Running Corporate Technology: Smart vs Traditional

There are two fundamental ways to run technology inside your company (and various states in-between)

The Truth

Before we get started, what lies beneath is actually a rant. It’s not even a well disguised rant and the reason for this is two fold. Firstly, I don’t expect many people to read this, so the return on the effort required to dress it up would be low. Secondly, I wrote this for my benefit to relieve frustration – nothing to do with trying to educate or for some greater good thingy. So if you continue to read this article, you are essentially paying my “frustration tax”… So thanks for that 🙂

The Models

Large corporates will tend to confuse a bad culture with poor performing staff. My experience is that a lot of execution issues center around cultural issues.

There are broadly two fundamental models of organising tech inside a corperate (and various states in-between).  To assess which world you live in, I have described the general characteristics of the two models below:

Model A:

  1. Your technology leadership/technology exco consists of auditors, CFOs, HR, risk management and generic management. They have never, will never and can never make a technology decision, as there is no understanding of technology. To solve for this, the leadership simply syndicate every single decision out to the widest possible group. Decisions take ages, as most of these groups also dont understand technology. When an eventual decision is made there can be no accountability as its unclear who made the call. By default they will always favour the status quo, they are extremely uncomfortable with all forms of change, they are fragile leaders and will focus a lof of effort on blame offloading. They still believe you cant get fired for buying IBM (no disrespect to IBM).
  2. You will spend a number of months collating voluminous documents containing all possible requirements for your products over the next n years. This is often mistaken to be a “strategy document”.
  3. You believe in developing technology away from your customer in “the center”. One day you feel you will “extract synergies” and “economies of scale” if you do this.
  4. You believe each business head should have a “single face off” into technology. This “engagement manager” (aka human inbox) attempts to use “influence” by routing escalation emails through the organisations hierarchy to try generate outcomes.
  5. Your central functions haven’t quite delivered yet, cost a small fortune, have top heavy management structure, BUT will “definitely deliver next year”. These functions manage using “gates and governance” and often send out new multi-page “Target Operating Model” documents which nobody reads/understands.
  6. You believe you can fix technology with manually captured metrics like SLAs, OLAs, KPIs etc etc. You have hundreds of these measures and you pay a small army to collate these metrics each month. These measures always come back as “Green”, but you are still unhappy with the performance of your technology teams. You feel that if you could just come up with that “killer metric” that would show how bad technology really is; you could then finally sign an outsourcing deal to “fix it”.
  7. You ask for documents from technology showing exactly what will be delivered over the next 3-5 years time horizon. You believe in these documents and feel that they are valuable. Historically they have never been close to accurate. You will likely see an item in 2025 which states “Digital Onboarding of Customers” – this is around the same time that the rest of the world will be enjoying the benefits of teleportation!
  8. You hire an army of people to track that technology are “delivering on time”, they are not delivering on time and you still don’t know why. To scale output you hire more people to track why technology is not delivering on time.
  9. You are constantly underwhelmed with what eventually gets delivered. It doesn’t do anything you really wanted it to and your customer feedback is lackluster at best.
  10. There are clear lines of distinction between technology and the business. Phrases like “I could make my budget… if I could only get some delivery from tech” are common place.
  11. The products delivered have all the charisma and charm of a road traffic accident.
  12. You believe, if you can just get the governance right and capture the requirements, then you will get the product you wanted.
  13. Your engagements with technology will take the form of “I need EVERYTHING from product X delivered by by date X. How much will it cost?”. When you get the reply a few months later, you will ALWAYS reply “that’s crazy!”. You will then cycle requirements down until you get beneath a “magic” number (that’s unknown to technology). This process and take years.
  14. Your teams spend more time in meetings or delivering static documents, than delivering business value.
  15. You layer governance meetings with various disconnected management teams, all with competing interests. This essentially turns an approval process into a multi-week/month attrition circus. The participants of this process have to explain and re-explain the exact same business case in multiple formats and leave the process with zero added insights, but minus a chunk of morale.
  16. If you ever looked at any documents signed related to technology spend, there are likely to be dozens of signatures on the documents and nobody quite recalls why they signed the document and who owns the actual decision for the spend.
  17. You direct as much technology spend as possible through a project governance process. This gives the illusion of a highly variable tech spend, focused on strategic investments. Your aggregate technology spend is nothing short of intergalactic. Funding abruptly expires at the end of each project and the resources promptly vanish. Most of your products are immature/half finished, you have a high number of (expensive) contractors, you leak IP, you love NDAs, nobody knows how to maintain or improve the products in production (as the contractors that delivered it have all left) and if you ever tried to reduced the SI spend, the “world will end”. 
