Class notes - week sixteen, Spring 2018

Final week of class

Table of contents

Notes from IDSC

The first half of the final class session featured a guest speaker who has worked as in CIO roles for several companies. By the end of his talk the room was focused and it was apparent that we were in some rarified air

Guest lecture

  • Likes to use the talk to encourage everyone to be good stewards of technology
  • You cannot escape IT. Needs to be part of your frame of getting work done in all areas of modern business.
  • Companies have been wrestling with the question of how to make strategic use of IT. How do we leverage IT to make a difference in the marketplace?
  • How do we get to being strategic users of technology? Some prerequisites as a company:
    1. Stabilize
    2. Simplify
    3. Transform
  • How do you determine what is good when you think of stabilize? It’s the servers, the networks, all of the plumbing and the backbones
  • Our definition of stability is important. Going overboard in this regard can detract from higher level priorities. Stability is important, but need to work with business leaders to define this within reason to balance business needs with resources
  • Idea of simplification
    • Making it easy for people to use
    • Standardizing and streamlining systems, make it easier to manage and build a platform that works together
  • You’re trying to create a customer experience. When systems don’t work well together and that causes customer headaches, that damages your brand
  • Even though simplification ends up with fewer systems, that’s not the purpose. The purpose is to simplify business processes. Examination of the business process is the starting point
  • Ask where we’re being redundant with our business processes.
  • Map it out via process modeling
  • It can be an excruciating process, there will be resistance.
  • Any time you make a drastic systems change, somebody will feel that they are losing something in the process. Getting people to be comfortable with the change, putting it in perspective, ensuring that they know there will still be a role for them (sometimes provided that they’re willing to embrace change and learn new skills), showing them all of the things that the change will free them up to do - these are the challenges.
  • How do you articulate what that change message is, and how it’s the right thing for the company to do?
  • Life affects people at the level at which they work, not at the underlying systems level.
  • The culture of the company matters a lot in this context of change. Most companies who are successful at this are skilled at communicating to people that change is hard and we will support you through that
  • One of the trends in industry now is towards platforms. Way back in the day it was common to build in house, then an age of of-the-shelf software, now there are off-the-shelf programs which offer the ability to interface with third-party and custom modules. Vendors are becoming more savvy in terms of realizing that one size doesn’t fit everyone.
  • Any time you allow any software development within a platform, needs to have a governance process. Anecdote of how Salesforce was implemented as a common platform, but then encountered a proliferation of custom apps built within it. Has to be managed.
  • At the heart of transformation is the question, what business problem are you trying to get technology to solve?
  • Buzzwords can be a technology chasing a problem. Need to approach it the other way around
  • Challenge assumptions, ask how new approaches can solve old problems
  • If you frame the problem in the right way, with stability and simplicity in place, transformations are possible
  • Two takeaways:
    • Our jobs in our companies are to find what business problems or opportunities there are to solve. Senior executives everywhere don’t have this figured out, they’re not seeing what you’re seeing everyday, and they’re hungry for you to bring forth ideas for improvement and recommendations for technology that can meet it
    • You don’t have to think about global enterprise terms to make a difference. Can start in a smaller context, look at your local office and how you can make impacts in the periphery of what you can control

Remainder of class

  • Platforms are really the emerging area of strategy
  • Spectrum of business models with pipeline on one end and platform on the other. It’s not binary, can decide where on that spectrum your company wants to be
  • Thinking in terms of platforms is very powerful
  • Question about if there’s any scenario in which it only makes sense to have a pipeline and not have a platform. Prof thinks that the days of having only a pipeline are limited, because whenever they come into conflict with a platform the platform wins
  • The real question is what is a platform - set of shared components which can then be expanded by third parties, and where use is subject to network effects
  • Types of network effects:
    • Cross-side: preference for number of other users on other side
    • Same-side: preference for number of users on same side
  • Remember, network effects don’t have to be positive, can sometimes be negative
  • A platform becomes a very flexible thing with multiple sides
  • Platform strategies can backfire. Value of the platform is the value the data that you are a custodian of. If you betray your customer’s trust, there will be trouble.
  • The capabilities needed to manage a platform are very different from the capabilities needed to manage a product
  • A platform company is basically a middleman, which is very different from an R&D type of company
  • Key value of a network effect is the ability to leverage the innovation of third parties
  • Pay attention to this stuff. The notion of a platform is likely to become very important
  • Closing thought for the course: Technology is too important to leave just up to IT. Encourage everyone to take charge with what’s going on in your company about IT and leverage the capabilities.

Notes from MGNPO

There wasn’t much new to say from the last week of class, we reviewed concepts from throughout the course. I jotted down a few broad takeaways

  • We’re finishing 15 weeks of learning about governance and management
  • About every five years an organization need to catch its breath, scan the environment and reevaluate its position
  • Go to function first, then structure. That’s a critical concept that it took a long time to understand as a new CEO
  • There’s no one unifying theory for nonprofits. Most common one used is the principal agent theory. Second one is resource dependency theory. Followed by government failure theory
  • Concepts of equity and ethics sort of slide around each other
  • Just because something is legal doesn’t mean it’s ethical
  • Almost always, staff will follow you with a change if you tell them the reason why
  • Whenever you do an employee review, ask them what’s motivating them. It’s usually not money. And what motivates one person isn’t always a motivator for another. Don’t assume anything about personnel, need to ask
  • Two resources that every nonprofit executive needs to pay attention to: people and finance
  • Cashflow and forecasts = early warning system for decision making
  • When we get too sucked into the day-to-day survival mode, can become blind to oncoming disruption. Branch out and talk with people outside your usual circles.
Written on May 1, 2018