Professional Documents
Culture Documents
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KEY FINDINGS
Executive Summary
Change has become a constant. From an organizational perspective, few would 4. Create Conditions in Which Productive Peer Learning Is More Likely to
argue with this statement. For IT teams, the upheavals we outlined in our Occur—Agile employees are different from their non-agile peers not only in
recent study on The Future of Corporate IT suggest that the pace of change having more peer connections but also in using those connections to actively
will only accelerate. learn.
It can take more than two years for employees to recover from a significant 5. Provide IT Staff with the Right Tools to Adapt and Learn—The role that the
organizational change. But in a two-year period, 65% of organizations leadership team plays in driving agility is different to that which simply drives
experience multiple changes, so employees never have time to catch up. buy-in, so prioritize coaching, connect employees to the right people, and
What does this unending change mean for employee performance and seek employee feedback.
commitment? And what does it mean for traditional change management and 6. Agility Requires Collaboration Across and Beyond IT—Building agility
communications strategies that approach change as a one-time event? is a cross-functional effort. HR must reshape hiring and performance
To address these questions, the Communications Executive Council management models, communications must be positioned for problem
conducted in-depth quantitative research with almost 1,600 employees at solving, strategy should be flexible and transparent, and technology must be
large organizations globally. As part of our commitment to giving IT leaders used to foster collaboration.
access to world-class insights from beyond IT, this document summarizes the
implications for CIOs.
1. The Changes Facing the IT Organization Negatively Impact Employee
Engagement—Organizational redesign has a negative impact on
engagement capital that takes more than two years to wear off. Employees About the Business Insights for IT Initiative
are experiencing change fatigue and are unable to recover from a change The Business Insights for IT Initiative is designed to help IT leaders
before the next one kicks in. work effectively with business partners and to learn from best practices
2. In an Environment of Ongoing Change, Agility Is a Far Greater Driver of developed across the executive suite. The initiative harnesses the collective
Performance Than Effort or Responsiveness—Agile employees are better wisdom of CEB programs serving executives in more than 40 functions.
able to adapt to a changing environment as they are in control of their It also offers a unique lens into the perspectives, priorities, and IT demands
own response. They proactively adapt to change, learn from others, seek of functional areas such as Sales, Marketing, HR, and Finance.
feedback, and support their peers. You can access other resources from the initiative at
3. Arm Employees with the Information They Need to Solve Problems—To www.cio.executiveboard.com.
build agility, communication strategies for IT restructuring must focus on
sharing information that helps employees develop solutions on their own
instead of only fostering buy-in.
3
IT organizations face
five radical shifts in the
FIVE SHIFTS THAT WILL DRIVE RADICAL CHANGE IN IT
way they create value
and in their ownership,
structure, and role across
the next five years.
4. Pressure for Central Control Greater Business–Partner Responsibility—Business unit leaders and end
users will play a greater role in obtaining and managing technology for
themselves where differentiation has more value than standardization.
4
The changes facing
IT organizations have
NAVIGATING UNCHARTED TERRITORY
a drastic impact on
IT employee skills, Estimated Changes for IT Employees
objectives, and
effectiveness.
Business Analyst IT Strategist Demand for these roles may
to Grow
almost double by 2015.
As a result of the five shifts
Roles
■■
Business Architect Process Analyst
described in The Future of Information Architect Security Manager
Corporate IT, the IT strategist,
IT Auditor Service Manager
service manager, and
information architect roles
will see the greatest rise in
importance. Account Manager IT Financial Manager Demand for these 10 roles
to Transform Chief Architect Program Manager
will stay constant, but they
will change significantly in
Roles
Specialist
Seven IT–related roles that
For more on these findings, Collaboration and Social Technology Broker will be required in 2015 do
please see the CIO Executive Media Evangelist not exist today.
Board’s research study, The IT Head of Multifunctional User-Experience Guru
Talent Implications of the Future Shared Services
of Corporate IT. Information Insight
Enabler
CIO EXECUTIVE BOARD
IT PRACTICE
www.cio.executiveboard.com
RADICAL 1. AGILITY 2. PRACTICAL SUPPORT, 3. A DIFFERENT KIND 4. CROSS-FUNCTIONAL
© 2011 The Corporate Executive Board Company. CHANGE IN IT IS THE KEY NOT INSPIRATION OF LEADERSHIP OWNERSHIP
All Rights Reserved. CIO1169511PRO
5
It takes the average
employee more than two
NO TIME TO RECOVER
years to recover from
change. Accumulated Impact of Planned Corporate Change on Engagement Capital
Illustrative
Engagement Capital
Maximum Impact on (6%)
■■ This pace of change means Event 3
that employees do not have
the luxury of recovering fully Event 4
from the previous change (12%) Event 5
before the toll of the next
one hits them.