  18. You can’t quite understand why everything in technology costs 10x what it would if you gave it to a start up.
  19. Technology is a grudge purchase, and internal technology spend is an absolute last resort. Most of the people in your technology teams have never written a line of code. You urge your CIO to sign outsourcing documents with a “low cost location”. You believe this will give you a 20px reduction in costs over 5 yrs. All the previous attempts to do this have failed. Next time will be different as this time you will capture the correct SLAs to fix technology. You use expressions like “we are a bank, not a technology company”. 
  20. You believe all the value stream is created in the selling of the digital artefact; not the creation of the artefact itself. Your solution to poorly designed artefacts that are hard to sell is to hire more sales staff.
  21. You fear open source and prefer to use multimillion dollar vendors for basics like middleware (please see Spring), business process management and databases. You build everything in your own data centre as you believe the “it’s a regulatory requirement”. It takes you several months to deliver hardware, or a engage with your vendors.
  22. You actively promote Monoculture. You believe that “do it once, everywhere, for everything, forever” is a meaningful sentence. You install single instances of monolithical services that everyone is force to use. These services are not automated and so generate hugely painful backlogs, both for maintenance and adding new services. You can never upgrade these monoliths without asking everyone to “stop what your doing and retest everything”. Teams spend a chunk of their time trying to engineer ways of “hacking” these monoliths in order to be able to deliver value to customers.
  23. You believe that most things in software are “utilities” and therefore belong in the center. You never look to prove that you get any benefits from this centralisation like lower costs, better quality or faster delivery times. The consumer of this service and the service provider will now both hire managers to work the functional boundary.
  24. In response to chronic stability issues you create various heavily populated central functions to solve things like “Capacity Management”, “Service Management”, “Change Management”, “Stability Management”. You can prepend the words: “We are really bad at ” to any of the above. Every time there is an outage the various management functions lead a charge into the application teams to report on what went wrong. The application teams spend more time speaking to the various functions than solving the actual issue. Getting a route cause is lengthy, as none of the various teams cannot agree on one version of the truth and there is infighting as each of the various areas looks to abstract themselves of any responsibility. You have effectively created a “functionally gridlock”.
  25. The business tend to export poor unilateral technology decisions to technology, and technology exports poor unilateral business decisions back. Technology will add arbitrarily points of friction/governance layers, change freezes, make material spend decisions and freeze hiring on critical products. Business will in turn sign low grade technology deals and hand them over the fence to technology to “make good” the decision.
  26. Your technology leaders will slavishly stick to their multiyear strategies; irrespective of how painful these choices may prove to be. If any innovation or alternatives are discovered during the sluggish execution of these strategies, they will resist any attempts to alter direction and try something new. 
  27. Bonus is assigned in a single amorphous blob at the top of the function. Both performing and non performing technology teams are equally “punished” with a low grade aggregate pot. Business, customer feedback and product quality have close to zero influence on either the pot size or its distribution. There are obvious advantages to hiring lower performing candidates and just a few rockstars/key men (as you would not be able to cover fair compensation for teams of high performers). It is highly likely that your organisation institutes some kind of bell curve on PD grades which further enforces that you can only have a rationed percentage of “A players”. This serves to foster the “key man” culture, ignoring the benefit of creating highly performing teams and creates a built in mechanism for “bonus casualties”.
  28. In an attempt to create efficiencies within an inefficient structure, you will tend to triplicate (find superficially similar products and artificially force them together at great expense, reduced output and increased cost/complexity). See The Triplication Paradigm
  29. Alignment costs cripple your organisation. You often find yourself aligning, re-aligning and then aligning again. Minutes are tacitly approved, then disputed, memories of what was agreed between the various functional areas are diverse. You periodically get back in a room with the same people, to discuss the same subjects and cover the same ground. Eventually you will tend to yield – resigning yourself to doing nothing (or find a “work around”).
  30. Your organisation believe rules will protect quality and consistency (the scaled efficiency model). Your process-focused culture will drive out the high-performing employees. When the market shifts quickly due to new technology, competitors, or business models, you can’t keep up and lose customers to competitors who adapt. You are slow-moving, rule-oriented and over time will grind “painfully into irrelevance”.

