8/8/2023 0 Comments Nimble technologiesBuild an IT infrastructure that makes changes easy and turns over control to line managers. The result: It unleashed many millions of dollars to support critical process improvement projects.ģ. A large, diversified energy company reduced its non-discretionary IT costs from over 80% of its IT spending to 60% in three years by employing much more rigorous governance of minor projects, eliminating the “IT walk-up” window, and establishing consistent vendor service levels and better deals. To free up more resources for process improvement, IT organizations could apply improvement techniques internally, as CSX did. And many are faced with repeated urgent demands that create a culture of firefighting and leave only 10% of their resources for process improvement initiatives. Most IT organizations are overrun daily with excess demand for their services. Barring huge system overhauls or migrations, our IT developments happen fairly quickly.”īut in having adequate IT resources to make system changes quickly, Morningstar isn’t typical. For instance, we recently developed a customized interface to improve the quality of our investment criteria write-ups, which took about two to three months. Our operations, quality, and technology teams work very closely with each other to drive process improvements that enhance the overall customer experience. Anu George, chief quality officer at Morningstar, a leading provider of independent investment research, explained this to me. Prioritize IT resources to be able to make process changes quickly. Assistant Vice President John Murphy told me that CSX’s process improvement leaders have found that by documenting processes and using “lean techniques” - the voice of the customer, demand management, just-in-time, level scheduling, small lot sizes, mixed model production, and cross-training - the IT organization can implement technology changes faster.Ģ. At CSX, the $11 billion railroad, the Operations Process Excellence group has a collaborative relationship with the IT group. Have a highly-collaborative working relationship with process improvement leaders, and adopt their techniques. I see three ways an IT organization can be highly responsive to managers who must make process changes:ġ. How can IT organizations be responsive when their companies need to improve business process to answer customer needs and seize market opportunities? And how can organizations do this over the long haul, not just for a moment in time? Then, the IT organization needs to roll out releases and support a consistent global platform. Executives must reconcile a range of global requirements from over 100 countries into a single software system, where before they previously had one for each country. These standard systems forced business units around the world to adhere to new policies and “best practices.” The new system also provides top management with operational performance data across countries, such as the percentage of “perfect orders” - those delivered on time, in the correct quantity, and with a correct invoice.īut this new IT platform could easily put the brakes on the company’s next round of process improvements. The company has built its standard processes for making and fulfilling customer orders on standard information systems. To highlight these issues, let’s consider a large, multinational energy company which has spent billions of dollars in the last six years to implement global standard processes across more than 100 countries in its “downstream” business (refining and retail). Companies like CSX, Morningstar and IBM show how IT can be more friend than foe to process changes. Yet IT can also limit speed and flexibility. IT can make business processes much more efficient, and lock in process improvements. Others believe they should first streamline a broken process and only then make changes to information systems, if still necessary. Why? Because they have suffered from delays and high expenses in changing information technology (IT), some choose a manual workaround that is less efficient. If you want to improve how your organization develops, delivers and supports its products or services, it’s hard to avoid changes to the information systems that enable those processes.
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