The architecture of enterprise strategy.
Architecture creates spaces for functions; Strategy creates functions for spaces. On with the show. Featuring ...taunts, riffs and reminders to find and fix the defects, omissions and errors in your enterprise mojo. Find or predict particular issues via the text-search tool, the archive categories, or (in the archives) the Topical Framework. To kvetch or co-conspire: comment on any articles, click here to contact me via email, or just gossip across your full six degrees of separation.
July 9, 2008
What's In Your Portfolio?
For providers (instead of consumers), Portfolio Management is a robust and widespread discipline that has meaning which crosses industries and departmental functions. In short, it organizes opportunities deemed to be beneficial into suites of categorized commitments that make the opportunity "actionable" . But portfolio management is most often associated with related efforts that represent either the authorizations of the action, the methods of the action, or the customer of the action -- in effect tracing the run from supply to demand. The efforts articulating this run are, respectively, programs, projects and solutions. One confusing aspect of the way these efforts are supported is that portfolios are mistakenly thought to be components (or "children") of programs and supersets (or "parents") of projects. In fact, that is an erroneous association: instead, as illustrated below, a portfolio is a model that relies on the other three efforts to be actualized. Further, it is the interoperations of these efforts that powers and stabilizes the portfolio.
Why is portfolio management often misplaced amongst these efforts? There are two predominant reasons. For one, practitioners of these efforts often mistake scorecards and dashboards for portfolios. And two, portfolios are often pursued under "performance" requirements (i.e., requirements to increase the rate of return on equity), whereas the actual purpose of a portfolio is to provide a model for the commitment to the opportunity, defining how value will be recognized, not how "value will be generated and captured".
The language that helps to understand where portfolios help goes like this: "what is the benefit of the investment model?" Obviously, one model could be modified or even discontinued and replaced, while still addressing the same apparent opportunity. At the least, this simply acknowledges that two competitors may chase the same prize in different ways, with both making progress (without predicting which one will prevail or even whether one necessarily must). But within the model, other key actions are generally positioned as catalysts or governors -- including things like identifying a distinctive market niche and specially producing for it, tracking the cost of scaling up for the demand level in that niche at a given quality benchmark, and exercizing policies to keep decisions and approvals predictable throughout changing circumstances -- all relative to a certain type of enabling stakeholder who is the primary beneficiary.
Posted by Malcolm Ryder at 9:21 PM
July 5, 2008
Beyond the Spin: Measure What You Give
Does your organization really measure what you give, or does it mainly spin what you measure?
Bruce MacEwen's industry-leading website Adam Smith, Esquire offers an opportunity to gaze into the abyss of metrics and walk away without jumping. In the article
"How High Quality Are Your Lawyers? (How Can You Tell?)"
a close reading shows contrasting business models contesting notions of "performance @ cost" and "value @ quality". In the competitive situation covered, one upstart model strategically goes after a chunk of the opponent's business by bringing customers the performance/cost equation, surprisingly leaving the traditionalist competitor to justify how pricing for that same chunk of business could rationally be based on value/quality. What makes this all interesting, notes MacEwen, is the idea that 99% of what the traditionalist does is what the upstart can steal away.
For those of us who fell out of the old hot habit of saying "disruptive innovation" once a month, this looks like news, but not new news. Still, there are some fresh perspectives worth bringing to this contest.
As seen in the diagram below, the different models above are easily distinguished by what they actually offer, making it inappropriate (for managers) and intellectually dishonest (to customers) for either of them to masquerade as the other. Customers buying into cost/performance are investing in the promise of efficiency, while those buying into value/quality are investing in the promise of reliability.
In MacEwen's article, we are sensitized to the problem that high-prestige value/quality law service firms institutionalize a significant unmanaged cost in the form of "available overachievers", against which these firms then build a hedge by charging premium prices beyond rational evidence of economy for the customer. But what is sold as the justification for this pricing? Their quality?
To be sure of avoiding management posturing, "quality" here must mean only one thing: adherence to the promised appropriateness of the deliverable versus the stated need. Consider that meaning against the question of what it takes to get quality: the value/quality firm proposes that by exceptional capability they eliminate the risk of not getting quality. Therefore, the key variable that this firm actually addresses is unpredictability in the customer's need. As an operational tactic, the value/quality firm hoards talent in order to avoid outsourcing and to presume agility.
But the cost/performance firm basically argues (by demonstration) that legal work requires only competency to sufficiently meet most stated needs -- not a matter of being exceptional but instead simply correct for the task, which eliminates unnecessary effort from the equation right off the bat. Of course this presumes a degree of predictability in scope of need -- and agreement on the scope becomes the main feature.
