Speed is the new IT currency

In today’s competitive markets, businesses must be fast. Technology needs to deliver against user needs – and do so quickly. How about your organization? As CIO, how quickly can your IT team complete a new function implementation – the throughput improvement business users now demand? How quickly can your team change a function, demonstrating the agility business demands?

That was a problem for one of America’s top 10 banks. As with any financial service organization, the bank was process rich. “The problem with that is that we can’t get things done,” its CIO told me. “There are different processes we have to go through and different committees we have to get approval from, and it takes forever.”

Even so, he succeeded in driving the bank into the Digital Age. where speed is the new currency and time counts more than ever before. Prior to this transformation, the bank had a typical enterprise IT model where the currency was “dollars.” The focus was unit costs and how to do more with less.

As many businesses grappled with the “more for less” demand over the past few years, they sent work to India where labor was cheap. And they invested in ITIL because it enabled improving quality while reducing operational costs. But ITIL’s very structured set of processes takes too long.

The bank’s CIO discovered that the biggest driver of costs on a digital project isn’t the cost of the people. And it’s not the cost of the technology. It’s the amount of time the project takes.

Here’s the reality: You can use expensive people and expensive technology; but if you complete the project quickly, it costs a fraction of the cost to do it with lower-cost tech and people over a longer period of time. Speed kills cost.

Remember Johnny Weissmuller, one of the world’s fastest swimmers, who won five Olympic gold medals and set 67 world records in the 1920s and later played Tarzan in the movies? How did he maximize his swimming speed? It wasn’t from increasing his number of strokes per second or by kicking more. Turns out that technique can burn energy and slow down a swimmer – a lot like what happens to an IT team churning through the process-rich environment that slows down projects.

Weissmuller’s technique for increasing speed was a powerful high-elbow underwater pull and synchronizing his arms and feet. Because he moved more water in this manner, he maximized his speed.

That’s basically what the bank CIO did as they moved into the Digital Age. They leveraged the power of automation for some work; but, even more importantly, they leveraged the power of agile processes and methodologies such as DevOps that drive fast interaction.

Here’s the bonus from moving to a faster process – cost comes out in an incredible manner. Like I pointed out earlier, speed kills cost. An example is a different bank with which we at Everest Group worked as they focused on moving to a continuous release cycle instead of releases once or twice a year. Through integration across their IT stack, they not only reduced their apps release cycle time by 30-40 percent and reduced test time by 30 percent, but the increased speed yielded $600 million in savings over three years.

When we elongate the time period of a project, we dramatically increase the cost. Speed cuts costs in a way that can’t be done by reducing unit prices, buying technology for less or sending work to a low-cost labor location.

CIOs’ challenge in the Digital Age is to shift IT management from process execution to business value. And speed is the currency in that objective.