Goals ► Priorities ► Outcomes ► Initiatives

Do your organizational goals sound something like this: Foster talent by building a culture that maximizes opportunities for growth. Sounds nice, right? But how would you measure that? How would you know when you’ve achieved it? The truth is, it would be next to impossible. Whether you’re creating goals at an organizational level or at an operational level, here are some tips for improving them so that you can demonstrate their achievement.

Describe the outcome.
The trick is to describe the result you hope to achieve rather than the activity. Measuring an activity can result in meaningless metrics. (It is also wise to stay away from words and phrases that cannot be measured such as maximize or more efficient.) Here’s a possibility: Growth and innovation will increase through training, mentoring, and creating time buffers around scheduled projects.

Studies have shown that goal specificity and level of difficulty have a direct impact on employee performance: Goals that are specific and challenging (but not unreasonable) lead to better performance by motivating employees.

Create line of sight.

Just as important, a clear line of sight should exist between corporate objectives and the goals set at the operational level—employees should be able to grasp their roles’ importance in the larger picture. In order to achieve this, it is helpful to include different levels of the organization in developing the goals to ensure consensus, cooperation, and realistic goal-setting.

Define the measure.

Once your goals have been determined, you will be able to think about how you will measure the outcome.

• What are we trying to achieve?
• What behavior are we hoping to encourage? (Key Performance Indictors)
• What will success look like?

Performance measures should be as explicit as your goals, and answer the following:

• What change is being measured?
• How will the change be quantified (generally a number or percentage of something)
• What is the starting point or baseline measure?
• What is the target performance? By when?

It is an old saying but true: you cannot manage what you do not measure. Measuring tracks the specific activities and conditions necessary to support your goals and provides the means by which you communicate to the organization what is important. Measuring also presents the opportunity to identify problem areas and affords employees the ability to monitor their performance and see themselves comparatively. It is therefore vital that you measure the correct things—not the easy things because they exist or because you’ve measured them before—the right things. If your goals have been delineated with specificity and the outcomes you wish to achieve are clear, chances are you will know what they are.

First, using the 80/20 principle, think about which projects are critical, must-haves, and core to your mission (about 20% of the whole array), and set aside those that are discretionary or not vital. During this exercise, projects that should be eliminated altogether should be obvious. (Be ruthless.) Of the mission-critical projects, decide which should proceed and which should be deferred based on urgency and capacity. Considerations during your deliberations should include:

• The organization’s ability to undertake the project:
  • Do you have enough funding and staff?
  • Is there a learning curve?
  • What will on-boarding require?
• Data derived from the success or failure of other projects
• Timing and competition with other critical projects, especially for key SMEs and Management attention and cycles
• How projects may be interrelated and dependent on each other
• New technology and business process changes

Second, having decided which projects should proceed, it is time to collaborate with the entire range of managers, from line managers to senior managers, to prioritize them. Each will contribute something to the debate, and it is better to debate now than waste valuable resources (time, money, and people) later. Line managers will have first-hand knowledge of processes and capacity; middle management will have a better view of the interplay and inter-relationships between departments and activities, and top management will possess the long view that encompasses the overall organization direction and strategy. And obviously, inviting greater participation overall means greater cooperation and commitment.

Third, once your projects have been prioritized, it is time to figure out who will be doing what. Streamlining your projects down to the vital few has the added benefit of not stretching the capacity you have, but concentrating it where it is needed most. Here I would offer a special caution: it is very important that you are realistic about day-to-day operations and the support resources necessary to Keep The Lights On. Too often organizations under-estimate this aspect and/or think of KTLO resources as discretionary. They are not. Borrowing resources from KTLO operations results in “robbing Peter to pay Paul,” and effectively lowers service levels and stresses organizational capacity. Perhaps even more harmful, it underscores the notion that KTLO work is of less importance or less glamorous, damaging morale and trust.

Peter F. Drucker wrote, Management is doing things right; Leadership is doing the right things. Getting your portfolio into shape by winnowing out projects of questionable value and tabling those that can wait will go a long way to making the choice clear.

First, inventory ALL projects and activities that require any kind of IT resources, making sure to include non-obvious ones like SMEs and user training time. According to Gartner, 60% of IT’s budget is spent on operational, “keep the light on” activities, so it is important that these are included to ensure correct allocation of project resources. Projects that pull resources from core operations can create business risk.