The discussion above intends no effort to offer a wisened critique of law firm strategy. That said, on the surface there are no truly important differences between marketing professional services in law versus other disciplines where subject matter expertise is the raw material and advice is the product.
Idiosyncracies in the legal services industry will of course provoke distinctive problems and solutions there, yet these are probably driven more by the state of mind of the customer - which is the underlying important difference because it is the competitive arena. Oversimplifying MacEwen's article, the difference between the value/quality firm and the cost/performance firm is that the former sells confidence while the latter sells credibility.
Are there spats? One accusing the other of con games, and the other accusing the first of being incredible? MacEwen's article says yes; but what is further interesting (per evidence of the illustration above) is the opportunity that both types of firms can objectively profile themselves on common ground (efficiency, capability, reliability and acceptability) -- and use those profiles to determine how to optimally segment and grow a shared market. When they don't do that, you can bet it isn't because the customers don't care.
Posted by Malcolm Ryder at 9:59 AM
June 27, 2008
Do As I Do, Not As I Say
The McKinsey gang's ongoing interest in behavioral economics leads from time to time to email alerts about articles that lead off like this:
Hidden flaws in strategy
"Why do top managers, steeped in theories of good business strategy, still make bad decisions? While ignorance and hubris sometimes play a role, the brain itself—how we think—is also a culprit. Insights from behavioral economics help explain why we don't always think rationally and how our logical flaws can lead to bad strategic decisions."
On a day like today, when the stock market dropped over 300 points, the catchiness of that intro is in the contrast between the confidence we want to have in logic and the confidence we want to have in our ability to use it.
Getting strict, we might have to say that when strategy is based on logic, strategy is interpretive -- because in different hands, the same logic might lead to different strategy and/or different strategic outcomes.
But why doesn't it make just as much sense to place the first faith in the strategy and then find the logic to execute it? Well, it does; it's just that in this mode, the "strategy" is not a performance; instead it is a proposition that supplies the point of view to be used when managing functions.
McKinsey's discussion seems to be poised to warn us away from the problem of management personalities corrupting objectivity, and further, poised to argue that this should be the right warning because we can assume that there is usually going to be sufficient objectivity to correctly navigate to the correct destination. That is, the most prominent assumption that we can read into the McKinsey caution is that it's not cool to split from the plan. Logic shall bear decisions and decisions shall bear the plan and the plan shall be righteous.
But isn't that still letting the bad boys off the hook? Levity aside, coaches bring the game plan to the players knowing this: that the players actually have to play, which means that the players will improvise their way to the opportunity to comply, if they understand the strategy -- "strategy" which is again essentially a point of view and not a performance prescription.
Strategy is about belief in the value of your position. It is esentially about where you're going to be, and why you're going to be there. Because of that, any position within a hierarchy of operational dependencies can be a strategic position. In effect, a position represents the opportunity, so the most direct way for a leader or manager to damage the potential of a strategy is to make decisions that inhibit or prohibit the players' opportunity to align and coordinate their compliance to the strategy.
Because of that, we want a model of coaching to rely on, not just retraining (or re-straining) of senior staffers to the logic-decision-plan mode. We want an observation-design-motivation mode just as much if not more. We want the sideline clipboard.
Posted by Malcolm Ryder at 11:21 PM
June 24, 2008
Business-IT Alignment: Who Do that VooDoo?
At Tech Republic, the online resource for IT management information, executive editor Jason Hiner's article "Sanity check: What’s the difference between CIO and CTO?" relays the following quick guide.
Chief Information Officer
- Serves as the company’s top technology infrastructure manager
- Runs the organization’s internal IT operations
- Works to streamline business processes with technology
- Focuses on internal customers (users and business units)
- Collaborates and manages vendors that supply infrastructure solutions
- Aligns the company’s IT infrastructure with business priorities
- Developers strategies to increase the company’s bottom line (profitability)
- Has to be a skilled and organized manager to be successful
Chief Technology Officer
- Serves as the company’s top technology architect
- Runs the organization’s engineering group
- Uses technology to enhance the company’s product offerings
- Focuses on external customers (buyers)
- Collaborates and manages vendors that supply solutions to enhance the company’s product(s)
- Aligns the company’s product architecture with business priorities
- Develops strategies to increase the company’s top line (revenue)
- Has to be a creative and innovative technologist to be successful
Given that picture, the two top observations are these:
1. Infrastructure affects the bottom line (what you get to keep), while systems affect the top line (what you get to get). Of course, this goes a long way towards explaining why a CIO would report to a CFO, while a CTO would report to a CEO. More importantly, it indicates that strategic resourcing can be a CIO's calling card, but that strategic positioning can be a CTO's calling card.
