Standardization, centralization, process rigor and labor arbitrage have been the hallmarks of today’s model for managing the Business of IT. IT organizations have used this model to achieve economies of scale and minimize the average total cost of IT. This approach has largely been in place for the past 3 decades that were characterized by large, multi-year IT development projects, a growing base of legacy applications and a gradual evolution of the underlying technology. While providing predictability and efficiency, this model has also served to discourage innovation, reduce business alignment and drives the balkanization of skills within the IT workforce. In this presentation, I describe an alternative model for managing IT in today's technology intensive organizations.

1. Next Generation IT
Changing the role of IT in today’s
business
Srini Koushik
December 2011
Srini Koushik - March 2012

2. For time and the world do not stand still.
Change is the law of life. And those who
look only to the past or the present are
certain to miss the future.
John F. Kennedy
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3. Gordon Moore Source: Intel Corporation
Computing power continues to increase
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4. Connectivity is exploding
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5. Bob Metcalf Source: get Satisfaction
Networks continue to grow
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6. Digitization of an analog world
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7. Everyone is connected, Everything is connected
– all the time
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8. Change is not a destination, just like Hope
is not a Strategy
Rudy Giuliani
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9. Globalization of the Marketplace
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10. Consumerization of IT
Source Wired Magazine
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11. Democratization of data
Videos Structured Data Voice Sensors
Social Data Mobile data Images
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12. Virtualization of the Value Chain
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13. Fundamentally changing the role of IT
Videos Structured Data Voice Sensors
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14. These trends are changing how we deliver IT . . .
globalization
consumerization changing role or IT virtualization
Videos Stru Voice Se
ctur ns
ed ors
Dat
a
democratization
Structured Data
Mobile data
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15. Driving the need for a different approach to IT . . .
Threat of New
Entrants
Lack of differentiation and lower switching Lower barriers to entry drives
costs results in a buyer’s market global competition
Bargaining Power Rivalry amongst
Videos Stru
ctur
Voice Se
ns Bargaining Power
of Buyers industry ors
ed
Dat of Suppliers
competitors
a
Ease of access to data results Consolidation of components across value
in more informed consumers Threat of
Structured Data
chain are driving danger of “lock-in”
substitute
products Mobile data
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16. An approach that focuses on the I in IT
INFORMATION Context TECHNOLOGY
innovate interact i n d ust ria l ize iterate improve
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17. You have to learn the rules of the game.
And then you have to play it better than
anyone else.
Albert Einstein
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18. Mass Production Factories
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19. Highly dependent on skilled labor
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20. Model Industrialized by Service Providers
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21. Scale Matters
If you think you are one in a
million there are 1100 of you in
India and 1300 of you in
China and 300 in the US
Source – Edmonton Sun
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22. Getting the Numbers Right: International Engineering Education in the United States, China, and India – Gary Geraffi, Vivek Wadhwa et. al – Duke University
Playing the Engineering game
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23. IT Economics driven by Labor Arbitrage
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24. “If we try to play like the Yankees in here
(board room), we will lose to the Yankees
out there (on the field).”
Moneyball, Michael Lewis
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25. It ain’t what you don’t know that gets you
into trouble. It’s what you know for sure
that just ain’t so
Mark Twain
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26. 1. Poor understanding of Systems
Adapted from The Principles of Product Development – Donald G. Reinertsen
2. Focus on the wrong metrics
3. Ignoring the impact of queues
4. Focus on Efficiency
5. Standardization
6. Elimination of Variability
7. Search for Scale
8. Lack of cadence
9. Managing to Plans vs. Outcomes
