by Mike Hugos

Three Steps to Build Systems For Your Midsize Company

Feb 15, 20066 mins
Enterprise Applications

In my personal life I am an easygoing guy. I like to take long walks through my Chicago neighborhood, which is downtown by Lake Michigan. I like to sit in a coffee shop and read a good book or visit with friends. In my professional life, however, I have been accused of being as easygoing as a drill sergeant. I am a CIO who is passionate about designing and building IT systems that drive business success.

What gives rise to this change of personality? It is the urgency I feel about getting things done. In the very competitive and fluid global economy in which we all operate, a key aspect of CIO leadership lies in ensuring the agile and innovative use of IT. There’s no magic to this. To paraphrase a famous quote from Thomas Edison, the agile and innovative use of IT is 5 percent inspiration and 95 percent perspiration.

Let’s talk about that 95 percent part. It means a lot more than just working hard. IT leaders can create a fast and flexible process to develop and deploy new business applications. That process has to enable agility by showing IT employees how to move forward in quick, focused steps. Since all jobs expand to fill whatever time is available, an agile process requires you to set an appropriate time frame for getting things done and then shape the job so as to finish it within the time available. Agility means that you are faster than your competition. Agile time frames are measured in weeks and months, not years.

Similarly, IT leaders can use process to boost innovation. An innovative process calls for people to feel a sense of urgency in order to overcome the inertia of doing things the same old way. Placing limits on the time and money that your employees can spend to solve a problem is a great way to create urgency. In the past, I have challenged my IT staff to create solutions that cost 10 times less than what our competition is spending and that can be developed four times faster—what I call “10-4 performance.”

Three Steps to Agility and Innovation

Agility and innovation is a frame of mind that starts with the CIO. It’s your job to put the proper process in place and make sure people use it. I have created my own three-step process called “Define-Design-Build.” It’s a simple and easily understood guide through the three steps of developing any new system or business process.

Each step produces a well-defined set of deliverables and has tight time boxes and budget guidelines. You can probably figure out for yourself what deliverables should happen in each step. (E-mail me if you want my list.) More important is the way that this process enables agility and innovation.

The Define step takes two to six weeks and costs 5 percent to 10 percent of the total project budget. The Design step takes one to three months and costs 15 percent to 30 percent of the total budget. The Build phase takes two to six months and costs 60 percent to 80 percent of the total budget. You may ask how I know these time frames without knowing the specifics of a project. My answer is that there is only that much time available if you are truly going to be agile. If your employees can’t define what is needed within two to six weeks, then it certainly won’t be an agile project.

Likewise, I know the design work will cost 15 percent to 30 percent of the project budget because if people are spending more than that, they are designing something too complex. More expensive projects will take longer than one to three months to design and then will take too long to build. In sum, if the work cannot meet these requirements, stop the project because whatever is being done is neither innovative nor agile.

How to Achieve 10-4 Performance

Here are some other things I have emphasized in the Define-Design-Build process. First of all, every project needs a full-time person in charge who has the skills and authority to get things done and is totally committed to success. I call that person the system builder. Without such a person, no project can succeed. Make sure you have a good system builder for every project you start.

Next, build robust, “80 percent” solutions rather than seeking perfection. Avoid the temptation to overengineer your systems in an attempt to handle every possible combination of events. Trying to build systems that can handle everything increases the cost and complexity in an exponential fashion. Instead, develop systems to handle only the routine, day-in, day-out transactions, and have people, not computers, handle the exceptions and the one-off occurrences. This is how you build systems for 10 times less than your competition.

Remember that big systems always constitute a collection of smaller subsystems. So once the Define step is completed, big, multimillion-dollar projects can be broken up into smaller projects to develop each subsystem. Instead of having one big project team design and then build everything, this arrangement allows multiple smaller teams to design and build subsystems in parallel, under the overall direction of the system builder. This is how you get things done four times faster than your competition.

At first people may accuse CIOs who adopt a process such as Define-Design-Build of being overly demanding and unreasonable. I admit my three steps have also been called “Move it! Move it! Move it!” But do not relent. What you ask is possible—IT groups can achieve 10-4 performance levels. Give people the training they need and the opportunities to learn by doing, but do not lower your standards or extend the time frames.

As your employees learn the process and become adept at using it, you will see a change. People will develop an air of self-confidence and a positive, “can do” attitude. My IT group at Network Services, a mid-market company, was recognized with two CIO 100 awards in a three-year period. Agile and innovative IT enabled my company to grow revenue by more than 20 percent each year during that time.