2. Much less explicit but still clearly in evidence is the difference between being a chief operations technologist (a.k.a. CIO) and a chief business technologist (a.k.a. CTO). Naturally, the easy way of understanding how to assess their respective progress and performance would rely on understanding the consequences -- of not having good infrastructure (provision of operations technology) and not having good systems (provision of market interaction technology). But getting it figured out in positive terms has stumped the panel often enough and long enough that these job descriptions still have to get spelled out long after the hiring has been done . What's still needed furthermore to get the dust to settle is a plan of co-production between them. Whereas neither effort alone could get the whole job done, the combined efforts of the two groups would offer a company an office of Business-IT Alignment...
Posted by Malcolm Ryder at 8:48 AM | Comments (0) | TrackBack (0)
June 18, 2008
When is "value" not valuable?
A wonderful discussion on Bruce MacEwen's website Adam Smith, Esquire included this challenging note from Paul Lippe about what logic is available to explain the connection between quality and value. While he questions "reputation" as an indication of warm fuzzies like "quality", he also kicks off his note citing the less fuzzy implication that better performance presumes to justify higher price:
"I'd be curious if anyone can come forth with any data to show that in fact (as opposed to in repute) more expensive law firms produce better results, e.g. can it be shown that the investment banks who had the largest losses on their mortgage portfolios were served by lower reputation law firms?Once this conversation settles down, I will start a separate string (and perhaps a wiki to really pull something together) on what I consider to be the core issue: how can we develop a definition of VALUE in legal services that is meaningful and useful, and not simply measuring inputs like hours spent, diligence of lawyers, law school attended or reputation of the firm. With such a definition of value, I think we could expect that some lawyers' reputations and income would go up, but some would not."
Let's dig into that overall observation by making the undercurrents obvious.
- "Value" is a label for the significant distinctions attributed to something. "Value" in professional services is 3-dimensional, at minimum. A certain method of co-operation with the customer interacts with a certain type of target outcome at a certain level of effective cost to the customer. The method, outcome, and customer cost are variables, each having a range of acceptability, which in turn allows some universe of acceptable overall impact to sprout from their combination. Now, from that dynamic, some professional service providers are great at being predictably consistent within a smaller universe (range of impacts) that the customer prefers. Some are great at being agile enough to cover a larger universe, keeping up with a customer who has more volatile preferences. And there are several other "flavors" of competency that a service provider may have. Ultimately the provider wants to be paid for the competency, and then be paid even more for a competitively greater level of competency. But the customer wants to pay for customer satisfaction, which is something different. And what mediates the balance of the two things is often just culture. I wouldn't choose to drive a perfectly good Tercel to the White House Christmas Ball, but I could; and I wouldn't choose to drive a Bentley to the 7-Eleven, but I could. In fact, I could use either car to get to either destination.
- That's all well and good in theory, but in practice the realization of the potential value is hugely affected by the ability of the customer to appropriately and effectively align to it. (There is even plenty of historical evidence that customers sometimes buy based on how they wanna be seen, not based on how they really are.) That reality is the "forest". Relentless pursuit of profit is the bulldozer that strips the forest. Atomic metrical inputs like law schools and hours spent risk merely being "trees", where excessive attention obscures the view of the forest and therefore obscures the proper understanding of the value. Profit and arbitrary metrics actually must not dominate an analysis of value. Instead, value, properly identified, can be correlated with profits and other interesting measures, and the correlations may be revealing or even exciting.
- The final point from the above is that it is probably important to use rigor in discussing value, because "value" is not a reliable synonym for other things that deserve their own names, such as "competency" and "satisfaction", and "culture". It's important to know what is actually being taken into consideration and not gloss over things for convenience, because otherwise we find out too late that we're actually sitting on some key coordinate that does not allow us to "get there from here" (i.e., to the necessary value) on time. Meanwhile -- if we would like to elevate the discussion of value from the 3-D space of CustomerCost /Outcome/Method to the 3-D space of Competency/CustomerSat/Culture, while remembering to map the current coordinates in both spaces, well that's fine.
Posted by Malcolm Ryder at 12:17 PM
May 29, 2008
Savvy About Knowledge?
Just what is it about knowledge that makes it so.. interesting... so... appealing?