10.Centralized Control
IT Management Orthodoxies
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27. IT is not Innovative
Poor Quality
IT is Slow
IT is too Expensive
All of the above
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28. “When everybody else is playing Checkers –
We will start playing Chess”
Srini
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29. Defining Value
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30. IT Portfolio Management
Value Added
Activities
Enterprise Architecture
Security and Risk Management
Core Activities
Relationship Solutions Service
Specifications
Management Development Support
Staffing and Supplier Management
Activities
Support
IT Financial Management
IT Support – Facilities etc.
The IT Value Chain
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31. IT Portfolio Management
Enterprise Architecture
Security and Risk Management
Requirements Design Implementation Verification Maintenance
Staffing and Supplier Management
IT Financial Management
IT Support – Facilities etc.
AD&M Value Stream
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32. IT Portfolio Management
Enterprise Architecture
Security and Risk Management
Request Incident Problem Change Release
Staffing and Supplier Management
IT Financial Management
IT Support – Facilities etc.
Infrastructure & Operations Value Stream
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33. Create Flow - From Efficiency to Throughput
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34. From Compartmental Thinking to Systems Thinking
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35. Standardization to Mass Customization
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36. Adding Creativity to Engineering
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37. Design Thinking – Convergent to Divergent
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38. Innovation is the set of capabilities that allows the continuous
realization of a desired future by transforming what is possible
into what is valuable for many - John Kao
Strive for Perfection
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39. There are two kinds of people, those who do
the work and those who take the credit. Try to
be in the first group; there is less competition
there
Indira Gandhi
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40. 1. Visualization
2. TDD 1. Visual Workplace
3. Paired programming 2. Product immersion
4. Scrum 3. Practical Automation
5. Visual Workflow 4. Smart documentation
6. Kanban for WIP 5. Floor layout to minimize flow
7. Continuous Delivery 6. Reconfigurable layouts
8. Continuous Integration
Customer /
1. Visualization Business
2. Solution driven interactions Engagement 1. Adult learning model
3. Usable iterations Model 2. Apprentice-coach model
4. Frequent Cadence 3. Experience Management
5. Product Ownership 4. Lean TSP
6. Retrospectives 5. Knowledge Maps for Domains
1.
2.
OTB Hiring
Strategic Staffing to maximize flow
Next
3.
4.
Multi-functional Teams
Context driven staffing
Gen 1.
2.
Leader Standardized Work
Outcome based metrics
5.
6.
Outcome based org design
Co-located Pods
Industrialized
IT 3.
4.
Visual Management System
Project Enablement
Agile 5. Continuous Improvement
1. Lean PSP Learning 6. Shared pods for
2. SME Office Hours
Production
Workforce Portfolio/Architecture/Security
3. Reduce Multi-tasking System
4. Pull from WIP
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41. Example
• Top 3 Global Insurer
• Makes 10 major rate revisions a year would like to make 30
• High level of automation in the AD process
• Have used Agile for specific components of these changes
• Six Sigma has improved quality
• 70% of IT Spend is on Maintenance
HP Confidential Srini Koushik - March 2012

42. Design Rate
State Filing Implementation Rollout
Change
2 Weeks 8 Weeks 16 Weeks 4 Weeks
14 Resources 4 Onshore, 10 Offshore
Elapsed Time 30 Weeks
Average Number of Defects per production – 2 per 1000 lines of Code
Implementation Cost - $780,000
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43. Example – Applications Enhancements
Continuous Integration
Product Ownership Content Driven Staffing
Lean PSP Visual Management Mentor Apprentice
Lean TSP Outcome based metrics
SME Office Hours Frequent Cadence
Design Rate
State Filing Implementation Rollout
Change
2 Weeks 8 Weeks 4 Weeks 1 Week
10 Resources 10 Onshore Elapsed Time 14 Weeks Implementation Cost - $340,000
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44. Why do it? - Benefits
Drive Innovation
Improve Speed-to-market
Savings of 25-50%
Dramatically improve speed to market
Change the ratio of IT spend
Build Onshore capabilities
Higher Quality
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45. “Institutions will try to preserve the
problem to which they are the solution”
Clay Shirkey
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46. Thank you for your
time
srinivaskoushik@aol.com
Twitter @skoushik
LinkedIn http://www.linkedin.com/in/srinikoushik
Srini Koushik - March 2012