(18%)
■■ This accumulated impact 0 6 12 18 24 30 36
continues to send
employee engagement and
Time (Months After Initial Event)
performance on a downward
spiral.
“Planned” changes, such as organization
redesigns, have a negative impact on
engagement capital that takes more
than two years to wear off.
6
The Communications
Executive Council
A THOROUGH INVESTIGATION
conducted in-depth
quantitative research to Communications Executive Council’s Quantitative Research Methodology
understand the drivers of
employee performance
in a high-change
Council Questions 1 What drives employee performance 2 What can Communications
environment. in a high-change environment? do to drive performance?
7
In an environment of
ongoing change, agility
FINDING 1: AGILITY IS THE KEY
is a far greater driver of
performance than effort Drivers of Employee Performance
or responsiveness. Impact of a 25th–75th Percentile Move
■■ Responsiveness—following
direction and changing
when necessary—does not
Responsiveness
have a significant impact on
performance.
■■ Follow directions. Not
0.0%
■■ Change when Significant
required.
■■ Simply working harder
(effort) will get some
improvement in
performance, but it is
Agility
less than one-third of ■■ Proactively adapt.
the improvement seen ■■ Learn from others. 17.1%
by working smarter (agility). ■■ Seek feedback.
■■ Support peers.
Impact on Performance
8
Agile employees need
information that allows
EMPLOYEE AS PROBLEM SOLVER
them to solve problems
on their own. Comparison of Information Pass-Through
Finances
Finances
Trends
Trends
employee buy-in, leadership
Risks
Risks
Information Input
makes decisions and
cascades information that
explains what employees
need to do.
Finances
Trends
Risks
Decision
Communication
Employee
Solution
9
Building an agile IT
organization requires
COMMUNICATION STRATEGIES FOR CHANGE
communication strategies
to address change as
constant, not change as
an event.
From Change as an Event To Change as a Constant
Communications Strategy
Communications Priorities
What information do we Outcome of leadership decision making Input on employee problem solving
share with employees?
How does information Employees rely on leadership and Employees use their network of
flow? manager cascade for direction on what managers and peers across the
to work on and how to work. organization to share and learn.
How does Communications Craft communication that drives buy-in Help leaders feel comfortable
support leaders? to change in strategy or direction. empowering employees.
10
Knowledge and resources
that help employees
FINDING 2: PRACTICAL SUPPORT, NOT INSPIRATION
adapt to changing
circumstances drive Drivers of Employee Agility
agility; confidence in the Percentage Impact of 25th–75th Percentile Move
leadership team does
not. 11.3%
n = 1,494.
Source: CEC Agility Audit, 2011; Communications Executive Council research.
CIO EXECUTIVE BOARD
IT PRACTICE
www.cio.executiveboard.com
RADICAL 1. AGILITY 2. PRACTICAL SUPPORT, 3. A DIFFERENT KIND 4. CROSS-FUNCTIONAL
© 2011 The Corporate Executive Board Company. CHANGE IN IT IS THE KEY NOT INSPIRATION OF LEADERSHIP OWNERSHIP
All Rights Reserved. CIO1169511PRO
11
ConAgra Foods equips
employees with
PERSONAL CONNECTION: KNOWLEDGE
information to generate
solutions and take action.
FOR ACTION
ConAgra Foods’ Information-Enabling Process
■■ While many organizations
efficiently share strategic
priorities with employees,
1 2 3 4
ConAgra Foods’ process Business Support the
Determine what Demonstrate
focuses on enabling partner asks for Initiate call facilitation
information impact of
employee problem solving. communication to action. of dialogue
employees need. employee action.
plan. sessions.
■■ Their approach is most
different from typical ■■ Communicators ■■ Communicators, ■■ Business partners, ■■ Communicators and
communications plans in the partner with the with input from with support of business leaders
up-front determination of business to clarify business partners, communicators, establish results
what information to share desired outcome create a simplified lead “neighborhood” reporting in regular
and in the facilitation of and determine message to dialogue sessions communication
dialogue sessions that follow. what information help employees with individual channels (e.g.,
employees need to understand stakeholders. town halls, CEO
generate improved business need. messages) and
■■ Stakeholders
business results. recognize success
■■ Subject matter determine
stories of how
experts share their business
stakeholders
message with their role in making
created
peers and then improvements and
improvement.
with all employees create action plans.
across the
company.
