Lean IT should be at the heart of a digital transformation

Information technology research firm Gartner calls IT “bimodal.” In other words, it divides IT delivery into two categories: one type of IT is conventional, slow, and its main purpose is to support current operations; while the other is disruptive, agile and focused on finding new digital businesses.

Some Digital Age enthusiasts mistakenly consider lean an approach that is dedicated solely to efficiency and are quick to label it as something outdated that is only relevant to conventional IT (the first mode, if we use Gartner’s categorization).

In my mind, this view is very limited and shows a lack of understanding of how modern management has evolved. One of the first management consultants, Frederick W. Taylor, firmly believed that an effective company could be created by breaking a job down into separate tasks and identifying the best way to do each of them.

Specialized functions as we know them today (and IT is certainly one of them) are the result of this type of managerial thinking. However, digitalization is proliferating, and information can now be shared much faster (often in a matter of seconds), which makes the work environment more complex than ever.

As a result, the command-and-control approaches that were once so powerful in business are starting to crumble. What has become stronger instead is the idea that lean thinking is more useful in a digital business transformation than the principles of traditional management, thanks to concepts such as systemic awareness and the learning organization and its focus on statistical data analysis and transparent information sharing (which brings Toyota’s jidoka principle to mind).

As General Stanley McChrystal says in “Team of Teams: New Rules of Engagement for a Complex World”:

“Efficiency remains important, but the ability to adapt to complexity and continual change has become an imperative.”

That is why lean is the ideal methodology to ensure that IT plays the role it deserves in a digital transformation. And this applies to both IT “modes”: for legacy, conventional systems, lean can improve efficiency, speed, cost levels and stability, while for new digital efforts it can enable experimental learning, transformation capability, cooperation and the unlocking of business opportunities.

THE LEARNING CHALLENGE

Today, organizations face the urgent challenge of having to discover new paths to innovation and find new IT-based business opportunities (I am thinking of revolutionary businesses such as Uber).

In order to turn innovative and transformative ideas into successful businesses, you need to fully integrate the IT function with the rest of your organization and ensure that the two cooperate. And even that may not be enough: you also need to involve your potential customers.

When designing digital services, PDCA rules the game: this is how we can test business ideas with customers and learn to fail quickly and cheaply (the iterative nature of improvement and learning that characterizes today’s digital transformations reduces the risk inherent in making an investment) when ideas do not deliver on their promise.

HOW TO TURN SILOS INTO A SHARED UNDERSTANDING

The strength of conventional IT lies in the fact that its people know every step and part of the system, which is critical for any lean transformation.

The overall purpose of such a transformation is to create end-to-end flow that cuts across silos. In today’s organizations, however, the product that flows is not physical: it is information (which, for example, is transferred and manipulated in applications or stored in databases).

IT has all the knowledge needed to help simplify this flow, collect data on cycle times and reveal the previously invisible digital work in process.

It is your responsibility as a leader to ensure that there is a broad understanding of the flow of information and of the purpose of the organization as a whole. That is why I believe that physical and digital obeya rooms are crucial for providing transparent information and making decentralized decision-making possible. Somewhat paradoxically, notes on Post-its, whiteboards and daily meetings are still more effective at creating a common understanding and a culture of collaboration than strictly defined job descriptions, organizational charts or data-sharing applications.

It is very likely that your IT department already uses popular methods such as scrum, agile, devops or kanban, which means there are already people there who know the concepts of flow, work-in-process reduction and visualization. I am sure IT will be happy to share its insights on current business challenges - and you should listen to it!

Lean thinking is a strong foundation for your digitalization efforts. It can and should be used as a disruptive strategy to transform IT, not in terms of technology (which is already available), but in terms of management mindset.