On National Public Radio's KQED show "Forum", much of what was discussed recently about the elusive nature of knowledge had to do with the experience of being "certain" or "uncertain", and how that experience could be provoked, as it turns out, by altering not only the state of consciousness but the state of the brain itself. This argued that we must be able to admit the difference between believing we know, versus objectively being correct.
But it's not so important that there is any state of being absolutely "right or wrong" about what is real or what is actual.
Instead of right or wrong being the decisive criteria, what matters is that knowledge as an embrace of abstraction is different from knowledge as an embrace of concreteness.
Abstraction leads us to expect that future experience will have some particulars; concreteness leads us to accept that current experience has some particulars. Abstraction provides models; concreteness provides examples.
In both cases, selectivity is a critical determinant; maturity in knowledge broadens our scope of selectivity.
And in both cases, our mind invents experience as well as receives experience. Note that we constantly take models as examples of something, and we constantly take examples as models of something...
This "flexibility" shows that as an ongoing phenomenon, our knowledge is continually tested by the activity of inventing and receiving particulars into what we call our awareness.
In the end, we are certain that we have awareness, but we may be uncertain of whether our awareness is all it can or should be. This throws the value more on being knowledge-able than on "having" knowledge; a mind is a terrible thing to close, and uncertainty is actually a key to generating the value of knowledge. Ultimately, the important thing about "knowledge" lies in what knowledge makes you do.
Posted by Malcolm Ryder at 10:42 AM
April 29, 2008
Information Overdrive
Profitability through information management gets fresh illumination and color on Page 8 of the March 2008 issue of BPMStrategies, where Tom Dwyer, VP of research for the Brainstorm Group, walks us through a 21st-century operational blueprint in his article, "Using BPM, BDM, and SOA To Create A More Agile Supply Chain".
In the Brainstorm illustration on that page, the title of the Venn diagram (below) suggests that a blank area in the top center intersection would have been labelled "Actionable Insight".
The question we first posed to Dwyer was: shouldn't this intersection be titled "Policy Compliance" and stand as the third factor, instead of "actionable insight"? One can readily argue that a full reckoning of profit and advantage (the very central theme) must include this risk management dimension, and it proves to be so in actual practice but simply has (typically) more influence as a constraint than as a lever.
In a brief offline interview, Dwyer replied, noting how his system works:
"The point that I was making was to identify three elements that contribute to profitability by optimizing the management and execution of a supply chain... The three I chose were all meant to be levers or enablers to achieve higher profit... [Within those three] the combination – or intersection – of intelligent applications built on a responsive infrastructure and accurate, timely data is what enables 'actionable insight'... I would agree that achieving policy compliance at the lowest cost would definitely impact profits... but I would not choose the constraint of policy compliance over the enabler of actionable insight. "
Interpreted with lots of wiggle room, Dwyer's descriptions in the BPMStrategies article strongly suggest that the role of agile technologies is to generate transparency [largely internal] across the heterogeneous organization -- while the role of integrated real-time data is to generate transparency [largely external] across the organization's multichannel embrace of suppliers and customers. Respectively, albeit oversimplified, this amounts to an organization knowing what to do and how to do it, complemented by knowing what it should be acting on and why. In both cases, timeliness of correct information is critical. But to highlight the most important issue, it is the matter of being actionable that makes being insightful worthwhile.
Additional consideration of Dwyer's formula leads to this summarization: knowledge management, business intelligence and performance management may converge to drive sustainable competitive winning, if you know how to make them converge. We view this as a matter of management information systems being deployed strategically rather than just tactically.
Strategically deployed, the information must allow the enterprise to identify and leverage its positioning, capability, and internal alignment, so as to understand whether revised operational mechanics are appropriate to the actual environment of the organization's practice.
To put this back into the proper original context of Dwyer's discussion: the improved mechanics in question are driven by business process management (BPM), business decision management (BDM) and service oriented architecture (SOA). The strategy challenge is to realize and exploit the correspondence of these approaches with the management of information. For example:
Development: SOA : Process efficiencyProduction : BPM : Performance Effectiveness
Research : BDM : Actionable Insight
In a follow-on to this discussion, we could consider the recently published arguments in The New Age of Innovation by C. K. Prahalad and M. S. Krishnan on how global resource networks represent the new supply chain mechanics and how the arguments express the information/mechanics correspondence. For example, in the coverage of the book provided by Information Week's Bob Evans, the key idea noted is that Darwinian forces of customer-centricity require transformation of a supply process into a service, causing the B2B (business-to-business) supply chain linkage to operate more in B2C (business-to-consumer) mode -- which changes the kind of information necessary to manage success. Says Evans: "resources must be shifted continually... " and "processes must be shifted from a focus on millions of customers to the individual."