■■ All employees are
invited to help
develop solutions.
12
Agile employees actively
take advantage of their
PEER LEARNING: ACTIVE LEARNERS
network for opportunities
to learn. Difference in Likelihood to Agree: Comparison of Agile Versus Non-Agile Employees
18%
15%
n = 1,494.
13
Goldman Sachs explicitly
sets the expectation that
PEER LEARNING: “REVERSE-ENGINEERED”
20% of development
efforts should focus
DEVELOPMENT PLANS
on relationship- and
feedback-based Individual Development Plan
Illustrative
strategies.
14
Laying out the
assumptions behind
MARKET CONTEXT: STRATEGY ASSUMPTIONS
strategic decisions
sensitizes employees to
MATRIX
cause and effect in the
market. Market Behavior Assumptions
Eli Lilly
Breakthrough Innovation
■■ In an uncertain market, 1 Rationing Innovation Haves and Have-Nots 2
Eli Lilly recognizes that its ■■ Tight formularies and utilization controls ■■ Health savings accounts (HSAs) are in widespread
strategy will be subject to ■■ Innovation “rationed” to patients judged most use; patients pay out of pocket for many
ongoing refinement and likely to benefit prescription drugs.
change. ■■ Restrictions on off-label prescribing by doctors ■■ Middle and upper classes can supplement employer
R&D Output
■■ Right drug to right patient through accepted HSA contributions (pre-tax and after tax) to ensure
■■ Eli Lilly shares the underlying treatment algorithms developed by credible access to new therapies; poorer consumers cannot.
assumptions behind its thought leaders ■■ Increased consumer price sensitivity and access
■■
employees and enable
new products. are covered through high deductible catastrophic
them to spot contrary ■■ Products in new therapy most likely insurance plans, so pricing pressure on these
or supporting trends. to command price premiums products is less acute.
Prescription Purchase and Prescribing Decisions
■■ This both helps employees
with their own decision Payers Rule Price Sensitive Patients
making and vastly expands ■■ Prescription prices regulated by government ■■ Employers continue to pass ever larger share of
the sources for new evidence, (price ceilings) health care costs onto employees, so patients are
enabling the strategy team ■■ Very tight formularies and utilization controls price sensitive.
to respond early to changing ■■ Big discounts to “play” on formularies even with ■■ Most seniors still have significant out-of-pocket
market dynamics. price regulation drug costs.
■■ Restrictions on promotional spending and ■■ There is a heavy use of generics, OTC products
programs (FDA speeds prescription to OTC switching in
■■ FDA focus on safety increases cost of clinical trials. many categories), and alternative medicines.
■■ Massive pharma industry consolidation ■■ A small share of population is willing to pay
premium for branded products based on heavy
direct-to-consumer marketing efforts.
■■ Companies focus on NILEX and promotional
4 efforts to drive sales. 3
Incremental Innovation
15
The role that the IT
leadership team plays
FINDING 3: A DIFFERENT KIND OF LEADERSHIP
in driving agility is very
different to that which
simply drives buy-in. Leadership for Agility1 Leadership for Responsiveness1
■■ Leadership—while unable to
“exhort” agility—still matters.
Seek employee feedback. Reward compliance.
■■ Leadership behaviors
that help form personal Prioritize coaching and support. Communicate in a directive manner.
connection, understand
market context, and facilitate Provide employees with opportunities
peer learning also drive to learn/try new things. Trust building.
agility.
Connect employees to relevant people Ensure transparency.
■■ But other well-intended and support/tools.
behaviors like transparency
fall short.
1 Attributes derived from comparing the perceptions of relatively agile versus relatively responsive employees.
16
The self-awareness
diagnostic helps leaders
STARTING WITH ME
recognize how their
Components of Leader Self-Awareness Diagnostic Components of Facilitator’s Guide
habits subvert otherwise
Illustrative
good intentions to
empower their staff. Questions for Discussion
Surface Leadership Habits in the Context of
Empowerment ■■ How could an employee misinterpret your habits?
■■ Structured self-reflection ■■ Which habits do you think could disempower
1. Decision Making your employees?
surfaces common habits,
some of which disempower When an employee comes to you with a problem,
who solves it?
employees.
What to Watch For
2. Communicating
■■ GlaxoSmithKline sources the In a one-on-one with an employee, how Hover on Disempowering Behaviors
categories and questions for specifically do you adjust your communication Warning Signs:
the diagnostic from current style in response to non-verbal cues?
