Class 3: ISM P3 January 2005

Managing IT Adoption

“We can now do IT!”

Class 3: ISM P3 January 2005

IT at KCC after 2001: Key Benefits

Built its IT capabilities:“Our ‘we can do it’ attitude was a huge change!”, Mary Mallet

Back office automation and integration to prepare for front office e-government

Drive change through IT, e.g. Organizational changes: more resources to front office and less

“waste” on back office, creation of KSSIP, IT organizational changes

Process changes New chart of accounts – first in 10 years

Plus other “typical” benefits (reduce IT costs, automate and infomate processes, process efficiency, accurate information, other cost reductions such as head count reduction, etc…)

Class 3: ISM P3 January 2005

IT at KCC Before 1999

Many small (£150K) isolated (legacy) IT systems, no project with critical mass

Outdated technology with high maintenance costs Many-headed IT Hydra: a “Spaghetti Chart” IT

Autonomous groups making IT decisions Poor IT investment decisions: “all are urgent” Diffused ISG - 200 employees, attached to functional

areas: blurred responsibilities

Uncertain IT skill sets

Low IT incapable of delivering e-Vision– Low confidence in IT capabilities– Organizational inertia: impediment to change

Class 3: ISM P3 January 2005

Options for KCC

How can KCC build its IT capabilities? A. Outsource IT B. Succeed in-house major IT adoption

KCC Outsourcing Decision Process: Pros:

Faster and safer implementation

Cons: Risk sharing and accountability? Internal IT knowledge and capabilities?

Class 3: ISM P3 January 2005

Managing Inertia at KCC

Why:

Large scope of required ITNumber of groups

involvedNumber of processes

affected

Many autonomous groups affected by IT

How to manage:

Broad top management involvement: “It was a defining moment… bigger guns were needed”

Careful scope reduction and incremental phasing: “Phase One took us out of the hole”

Urgency feeling: “We must reach our 2005 targets!” – the “frog in the water” rule

Class 3: ISM P3 January 2005

Some Best Practices from KCC Governance:

Top management commitment and involvement (needed)

Cross-functional steering committee – all key stakeholders have a voice

Able project manager

Close vendor/partners collaboration (steering committee, integrated team with KCC people)

Project Management:

Clear Targets: “Set clear money, time, “how far and how fast” targets early on”

Flexible targets: “…and be ready to challenge them soon”

Clear process maps: “as is” and “to be”

Smart “process versus software customization” decisions: “vanilla” vs business

Risk identification: identify potential risks, and prepare for possible crisis

Iterative planning and testing

Stakeholder Management:

Communication: create visibility of the project throughout the organization

Expectations management

User involvement (justify IT (our ‘e-vision’), conference room pilots, training, de-snagging)

Post go-live support until stabilization

Class 3: ISM P3 January 2005

IT versus Organization

Change the Process Change the Program

Easier software configuration Easier change management and adoption by users

Anyway it’s not important an important process

Clearly a very important process

Potentially design new, more efficient, processes

Process is an industry standard (e.g. customers/suppliers/etc demand it)

Easier to upgrade the IT in the future

And always consider:- Flexibility needed in the future

- Standardization needed to limit autonomy and “creativity”, and increase process efficiency

Class 3: ISM P3 January 2005

Governance: Rich-Con vs KCC

Both (Sawyer & Mallett) were highly committed to the project, but:

Sawyer tried to do everything herself Mallett relied on governance structure & project execution

mechanism; played key roles that only she could play:– Protected project (sponsored it)– Communicated to top management and politicians– Managed expectations and fight off misinformation– Let Craig do most of the running– Intervened when necessary

It is not enough to get the commitment of top management:

How governance is played out is just as important

Class 3: ISM P3 January 2005

A Governance Structure

Executive sponsor (Mary and Tom/Kevin): VP, CFO, CEO: relates system to overall strategy,

communicates to affected parties, manages expectations, enforces/manages necessary organizational changes, supports crisis

Steering Committee: All key stakeholder groups get a voice (Dave/HR,

John/Finance, June/IS) Vendor/partner involved

Project manager: Combination of technologist, business expert,

politician

Class 3: ISM P3 January 2005

The Road Map will apply to each Project within the Programme!

• Configure new Organisation Structure and Processes

• Undertake Change Management across KCC

• Prepare for Directorate benefit realisation

• User Acceptance Testing• Systems Implementation• Develop Reports & Forms• Integration Testing• Project Teams Training• Prepare and agree cutover plan

• Identify Aims, Scope, Approachand key issues to resolve

• Produce Programme Brief• Launch Programme• Produce Programme PID• Define & assign organisation• Define skills & establish

resources• Set-up risk & issues log• Produce sub-project PIDs• Develop Programme Plan

with Directorates• Outline Technical

Requirements• Recruit project staff

Stage 1

Stage 2

Stage 3

Stage 4

Stage 5

ProgrammePreparation

Implementation

Pre-live Testing & Training

Go live & Support

Design & Set-up

Jan 2002

Programme Launch22nd Oct 2001

• Hold requirement workshopswith the business

• Define and communicate newbusiness processes and organisationstructure

• Refine Programme Brief & PID• Review impact on systems &

organisation environments• Commence data cleansing• Programme Team training• Procurement• Detailed technical requirements

• Agree go-live strategy• Finalise cutover plan with Directorates• Role based Training & Education• Data Conversion• Resolve all outstanding crucial issues

• Set-up support organisation• Bed down new processes

& systems• Establish Super users• Monitor “go live”• Client acceptance• Develop lessons learnt• Close Programme (Projects)