Second, decide who will comprise a governance committee, i.e., who will make decisions concerning the portfolio. This should be a mix of IT and business leaders with the authority to make decisions for the organization. The governance committee will determine which projects should continue, which should be delayed, and which should be terminated. These decisions will be made based on determining which projects have the potential to create the most value for the company. Each project in the portfolio should align with business goals and be ranked on the strength of its business case outlining benefits, costs and risk. Keep this simple, but also be on the lookout for project interdependencies. You certainly don’t want a critical project bungled because it relied on deliverables from another project that was killed or delayed.

The importance of strong governance in the portfolio process cannot be overstated. Projects that are nice but not essential drain away resources that could be used more productively. Focus on cutting unnecessary demand and don’t start new projects until you know for certain that existing projects can be completed and meet expected deliverables. This won’t be easy. Every project is “owned” by someone who thinks it is the most important project in the portfolio, so it is essential to let the business case data drive the decision, and not emotions or politics. We can all relate. This time of year I can see myself riding around on a John Deere with 4-wheel steering, a zero turn radius, and a 48-inch mowing deck. Grass cutting would be so much easier (okay, and a little fun). But, with financial resources being what they are, I can’t make the case for its purchase because it will not really provide any material benefit. It’s just a “nice to have.” So, back to my 21” push mower. Sorry, John Deere dealer.

Half the year is gone. As you look at how you will finish out the year and also prepare for next year’s portfolio of projects, the summer months are a great time to review your project portfolio and get the pruning shears out. Since 80% of the benefit usually comes from 20% of the projects, in portfolio management, less is always more.

How many times has IT management staff felt that their business partners don’t appreciate or understand the effort, time and money required to satisfy a business demand? On the other hand, how many times do you think business partners wonder if IT is focusing on the correct enterprise initiatives, or why their requests are not satisfied to their expectation level? The answer? Too many times to count on both hands. Without transparency, the worst fears of both sides and all stakeholders become a reality.

Webster defines Transparency as “the quality that makes something obvious or easy to understand.” At TransAccel, we view Transparency as a prerequisite for making better supply and demand decisions that are based on cutting the right costs in the right way, while maintaining what is most valuable to the organization. With transparency, the IT organization can participate in valuable discussions that balance costs with IT benefits.

Transparency should exist across all sectors of IT – but especially crucial are:

• Portfolio management
• IT budgeting, performance management, chargebacks and cost allocations
• Measurement and benchmarking
• Investment planning
• IT service portfolios and catalogs

Poor Transparency exists when the value and tradeoffs associated with IT spending are not quantitatively discussed within the larger context of business strategy and goals. Typical results of this information disconnect are inaccurate budget forecasting, inefficient investment planning, and the wrong projects draining away resources, to name a few. Another consequence? Prior optimization goals are often repeated or even increased in following years.

Benefits of Transparency include better demand and supply management, budget forecasting, investment planning, increased governance, respect from business partners, identification of business-valued initiatives, and the elimination of non-core and non-differentiating resource-sapping projects.

The goal is to run IT like a business. TransAccel would be happy to assist your organization with aligning IT services and activities to business goals, and mapping those services to interdependencies and resource requirements.

As organizations strive to achieve leaner and more cost effective IT departments, Transparency is one of four basic cost optimization principles that will allow you to drop additional coins into your piggy bank.

In an effort to make planning less overwhelming, every month I am going to provide in this space a guide for the upcoming month. This guide will include a checklist and a set of questions that every IT leader should contemplate to be successful in 2012.

The first step to IT planning is aligning the IT calendar to the corporate calendar. If you are like most of our clients, the corporate financial calendar is based on the yearly calendar. This makes September the most critical time of the year in terms of planning for the following year’s success. Therefore, from a corporate calendar perspective (January through December), the first month in an annual planning calendar should be September.

September has begun, and, with the Labor Day holiday, we’re all probably behind schedule already. It’s time to get back to work—there is little time to be wasted. Here is where I recommend you begin:

September Theme: Alignment

To do:

Determine what 2011 projects are slipping
Ascertain what needs to happen to complete 2011 projects
Focus resources on completing those projects
Arrange for face-to-face meetings with divisional leadership. The objective is to hear and engage with each business unit regarding its objectives for 2012.
Immediately following these meetings, the IT business groups should meet and prepare a recommended plan for 2012 that includes objectives, strategies, programs, projects and estimated resource requirements.
To stimulate thinking and discussion:

What improvements / adjustments are needed to sustain your future business model and objectives?
Where are you with current operational improvement initiatives? How much more do you need to invest in these initiatives to achieve the desired outcome?
What events might affect the course of your transition?
How do you ensure alignment across all division, unit, and support functions?
What does this mean for your external partners and suppliers?
How can you utilize your extended ecosystem to its fullest?
I welcome your questions and feedback on this guide. We can all benefit from hearing about other’s issues and ideas. Happy planning!