Punchline: for many enterprises, the prospects of future success resemble hitting a moving target from a moving launchpad. To be able to execute that strategy, there will first need to be a strategy for enabling the execution.
Posted by Malcolm Ryder at 7:09 AM
April 26, 2008
Inciting Insight
It's customary to eschew information overload; but the key to their useful combination is not the specific information compared, rather how the available information is positioned in the overall scheme of interpretation. As seen in the picture above, intents and impacts which superficially represent "how things are going" will relate in terms of the "5 W's and How". Seeing the certain blending of factors here, it is easier to realize that most insights will be moments of correlation that are the prize for maintaining ordinary but diligent awareness in a variety of ways.
But just like money, insights are mainly worth the use to which they are put. So, whether this big picture describes the competency of an individual savvy person or of an enterprise, it tells something about being strategically capable but the goods are in the doing after the learning.
Posted by Malcolm Ryder at 6:15 PM
Time Out in the Garden of Good and Evil
The problem with the media is all in the mediating.
Credits: thanks, or maybe not, to Rupert Murdoch's Wall Street Journal.
Posted by Malcolm Ryder at 12:26 PM
April 19, 2008
The Innovator's Real Dilemma
Jessica Stillman at the new BNET1 blog rounds up research from Accenture, the Conference Board, and Wharton to talk about why Fostering Innovation Stumps Executives ...
This is an interesting situation to ponder: making choices about how much to invest in innovation , versus in knowledge management and, separately, business intelligence as other paths to insight. Overall, what the organization is mainly after -- where the real money rests -- is the insight, whatever the path. But the current thinking about management priorities indicates that insight is pretty hard to come by, so lesser-beaten paths to it are also getting a lot of attention.
One challenge that surfaces, somewhat amusingly, is the presumed need to be innovative about how to foster innovation. For example, given that "innovation" is so easily approached as "creativity", it is not surprising that at places where real urgency comes from competition against either industry rivals or the budget, the idea of stimulating the worker's right brain with art experiences can gain some real traction.
But perhaps everything new is old again... The simplest way to assure that innovation is "fostered" is to provide
(1.) a clear statement of why the company will consider something to be "innovative" and...
(2.) a clear statement about what circumstances will cause the innovation to be rewarded in a way that directly benefits the individual(s) involved.
Generally, if company leadership can't get that much communication together and abide by it, then most other "fostering" efforts are essentially arbitrary.
Furthermore, this effort should not be confused at all with management's concern about how to measure the innovation's impact on the company's performance. The performance impact issue is not something that should be making innovation special. Any management team that rewards "performance impacts" with bonuses should simply add innovations to the mix of things that can be clearly accounted for as contributors to better performance. Meanwhile, innovation is about doing things differently to create opportunity; but execution is about doing things a certain way to hit performance targets.
This is where managers have to get real: if they will not reward innovators for being innovative, as opposed to making the reward conditional upon performance increases, then people will learn that innovation is not worth the effort at this organization. So in step (2.) above, the "circumstances" to be declared must start with something other than performance metrics.
Posted by Malcolm Ryder at 8:42 AM
April 3, 2008
The Circumstantial Strategist
According to Edward Cone, in his CIO insight article CIO: The Accidental Strategist, most companies claim that information technology is strategic to their business.
This seems like a no brainer; competitive business is primarily a matter of matching a determined need with a defined opportunity to serve the need, and neither side of the equation can be handled at the necessary combined volume, speed and cost of sustained competition without IT.
But, says Cone, according to research by Diamond Management & Technology Consultants, IT executives say:
- just one-third of the execs play a significant role in the strategic planning process at their companies
- only about one-quarter of participating CIOs spend up to 50 percent of their time on strategic issues
- barely one in 10 spend more than half their time on strategy.
In other words, the average actual occasions of direct CIO influence on strategy amount to only about 1 out of every 16 CIO person/hours -- approximately one short morning a week.
Averages are good at promoting distorted mythologies, so having put that one out, let's immediately begin to ignore it rather than repeat it. But from the observations in Ed Cone's article -- in which several variants of "The CIO" are posed for inspection by actual CIOs and by industry management gurus -- a few other points jump to my mind:
- First: the article's title may have been more apt if it said, "The Circumstantial Strategist". The territory being covered is not so much about why CIOs should do strategy, but instead about how CIOs get to do it. Along those lines...