Programme Coordination / Project Brief / KSSIP Road map 05.04.02 v3.3

KSSIP Road Map

Class 3: ISM P3 January 2005

Main IT Implementation StepsRealizationof need

- The IT

Investment

Decision

Preparation

-Sell the project internally and externally (i.e. work with customers that you may mess up orders with)

-Create cross-func. project team

-Define scope and budget

-Broadly map «as-is » and « to-be » processes

-Check for training requirements

-Understand risks

Selection

-Visit providers

-See their existing customers

-Check financial viability

-Check fit

-Negotiate

-Choose outside help

Implementation +

- Redesign process

- Modify code

- Train users

- Iterative testing of the system

- Change management

- Manage «scope creep»

- Manage crisis

- Design incremental steps

« Go Live »

Incr. phase vs Big Bang 

New systemin use

- Check for failures

- Post-live support

- Lessons learned

Class 3: ISM P3 January 2005

Many Best Practices, but… Why So Many IT Failures?

The “silver bullet” theory or the “too little IT knowledge” theory

The “too much IT knowledge” theory

Class 3: ISM P3 January 2005

Key Managerial Actions1. Governance

a. Top management involvement b. Cross-functional implementation teamc. Project managerd. Close collaboration with partners (vendor, implementation partner)

2. Project Managementa. Target definition: time, budget, scopeb. Target definition management: scope reduction, scope creep management,

time/budget changes managementc. Clear process maps and smart customization decisions d. Crisis management and risk identificatione. Iterative testing and prototypingf. Size of incremental phasing (from “many small incremental phases” to “big

bang”)

3. Stakeholder Management (pre/during/post)a. Communication and user buy-in b. Expectations managementc. Change managementd. Further user involvement (e.g. pilot testing)e. Training f. Support and help of user – pre and post

Class 3: ISM P3 January 2005

Avoiding Resource Over-spending:

Some ExamplesWhen may these resources be less critical?• Top Management Involvement: e.g. local

organizational scope, low coordination needed, little “on stake” by stakeholders

• Training: e.g. high IT sophistication, few changes

• Testing: e.g. few software customizations needed, “old” tested or non-complex technology

• Change Management: e.g. few changes/high flexibility, little on stake, low coordination needed and low organizational scope

Class 3: ISM P3 January 2005

Foreseeing the Key Foreseeable Adoption Risks

Key Risks

Inertia

Resistance

Mis-specification

Mis-use

Non-use

McAfee, SMR 2003

Factors (observable pre-implementation!)

Stakeholder Analysis

1. IT sophistication?2. Impact: a. Changes needed vs. flexibility ratio? b. How much is on stake for them? c. How autonomous are they?3. Size: organizational scope and coordination needed?

Technology Analysis

1. Size: technology scope (number of processes and systems affected)?2. Is the use of the technology discretionary? Mandatory?3. Software changes/customization needed? 4. Is it modular?5. How complex and/or novel is it?

Class 3: ISM P3 January 2005

Factors Key Risks

Factors Key Risks

Large organizational scope (S)Many autonomous groups (S)

Inertia

A lot on stake (will IT influence power of some people?) (S)High changes/flexibility ratio (S)

Large autonomy of groups affected (S) Resistance

Many software customizations needed (T/S)Low modularity of technology (T)

High novelty/complexity of technology (T)Large technology scope (T)

Mis-specification

Low user IT sophistication (S)Large organizational scope (High coordination needed) (S)

Mis-use

IT is discretionary (T)Low user IT sophistication (S)

High changes/flexibility ratio (S) Non-use

Based on McAfee, SMR 2003

Class 3: ISM P3 January 2005

Key Risks Key Managerial Actions Examples

Inertia•Top-management involvement

•Scope reduction & incremental phasing KCC, Cisco

Resistance

•Cross-functional teams•Further user-involvement

•Communication and user buy-in•Change management

•Scope reduction & incremental phasing

CCC (G2G portal)CRM/sales peopleRI (online surveys

portal)

Mis-specification•Iterative testing and prototyping

•Careful software customization decisions and process maps

Rich ConNike

Mis-use•Training and post live support

•Scope reduction & incremental phasing Rich Con

Non-use•Cross-functional

management/implementation team•Further user involvement

•Communication and user buy-in

Rich ConCoSine Com (CRM)

Avoiding Adoption Risks: Focused Resource Allocation

Class 3: ISM P3 January 2005

The “Certain Unforeseeable” Risks

IT adoption projects entail unforeseeable uncertainties:– IT projects are by nature very complex – too many

things can go wrong!– Requirements change over time– Technology is complex (e.g. software bugs, new

technology is not yet there)

Crises during implementation are almost certain – but “details” are unforeseeable

Class 3: ISM P3 January 2005

Preparing for the Unforeseeable Risks

1. Governance:

2. Project Management:

Have an anticipatory mind frame, and focus on keeping the project’s momentum

Class 3: ISM P3 January 2005

Key LessonsThe KCC way of building IT capabilities: succeed

on a large IT system adoption (more next class)

3 Steps for Foreseeing the Foreseeable Risks:1. Always start with a Stakeholder and Technology

Analysis2. Identify likely foreseeable risks3. Focus resources on key strategies needed to combat

identified foreseeable risks4. Manage carefully unnecessary resources

Controlling the Unforeseeable Risks and Crises:1. Setup the right governance (decision power and

partner flexibility)2. Plan appropriately the execution (iterative adoption,

incremental adoption, risk identification, target flexibility)

Class 3: ISM P3 January 2005

Next Class

Building a “We can do IT” Organization

- What are the key IT capabilities?

- How are IT decisions taken in an organization?

- Can IT lead to sustainable competitive advantage?