Does an agile organisation still need an IT strategy?
How must IT position itself in order to best support the goals of the company/organisation?
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Agile IT Organization, Agile Work, IT Strategy
The IT strategy is an important building block in the planning and further development of IT, regardless of whether it is organised as a department, business unit or group company.
The IT strategy defines the objectives and ensures that IT understands the company's business objectives and aligns itself with them. In this respect, the annual review of the IT strategy is a good opportunity to check whether IT is still prioritising the right things and aligning its skills and resources with the needs of the specialist departments and internal customers.
The premise of an IT strategy - if it is meant seriously and not just to fulfil internal compliance - is "How must IT position itself to best support the goals of the organisation/company?".
Contents:
- How must IT position itself in order to best support the goals of the company/organisation?
- Agile organisations value flexibility
- What makes a good IT strategy?
- The IT mission statement
- Assessment of the situation
- Strategic cooperation model
- The guidelines of the IT strategy
- Measures to achieve the IT strategy goals
- Integration of the IT strategy
- IT strategy roadmap and schedule
- Summary: Does an agile organisation still need an IT strategy?
How must IT position itself in order to best support the goals of the company/organisation?
In practice, an organisation's IT strategy is created or revised in an internal project, often for a multi-year period of 3 to 5 years. The IT strategy therefore takes effect over a longer period of time and works with assumptions and on the basis of facts and objectives that are relevant and current at the time of creation.
But, and this brings us to the key question, what benefits can an IT strategy have for a company that has opted for a scaling, agile IT organisation?
noventum consulting has carried out a large number of projects in the areas of "IT strategy" and "adaptive IT" with a consulting focus on CIO Advisory and shows in this article the benefits of an IT strategy for an Agile@Scale organisation.
An Agile@Scale organisation is a company that applies agile principles, mindsets and practices in all areas of its organisation. This means that agile methods are not only applied to teams and projects, but also to programmes, portfolios and the entire organisation.
Agile organisations value flexibility
Agile organisations claim to be able to adapt quickly and flexibly to change. They are generally organised in a lean and efficient way and rely on agile methods and tools. They attach great importance to flexible collaboration and work in cross-functional teams to achieve results quickly and effectively and are constantly looking for ways to improve.
An agile organisation is very likely to have an agile IT organisation. There are a number of scaling agile models that companies use to scale their IT organisations. The best-known models include
- Scaled Agile Framework (SAFe®): SAFe is a comprehensive framework that helps companies to scale agile methods and practices to large organisations.
- Large Scale Scrum (LeSS): LeSS is a framework that scales Scrum to large teams and organisations.
- Spotify®: A model that doesn't want to be a framework at all; with a focus on autonomy, collaboration and the organisation of work
What applies to all scaling agile models is that they place the highest priority on flexibility in task planning and work organisation and are based on an agile mindset.
An agile mindset is a set of values and principles that help organisations and teams to embrace change and adapt to it effectively. It is crucial for fostering a culture of continuous learning, adaptability and innovation.
Applied to an organisation, "agile" means that the management and control of projects and processes is dynamic and flexible. Less planning and management intensity enables the rapid implementation of a project, a high degree of adaptability and a high degree of personal responsibility.
What makes a good IT strategy?
In order to decide whether a classic IT strategy is of any use to an agile organisation, we look at the building blocks of an IT strategy and evaluate them from the perspective of an agile organisation.
The following structure has proven itself as the result document of an IT strategy:
- IT mission statement
- Assessment of the situation
- Strategic cooperation model
- IT strategy guidelines
- Measures to achieve the strategic goals
- Integration of the IT strategy
- IT strategy roadmap and schedule
An IT strategy does not create itself. Both the structure and the content of the IT strategy must be developed, discussed and decided by the organisation's IT managers. The involvement of management and experts is extremely useful here and a prerequisite for subsequent, successful implementation. Because here too, the journey is the reward!
An anecdote from noventum's everyday consulting work: During the first workshops to revise an IT strategy for a medium-sized manufacturing company, we were asked by the CIO - just for fun - whether we could take the existing IT strategy in payment: it was so generic that we could easily use it for other customers and - it was still almost unused!
The IT mission statement
The cornerstones of the IT strategy are the expectations that the company has of IT and the IT organisation's commitment to meeting these expectations.
Therefore, the first steps include a clear understanding of the corporate strategy and goals and deriving the strategic goals of IT from the business requirements. The formulation of a mission statement or vision and mission of the IT organisation has proven successful in this regard. In this mission statement, the role and the IT organisation's own value contribution are described and confidently communicated within the organisation.
The claim as to whether IT is positioning itself as a business enabler and digitalisation partner and what value contribution the management sees in IT is essential for deriving the strategic goals of IT.
This also and especially applies to agile organisations that use agile teams in scaling models (Agile@Scale).a
Assessment of the situation
For realistic IT planning, you also have to face up to the realities; what went well in the past, what didn't? To what extent have you met your own requirements and strategic goals? What is still missing to fulfil your own aspirations?
To answer this question, it helps to carry out the classic SWOT analysis.
SWOT stands for Strengths, Weaknesses, Opportunities and Threats. It is an analysis technique that is used to evaluate the strengths, weaknesses, opportunities and threats of an IT organisation.
The findings on the strengths and weaknesses, in particular the achievement of the defined strategic goals and the expectations from the mission statement, become fields of action and initial measures for the subsequent operationalisation of the IT strategy through a gap analysis.
A gap analysis is a comparative analysis that identifies the difference between the current state and the desired future state of IT and helps to assess its current capabilities and identify areas for improvement (= fields of action).