–– Directive communication versus questioning
literature on leadership and –– Lack of trust in employees
other existing self-awareness 3. Confidence Building
–– Focus on personal over team achievement
tools, such as Myers-Briggs In the past week, what’s the one thing you did to
–– Desire to hoard knowledge to maintain power
Type Indicator. improve an employee’s confidence?
Reinforce Empowering Behaviors
4. Risk Taking Sample Behaviors:
■■ Facilitated peer discussion
When was the last time you publicly –– Sets clear zones of accountability
yields actionable insights.
acknowledged an employee for taking a risk –– Paints a compelling vision of the future
and failing? –– Invites feedback from employees at all levels of
the organization
5. Management Style
–– Encourages frequent reflection on why projects
During your last team meeting, what percentage succeed or fail
of the time did you speak versus your employees?
Assess Leaders’ Locus of Control
Understand willingness to change by asking:
–– Which company pressures most influence your
habits?
–– How responsible do you feel for
Leaders reflect on their experiences empowerment? How is your role different from
to uncover their leadership habits. that of employees?
Employee Feedback
■■ Share employee voice from survey data, focus
CIO EXECUTIVE BOARD groups, and pulse polls.
IT PRACTICE Source: Communications Executive Council research.
www.cio.executiveboard.com
RADICAL 1. AGILITY 2. PRACTICAL SUPPORT, 3. A DIFFERENT KIND 4. CROSS-FUNCTIONAL
© 2011 The Corporate Executive Board Company. CHANGE IN IT IS THE KEY NOT INSPIRATION OF LEADERSHIP OWNERSHIP
All Rights Reserved. CIO1169511PRO
17
There is no single owner
of organizational agility; FINDING 4: CROSS-FUNCTIONAL OWNERSHIP
a number of functions
must work together. Cross-Functional View of Roles for Driving Agility
THE AGILE
ORGANIZATION
TECHNOLOGY OPERATIONS
Develop cross-silo technology platforms Build flexibility into operating processes
that facilitate knowledge sharing and enabling decision making at the line level.
collaboration.
STRATEGY
Build flexibility and ongoing course
correction into company strategy.
18
KEY FINDINGS
1. The Changes Facing the IT Organization Negatively Impact Employee Engagement—Organizational redesign has a negative impact
on engagement capital that takes more than two years to wear off. Employees are experiencing change fatigue and are unable to
recover from a change before the next one kicks in.
2. In an Environment of Ongoing Change, Agility Is a Far Greater Driver of Performance Than Effort or Responsiveness—Agile
employees are better able to adapt to a changing environment as they are in control of their own response. They proactively adapt to
change, learn from others, seek feedback, and support their peers.
3. Arm Employees with the Information They Need to Solve Problems—To build agility, communication strategies for IT restructuring
must focus on sharing information that helps employees develop solutions on their own instead of only fostering buy-in.
4. Create Conditions in Which Productive Peer Learning Is More Likely to Occur—Agile employees are different from their non-agile
peers not only in having more peer connections but also in using those connections to actively learn.
5. Provide IT Staff with the Right Tools to Adapt and Learn—The role that the leadership team plays in driving agility is different to that
which simply drives buy-in, so prioritize coaching, connect employees to the right people, and seek employee feedback.
6. Agility Requires Collaboration Across and Beyond IT—Building agility is a cross-functional effort. HR must reshape hiring and
performance management models, communications must be positioned for problem solving, strategy should be flexible and
transparent, and technology must be used to foster collaboration.
19
The CIO Executive Board
can help you use the
OTHER IT ORGANIZATIONAL CHANGE RESOURCES
findings explored in this
research. Studies: The Future of Corporate IT
The Future of Corporate IT: How to Prepare for Five Radical Shifts in IT Value, Ownership, and Role
This study outlines the five shifts that will drive radical change in how IT organizations create value and in their
ownership, structure, and role.
The IT Talent Implications of the Future of Corporate IT: A Guide to Filling Emerging IT Skills Gaps
This study complements The Future of Corporate IT series and highlights how the changes facing IT have a
drastic impact on IT employee skills, objectives, and effectiveness.
Leading the User-Centric IT Organization: Delivering Business Value Through Improved End-User Performance
This study highlights low end-user adoption as the primary source of value leakage in system implementations
and provides best practices for enabling end-user productivity.
20
INFORMATION TECHNOLOGY PRACTICE
CIO EXECUTIVE BOARD