Model B:

  1. You hire technologists to make technology decisions. They are both collaborative and inclusive, but are happy to weigh up the facts and make decisions. These leaders constantly learn and love to share and tech.
  2. Business and technology is a pure partnership, with product development often starting with a sentence similar to, “I have x USD – work with me to get an MVP out in 3 months.”
  3. You realise the centre is not the place for client centric delivery. Technology is seen as an intimate collaborative process. 
  4. You believe in self organising and self navigation. No layering, no aggregation, no grand standing.
  5. Your central functions are thin, cheap and deliver scaled learning to the business facing teams. Other teams want to talk to them to share success, they are non political, encourage collaboration and do not sell gates and governance. The functions serve using the “zero wait” principle (i.e. they run with you to help, or let you run ahead). They NEVER block. 
  6. You have no manual metrics like SLAs, OLAs, KPIs etc. You just talk to the customer and fix what’s broken. All your products have comprehensive dashboards showing machine generated metrics, that would help track issues.
  7. You have no idea what you will be doing in 3 – 5 years.
  8. You have zero people tracking/reporting delivery. If you need to look in the rear view mirror, get it yourself from Jira.
  9. You are constantly flawed with the innovative solutions your teams have come up with. You could actually sell your products to other companies!
  10. There are no clear lines of distinction between technology and the business.
  11. The products delivered are designed iteratively with the customer at the centre, they have an “inspired” experience.
  12. You don’t believe in any governance, except macro finance.
  13. You neither read nor write requirements documents. Product documentation is developed after the fact and where possible is automated (eg Swagger).
  14. You teams reject most meetings, have a 15 min daily standup, use instance messaging groups, phone calls etc etc.
  15. Approval always sits at the lowest federated level, ideally with a single person or product owner.
  16. If you ever looked at any documents signed relating to technology spend, there would be single signatory. This person would be the actual decision maker, not an arbitrary person high up in the organisational hierarchy.
  17. You have zero projects. You work with finance at a macro level, not micro. Everything is a product and your variable tech spend is low. You have a high number of permanent staff and encourage internal mobility. Changing existing products is easy. You can’t remember when you last signed an NDA.
  18. You are able to both compete with and partner with start-ups. Your teams review start-up investments and find often find them “lacking”.
  19. Big outsourcing deals are never considered. You either buy and build (e.g. frameworks, cloud platforms) or build (with focus on open source). You actively recruit world class developers. You encourage a policy of “eat what you kill” to decommission expensive vendor solutions that are choking investment in the rest of the estate.
  20. You believe value is created equally in both selling and creation of digital artefacts; and you reward symmetrically.
  21. All new products are developed in the cloud, with an open source first approach. Your teams even share back to the wider open source community, e.g. Your developers are proactively trained in security, you anonymising data, carry out automatic penetration testing as a part of your CI and hardware is just a debate about the efficient consumption of compute (e.g. serverless compute
  22. You actively encourage scaled learning, width of thought and interop – not points of singularity.
  23. You have have no system issues and therefore no central functions to track, the teams are empowered to solve the customer experience end to end. 
  24. All decisions (technology or business) are co-authored and validated as a single product team.
  25. Pay is dealt holistically, can often include revenue share and you are incentivised to hire the best and create the best products. There are no bell curves, good feedback is not rationed.
  26. Your technology leaders will not publish strategy documents, but instead focus on scaled learning, constant iteration, experimentation and prototypes. They will tend to evolve their strategies as they go and will actively look to absorb new ideas and constantly course correct.
  27. You pay zero for alignment; you have self organising teams that own their customers and stacks end to end.
  28. You believe in accountability, empowerment and Learning at Scale. You have principles, but no rules or heavy processes to “protect” quality/output.

I appreciate this article might be provocative, and that’s by design. The main point from the above is that the incumbent tech status quo in most corporates is not really challenged. Instead the tendency is to continuously draw and then redraw functional boundaries – in the process traumatising staff, relearning the exact same lessons and creating an internal talent vacuum. It’s interesting that the removal of these boundaries altogether is rarely questioned. In fact, in response to failed tech strategies most corporates will actually choose to scale these failed strategies – rather than question the validity of the approach. This is my view is a material mistake – technology is all about intimacy, and to get it right you need to embed it into your companies DNA.

To summarise, if you build an institution with “padded walls” you would expect a certain type of individual to be comfortable living there. Similarly, if you build a corporate that does not reflect it’s customer, if the roles of the leaders of this organisation are so generic it’s not clear what sits where and who does what, if layering your successful teams is culturally acceptable – then the staff working in this organisation will typically be staff that don’t care about details like the customer and being successful. This, I would argue, is not a long term game plan.

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