CIOs have long been compared, sometimes favourably, sometimes not, to jugglers. At any moment they have 19 balls in the air and some clown trying to add a 20th.
It is critical they pick the right IT projects to commit scarce resources to – not only to achieve their organisation’s goals and strategy, but also to maintain team morale and sanity.
But it’s not always easy to ignore the loudest or most powerful voice in the room.
In a new iTnews Digital Nation mini-documentary about prioritisation (watch it at the start of this article), business leaders coalesce around the idea that the business, not IT, needs to lead this process, and should be willing to debate the priorities.
The dramatic acceleration of digitalisation due to the pandemic, which swept away the inertia of business as usual, has amplified the importance of a robust prioritisation methodology.
David Hackshall, the CIO of medical devices giant Cochlear, which has a market capitalisation of $16 billion, says the need to ensure effective cash allocation during the dark days at the start of the pandemic was a key driver of a shift to a new approach.
That approach involves IT initially stepping back from the process and business leaders taking more direct responsibility for determining how a project aligns with such issues as strategy, regulatory requirements, and financial goals.
“You get an aggregated score and that aggregated score is the business value,” says Hackshall.
IT does not contest or debate that score, he adds.
Instead, once business priorities are set, IT creates and applies a new filter – around complexity.
“The complexity score looks at is this easy to do? Is this really hard to do? Is this a major piece of work, a small piece of work, a medium-sized piece of work? Instantly, now you've got a two by two matrix capability, a business value and an IT value,” Hackshall explains.
Every six weeks IT facilitates a process that brings together stakeholders from throughout the organisation.
“We say, ‘Here's the ask based on the calculated scores. This is what you are asking the IT organisation to complete. And this is the ranked order in which you think is the most valuable to the least valuable piece of work – debate.’”
In addition to more closely aligning project priorities and company strategy, the new approach has had another important benefit – it has significantly improved the technology group’s internal engagement score, even though they were now more likely to say no than yes to requests (read more about this in our story ‘How learning to say no improved the perception of IT at Cochlear’).
“The engagement score for IT is up 12 points,” Hackshall says.
Pick and stick
Roby Sharon-Zipser, the co-founder and CEO of Hipages, Australia’s leading online platform for tradespeople, highlights another reason for building discipline around the prioritisation process – morale.
At Hipages, priorities are determined by cross-functional teams after pitches to the leadership group.
“Usually it’s set for a quarter or a few quarters, you don’t want to change [priorities] every month. I don’t think that does anyone any good. You need to give people the ability to follow through on their idea unless the house is crumbling down and there’s a major catastrophe, but that shouldn’t happen,” Sharon-Zipser says.
“If you've got a good strategy and plan, the focus should be on delivering and executing what the priority was for the quarter or the half.”
Like Cochlear, Hipages has changed in the last year how it prioritises and executes, although that’s as much a function of scale as a response to the pandemic, Sharon-Zipser says.
“We looked at the way we work as an organisation, particularly around how we set ourselves up, from usually siloed functional teams to cross-functional teams. I think that was the major pivot for the business in the last 18 months – working in a cross-functional team environment. That has really allowed us to execute on the strategy,” he explains.
According to the Hipages chief, “You've really got to make good decisions on the delivery of your product. We do have a product roadmap, we use the cross-functional teams in the organisation. A cross-functional team is usually made up of about eight people. There is a leader who is responsible for the delivery of the mission and goals of that cross-functional team … and there’s a sponsor who is accountable to the CEO – usually it’s a C-Suite that’s the sponsor."
“Now, in those teams, we give them the freedom to look at a particular mission, and look at a particular problem and the team itself determines the prioritisation,” he says.
“There are some parameters. The rate of return needs to be calculated on the deployment of resources to solve a particular problem. That's an important calculation. And it has to be really aligned to the actual corporate goals of the business. So whatever goals or metrics that cross-functional team is chasing, they will try and make sure that their metrics ladder up to the corporate goals that are in the strategy of the business.”
Sharon-Zipser says the current approach represents the best fit for the scale of the business, which now has close to 200 people.
“That's the evolution. I'm sure when we get to 1,000 people one day, it'll be a different structure as well. Organisations evolve to adapt to the scale and the environment that they're working in.”