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Posted by Site Administrator on February 3, 2009
4/5ths of IT execs say they are re-assessing their IT organization with the intent of finding ways to run leaner. Many of these firms will use a consultancy with a practice in re-engineering IT organizations. And a number of these firms are asking me what they should look out for when they evaluate these consultancies. Why are they asking me this? First, these re-engineering projects cost a lot, 2nd, clients aren’t expert in how to evaluate who’s strong and who’s weak, and 3rd, our clients have one shot at getting these re-structure projects right, and don’t want to pick the wrong firm.
I ask them to drill down three levels into the methodology boxes and arrows charts that they bring to their sales calls.
Say, for example, that you’re evaluating how they’ll help you implement governance. At the first level, they should show you what they mean by governance (not a trivial exercise as there are 6 definitions by my current count), what are the components of governance and which groups are responsible for defining and overseeing it. That’s good level 1 coverage, but you need to go deeper. At the next level ask about these groups - how are they measured, what are their deliverables and what works and doesn’t? Now we’re cutting through the marketspeak that any consulting firm can provide. But let’s go deeper. Ask for example, of measurements and deliverables from engagements, contacts within other firms and any real numbers they have on the costs and benefits of governance.
Let me illustrate with a few good examples from the just-completed Forrester Wave.
Tata Consultancy Services (TCS) provided all the usual level 1 material – a good definition, roles, etc. But they went well beyond that and described different governance scenarios, such as Growth, Asset Utilization, and Profit. For each scenario they showed the drivers, metrics, governance mechanisms and other elements. However, they didn’t feel this was enough so they also described decision rights for different roles in IT and the business and how they changed based on the style of governance.
Deloitte provides a similar detailed response to this question and added the application of these elements to an operating model for IT - a logical clustering of IT functions. Similarly, they provided leading practices and flow charts showing how decisions are made. And they show where in the redesign of an IT organization, the Governance is defined, along with the Activities, Tools, Deliverables and Tips.
IBM went one step further and showed how governance is implemented as part of Vision, Planning, Enhancing, Designing and Implementation steps. For each step, they identifed elements including decision makers, decision criteria, the information required, decision events, and what a communications plan would include.
All three are examples of consultancies that go beyond simplistic and such obvious truisms about governance requiring senior commitment, being important to alignment with the business and other clichés. Whether you agree with their recommendations or not, they demonstrate a familiarity with the subject that comes from repetition.
Now a caveat – don’t expect every consultancy to provide everything you want during the sales cycle. Good consulting firms will have much of this packaged up and the experts that lead these engagements will know most of this off the top of their heads, but consultants are problem solvers – not marketeers. That they haven’t scrubbed examples for every aspect of their methodology is not a deal-killer. And some firms’ methodologies are so detailed that understanding every step would take months and, by itself, not solve anything. Finally, some very good consultancies are just too busy solving problems to pull this together. So get an overall view of how they do engagements like yours and drill down three levels into half a dozen areas that are most important to you. If they give you great details on 4 out of 6, they’re doing pretty well.
Are you thinking of re-structuring your IT organization? Will you use a consultancy or not, and why?
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