- Second: CIOs who report to CEOs have a fundamentally different "lay of the land" than do CIOs who report to CFOs or COOs.
- Third: A CIO doesn't have to see the whole company to be strategic; he or she has to see the whole information architecture on which relies a business operation that is directly accountable to a CxO. Certainly there are enterprise CIOs, but not all strategy is enterprise-wide. In fact, many companies have more than one CIO.
- Fourth: CIOs are often in a position to recognize an IT opportunity to alter the business model. But there is a huge difference between having (a.) both the responsibility and authority to do it, versus (b.) only the opportunity. The politics of the internal corporate governance effectively draw the boundary around the CIO's effective role. What's probably more interesting than the "CIO" title is what the other CxOs have agreed is the range of the so-called CIO role.
Posted by Malcolm Ryder at 2:47 PM
March 30, 2008
Careful What You Ask For...
Anyone who has visited Archestra more than once ( all nine people! ...well, ok, eight not couting myself) knows that a major point getting made is this: what looks like problems without solutions is often due to the romantic allegiance we have to a misleading vocabulary.
It's especially important to catch those times when strategy, management, execution, and other fundamentals are being wrestled by name. In that vein, one of the longest-standing friends of Archestra -- Bruce MacEwen at Adam Smith, Esquire -- caught the notice (again) of a somewhat newer friend -- Jack Vinson at Knowledge Jolt -- setting the stage for the commentary now here.
Bruce starts it off by reviewing ideas in the The Halo Effect, by Phil Rosenzweig. Rosenweig explores the historical ineffectiveness of management guru wisdom, and Bruce shortly comes to his own punchline: "In this unknowable world, what attitude and what approach grace us with the best odds of success? Only one: Critical thinking."
But as you read Bruce's fluid argument to the conclusion, you pass through the equally important question in his theme: "What do you have to know, to be the best performer?"
Jack, a seasoned spokesman for the Theory of Constraints (TOC), embraces Bruce's conclusion; but moreso he picks up that earlier question with his own followup, posing a perhaps ironic counterargument to Bruce's conclusion. With no pretense of being gurus, both men argue for the value of logic to management that would aspire to the top rung of performance. But Jack shines a light in the dark corner of logic's chronic problem with gaining broad acceptance. Case in point: Jack's observation that TOC works but still doesn't proliferate poses this question: "What does it take to get chosen as the management approach?" And our question, naturally, becomes "if you aren't chosen, then how can you be the key to success?"
Evidently, what it takes to be chosen is a combination of marketing and politics -- and the facts may be that the underlying genius of "success" is not the management approach used but instead the competitive approach employed by the executives. What Jack points out, intentionally or not, is beautifully brutal: that sometimes things work and sometimes they don't. And we must remember that winning ugly is still...winning. TOC companies may be winners, but most winners don't use TOC. (True, or false? Jack suggests, True.)
Consequently, when it comes to competition, we can't be sure that a great lot of companies should do anything in common; but instead we have to focus on why something works for the company that it works for.
In other words, there is a glaring difference between strategic management and competitive strategy, with the better competitors doing most of the winning, not foremost the better managed.
What executives must be responsible for is figuring out what strategy their company can win with; and what managers must do is figure out whether the company is doing what that appropriate competitive strategy calls for.
As both Bruce and Jack assert, critical thinking ought to be a key tool, and here we assert that it is a key tool in both competition and management. But what overrides both circumstances is the possibility that the thinking will be done about the wrong thing.
Eschewing mythologies and the emperor's new clothes, Jack quotes Bruce's counsel against that problem : "rigorous and unblinking analysis of reality as it is, not as you want it to be..." What we must take this to mean is not that some approach is inherently more competitively clairvoyant than another, but instead that executives and managers must not run the company based on a mythology (of an approach) that does not fit the company. To puncture the mythology, you have to be able to cut through the marketing and politics that surround it within the company.
New punchlines: as the top person in charge, you can't know what strategy will be your most successful against the competition before you know your organization; and when you reach an understanding of what your organization can do, you then have to either select a strategy that fits the organization, or you have to change your organization to fit a different strategy. What's tough is that you have to do this while the game is already underway.
Posted by Malcolm Ryder at 1:53 PM
March 23, 2008
I'ma Get Open Source on Yo' Ass
Yahoo joins Google and builds a nonprofit to run OpenSocial so that the OpenSocial developers can have a freezone for exchanging "intellectual property assets" without a moola market. As the Associated Press stated on the Yahoo website, "the idea behind the Google-initiated OpenSocial platform is to create a common coding standard for the ['social tools'] applications so they work on hundreds of Web sites."
