understand the explanations for the change, support the necessity for the change and are clear about their roles within the new organization. Then, operational efficiency is not any longer a “nice to possess,” it’s the quality set.

Read Also

Issues and Trends in the Metals and Mining Industry

Issues and Trends in the Metals and Mining Industry

Supantha Banerjee, VP & CIO, PSC Metals
The New Tech Frontier for Utilities

The New Tech Frontier for Utilities

Greg Sarich, CIO, CLEAResult
4 Must-Have Technologies for Metals & Mining

4 Must-Have Technologies for Metals & Mining

Sharon Gietl, VP-IT & CIO, The Doe Run Company
Creating a Tangible Impact through Collaboration

Creating a Tangible Impact through Collaboration

Matt Schlabig, CIO, Worthington Industries
Building a Local Technology Team

Building a Local Technology Team

Chris Cawood, CIO, OceanaGold Corporation