As a result of this step, we have drawn up a list of areas for action and, in some cases, concrete (strategic) measures for how IT must develop in order to come closer to our aspirations and strategic goals.
Strategic cooperation model
A direct result of the mission statement and the vision and mission is the discussion about cooperation between the IT organisation and the specialist departments, with external service providers and other stakeholders. Tasks and responsibilities are clearly defined and described in a target image; this also includes the coordination and clarification of co-operation and the transfer of responsibilities.
In traditional organisations, planning tends to be hierarchical and based on a division of labour. Agile@Scale organisations, on the other hand, value an end-to-end view of responsibility. Instead of RACI tables, the value stream is analysed and comprehensive responsibility is assigned to interdisciplinary teams.
RACI is a method for assigning responsibilities for tasks or activities. It is often used in project management, process management and other areas where it is important to clearly define who is responsible for what.
The guidelines of the IT strategy
After clearly defining the mission and requirements of the IT organisation in the first step, identifying the fields of action and developing the best possible collaboration model, it is now time to work on fundamental guidelines for future decisions.
These guidelines can also be viewed as sub-strategies within the IT strategy, such as the sourcing strategy, EAM strategy or HR strategy, at least at a high level of abstraction.
Guidelines are fundamental decisions that result from the strategic objectives. They help with technical decisions, as the principles for certain fields of action have already been defined.
Strategic guidelines generally describe fundamental positions, e.g. on
- Vendor, supplier or architecture decisions (SAP-first, virtualisation, ...)
- Cloud deployment (technologies, cloud-only, preferred hypervisor)
- Sourcing (make-or-buy decisions, shoring and supplier selection)
- IT security (compliance rules, technologies and standards)
- Personnel (requirements, demographic change, personnel development, knowledge transfer)
- Agile@Scale methods and mindset (frameworks, agile principles, tools, training)
- Innovation & consulting (trend scouting, co-operations and internal consulting)
- ...
The guidelines are developed, defined and agreed independently of the individual case. A process must be established to evaluate all operational decisions against the guidelines. Deviations from the guidelines are possible if the consequences are clear and consciously accepted.
The guidelines support agile organisations in the autonomous processing of tasks. There is no higher-level decision-making authority. All agile teams are guided by the organisation's guidelines and can act freely within this framework.
Measures to achieve the IT strategy goals
The previous chapters have resulted in many open tasks, fields of action and specific needs for change. These may be organisational measures, such as improving requirements management to enable agile project management, or technical measures to comply with the cloud guidelines. These measures must be described, their scope and impact determined and their costs and benefits assessed.
In traditional project management, similar measures are combined into projects and, from a certain size, into programmes and described in project scope documents. In agile organisations, on the other hand, tasks are defined in stories and epics . Here, too, the implementation is not planned in detail, but the final state is described as a 'Definition of Done' (DoD).
In both scenarios, the task packages are stored in a task memory (backlog). Structural planning only takes place later.
In the classic organisational model, a programme is usually drawn up across the strategic projects from the IT strategy and a programme manager monitors the implementation of the projects through classic reporting on the project status and the achievement of the project goals.
In agile organisations, there are different methods for implementing strategic measures depending on the agile framework. Regardless of whether a strategic initiative, an epic backlog or a release train is used, the tasks must end up with the right teams. Step-by-step task planning such as the flight level model can help here.
The flight level model divides the work of an organisation into three levels. Flight Level 1: This is where the operational work of the individual teams takes place. Flight Level 2: This is where the teams and products coordinate. Flight Level 3: This is where strategic planning and control takes place.
Integration of the IT strategy
The next step is the implementation of our IT strategy and the associated measures and fields of action. This chapter describes the structural processes that should enable the successful implementation of the IT strategy.
The first step is to establish the future role of IT as formulated in the mission statement. To this end, decisions must be made, responsibilities clarified and people and roles integrated into decision-making processes. All those involved must be informed about the changed role of IT and its authorisations and enforcement options. We use classic stakeholder and change management methods for this purpose.
If the role of IT requires it, it is included in key decision-making and management committees, such as the committees for corporate development, budgeting and forecasting, R&D and production planning.
Another important part of implementing the IT strategy is setting up a control and analysis model for implementing the strategic measures.
OKR has established itself as an agile method for identifying tasks and monitoring the achievement of objectives. Companies, organisations and teams use OKRs to define, track and measure their goals.
IT strategy roadmap and schedule
The final part of IT strategy planning is to create a roadmap to describe the dependencies of the strategic measures at programme level. The IT roadmap includes all strategic measures on a time scale for the next few years.
The roadmap visualises the major milestones that are necessary to achieve the strategic goals and establishes the connection between the business strategy, the IT strategy and the strategic programmes. The IT strategy must be measured against the achievement of the strategic milestones.
An IT strategy roadmap is useful and necessary in both traditional and agile organisations.
Summary: Does an agile organisation still need an IT strategy?
Yes, even and especially an agile organisation needs an IT strategy. An IT strategy is a framework that defines the IT goals and priorities of an organisation. It must support the company's business objectives and utilise IT resources and capacities in such a way that these objectives are achieved. Agile@Scale can be a suitable method for achieving this.
Agile organisations are fast and adaptable. They must be able to adapt quickly to changes in the business environment and customer requirements. This agility is an important characteristic of IT, but it is only made possible by strategic projects, the right positioning of IT in the company and an agile collaboration model.
Agile teams also set themselves long-term goals in the sense of a "purpose"; they outline a rough path, but only ever plan the next steps.
An IT strategy can help to establish Agile@Scale by defining agile methods and practices, paving the way and driving implementation against all odds.
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