We decided to look up the meaning of "tools" to be confident of the richness in the breaking story. Using Yahoo's search engine, we kept coming up with entries like this exemplary one from Dictionary.com:
tool - noun: a person manipulated by another for the latter's own ends
No avoiding the thought that Yahoo would now be Google's tool; so we used Google's "Web Definition" search functon to see what happened. The search on "define tool" ripped in under two seconds to the most appropriate place we can think of, the socially open Urban Dictionary:
1. tool 4455 votes up, 517 votes down
One who lacks the mental capacity to know he is being used. A fool. A cretin. Characterized by low intelligence and/or self-steem.
3. tool 1708 votes up, 443 votes down
someone who is a complete idiot/ one who is used by other people, and usually dosen't even realize it/ someone who can't think for themselves/ an asshat.
People who wear huge logos on their shirts are tools.
This would be a good moment to mention that Google has given up its rights to the OpenSocial branding, as part of the deal. No fools in Gtown central.
Clearly you can be a tool without being a social tool; so how wack it is that three of the most powerful companies in the free world are aggregating the tools. This might make them social, but a better question is this: does going social on a social network make you a tool if you weren't one already?
The sports pages of the conventional business press can be expected to focus on that, backhandedly, in their ongoing coverage of the market strategy smackdown between the G force and MondoSoft. But of course, that's hardly the key story.
The key story will be the one that inevitably will break on the non-profit NPR when someone looking for a job at Google tries to sue Google for using their social site residue as an excuse to not hire them -- residue found on hundreds of websites thanks to the easy proliferation path of OpenSocial.
"So, Mr. Lovitz; how do you explain your involvement in this August 2007... occasion... at the Omega Hip VIP room?"
"Uhh... Acting!"
Posted by Malcolm Ryder at 6:42 PM
Suddenly, It All Made Sense
Finally, that track that everything went off of, and where to get back on.
For the hi-res view, click here and go full screen or print.
Posted by Malcolm Ryder at 6:42 PM | Comments (0) | TrackBack (0)
March 18, 2008
The End of Irrational Execution
Faisal Hoque, Chairman of BTM, appeared in Baseline Magazine with a brief discussion on the three elements needed for "Transformation: Inertia to Agility" (BTM innovates new business models and enhances financial performance by converging business and technology.)
As usual, Faisal offers a wonderful summation of what levers to throw and why to throw them. Here, he observes innovation, efficiency and abandonment.
Sound familiar? Perhaps the most interesting aspect of his article's proof point -- Amazon -- is that it shows how far we have recovered from the dot com era assumptions, particularly when it comes to understanding that in a business we actually have to get paid for making people happy. What Hoque really pins down, though, like a refreshed road marker, is that the "making" part is not the business, but is instead the competency.
Amongst the problems in the mix, the inertia that Faisal details is arguably the description of how business frustrates competency (“We have to meet this quarter’s numbers or we’re toast.” ), while on the other side of the coin Hoque highlights how competency, through enterprise architecture, can drive a business ("the first step is to get a clear picture of the entire enterprise...").
Meanwhile, that flashback we easily have on older preached wisdom like "Fail Faster!" and "Destroy Creatively!" still seems to apply, but the difference is that we have actual history on that now. The history begs the question, "why are only the exceptions successful?" Hoque's answer looks to be a turnaround on the old saying "If you don't know where you're going, it doesn't matter how you get there..." The turnaround is, "If you don't know how to get there, it doesn't matter where you're going." But we can't make the mistake of joining the casual crowd exuberance for "execution": the point is that enterprise architecture is the competency enabler that then delivers execution for the business.
Posted by Malcolm Ryder at 9:01 AM | Comments (0) | TrackBack (0)
March 16, 2008
Innovation by CIOs: the Same Old Same Old
Proposed: Business is built on IT, and CIOs know more about what IT could offer to innovation, so they should drive the innovation.
On the one hand, it looks good on paper. It's not new, but it seems to make sense.
On the other hand... wait, where IS the other hand?
The CIO Insight Discussion hosted some talk from industry analysts Forrester and kicked off followup commentary.
Reader Jon McAdams had left an earlier comment there that saved the rest of us some writing... So I'll segue from some of what he was pointing at.
CIO's who don't feel very "chiefly" should rightfully question whether their compensation is in line with how they'll actually be measured. But in the world of performance measurement, speaking truth to power is personally relatively expensive. How do you afford it? There's the dilemma.
Proposed: Any CIO who wants to use the word "Innovation" more than once a business quarter should be prepared to provide the definition of what innovation is, by distinguishing its flavors from each other: the planned, the authorized, and the actual. If the CIO is a decision maker in all three dimensions, then there is, fortunately, no dilemma; there's just execution.
But in execution, there are two tracks to follow: priority, and production. If the CIO is not being paid to decide and validate their alignment with each other, then again there is, unfortunately, no dilemma. There's just the matter of whether other people around the CIO want to know what's real or not before they take the actions they actually take.
Let's face it, giving action orders to the "head of IT" doesn't require having a CIO or being realistic. Meanwhile, getting orders can be done with one hand tied behind your back. But being held responsible for the consequences of someone else's higher up decisions is clearly not a prescription for being the chief.
Posted by Malcolm Ryder at 10:59 AM | Comments (0) | TrackBack (0)
February 23, 2008
Wee hours in the Garden of Good and Evil
For 2008, my official pet peeve will be Fashion Stuttering.
Fashion stuttering comes in two flavors, one more henous than the other. The first sneaks up and whacks you in the head. The second is more direct.
How often is it that, from people who have been given a podium for pronouncements, you hear it said, "... and the thing is, is that
The second and more criminal fashion stuttering, more overtly theatrical and less of a brain seizure than the first, is when people perfectly competent at the efficient oral delivery of a sentence shoehorn it into an affectation of actual physical stuttering instead of just spitting it out. This takes place for dramatic effect, signifying that the thought being uttered is in the heat of the moment so emotionally exciting that it is actually mildly disturbing to the speaker's composure. For a speaker who we well know has no chronic stuttering affliction, the thing is is that the adopted stuttering bestows a brief aura of urgent candor that we are supposed to note is more important to accept at face value. Apparently, the best time to use it is when you want to have the last word on the subject, so you save it for then, accompanied with a slight throwing up of the hands to indicate a resignation to inescapable facts. Otherwise, it is used mainly for flirting. Hmmmm.
All that said and explained, you should never call someone out on these behaviors, unless you would like them to never speak to you again.
Posted by Malcolm Ryder at 5:19 AM | Comments (0) | TrackBack (0)
February 6, 2008
Proof Politicizes Architecture
Management requires an ongoing accountability for effectiveness. Normally, this accountability is the recognized set of terms for "proof". The accountability includes some model of measures, and while the model may be good or bad, the agreement by interested parties to use the same model makes it the argument that counts the most, even if it is wrong.
The model then represents the ruling hypothesis about effectiveness and, in short, memorializes the belief system in place about how to make progress. This fuels, in turn, a prevailing culture of proof that casts its influence over the several necessary layers of enablement that allow for effectiveness to result. The problem is that this influence may be inappropriate, and to avoid being misled by it we need to know why.
The answer is that the layers of enablement are variables, and the combinations of their variations offers more than one path to effectiveness. To describe an occasion of how effectiveness resulted, we would monitor variations within threshholds on as many as seven layers:
- Effectiveness is usually a measure of the degree to which an actual outcome matches a desired outcome.
- But the outcome is a strength of reaction to an impact generated by some agent.
- The level of impact observed can itself be more or less than expected, or desired, or needed -- and often there is insufficient attention paid to distinguishing the three characteristics (which is what allows the seeming inevitability of unintended consequences).
- The cause of the observed level of impact is a state or an output.
- The agent of that state or output is a quality level of process.
- The runrate of the process consumes inputs.
- The level of supply of inputs allows the processing.
In this view, the bottom four layers predispose whatever can happen in the top three, which is why the bottom four are so routinely captured by the design of an architecture. But if the architecture is unfamiliar or expensive, the distance between layer 4 and layer 3 is quite large. The burden of proof will fall to the architect to demonstrate bridging the gap.
With some "proof-of-concept", the effort is made, but it must be accompanied by its own "concept-of-proof" that relieves it from the pressure of "measuring up to" the top two layers.
It takes gutsy decision makers, or ones with little to lose, to accept this -- rather than to impose the top-line measure as the justification for considering the architecture at all. Innovators and early adopters accept their proof points at level 4, while laggards are hard pressed to dig below level 1. Consequently, the architecture in question gets positioned on the spectrum somewhere between demonized and championed.
Posted by Malcolm Ryder at 10:37 AM | Comments (0) | TrackBack (0)
