In the new digital world, time to value defines competitive advantage

A recent IBM study concluded that “no business can remain relevant by making tweaks. The only way to stay ahead of disruptive change is to embrace it, which means being able to develop and release new products and services within weeks or even days.”

One of the major implications of the unprecedented level of digital disruption is that companies must find ways to get a 10x compression in their product/application development release cycles. Simply put, how can they go from 6 to 12 months to 6 to 12 weeks to 6 to 12 days. Granted, not all releases have to get churned out in days, but those products and applications that are essential to delivering compelling and enduring customer experiences must find a way to meet this new compressed time standard.

Many companies have begun using different development processes and tools including Agile, Lean or DevOps to increase their time to value. While there have certainly been some improvements, there has also been continued resistance from long term developers who still prefer the more methodical waterfall approach. One would be tempted to “vote them off the island” only to discover that they are the only folks on the IT team who actually know how the systems of record work.

Using frustration as a motivator to change

Many CIOs I’ve talked with have complained at how frequently project priorities are changed in mid-stream leaving their developers angry and frustrated. One CIO who I work with has met this challenge head-on by limiting product development timelines to 90 days or less. He readily acknowledges that he will soon need to reduce it to 60 days and then to 30 days.

A core element of this new approach was to get everyone on his team and their internal end users comfortable with developing a minimum viable product (MVP) in that time frame and then make upgrades and changes based on end user feedback. He also has his developers go out on the shop floor and perform the work of their customers to see firsthand if the product or service is doing what it was designed to do, and, if not, what changes need to be made.

While he initially got some push back from his developers, they soon came to appreciate the fact that by taking this time compressed approach and making a fundamental commitment to rapid iteration, they could actually complete something they started rather than engaging in a series of false starts.

A 10x change requires new ways of imagining what’s possible

Most well-established companies have invested tens of millions of dollars in developing, installing and maintaining the systems of record necessary to operate their businesses. In many cases, these investments have served them well and enabled them to sail the competitive seas like the Queen Mary whose three to four-day trip from New York to Liverpool was the standard.

The new digital disruption from systems of engagement and systems of intelligence is not only turning the competitive landscape on its head but it is also forcing companies to reimagine how they engage with their customers, employees, supply chain partners, and other key constituents. Until the Hyperloop was recently conceived of, no one thought it would be possible to go from Los Angeles to San Francisco in 30 minutes.

The best 10x change example I’ve seen recently is the difference between NASA and SpaceX. When NASA launches a rocket into space, they have 450 people in their control room monitoring the flight. When SpaceX launches a rocket, they have 45 on their way to two – a pilot and co-pilot. NASA imagines itself as a space exploration company while SpaceX sees itself as a technology company in the space exploration business.

To compete in this new world of digital disruption, companies across all industries have to start to reimagine who they are, what they do and how they do it.

Organizing and prioritizing for maximum speed and throughput

Early adopters of the 4 Zones framework and tools as shown in the chart above have found it helpful to segment their new product and application releases in the following way:

• Are they sustaining innovations or disruptive innovations?
• Are they enabling systems productivity and cost optimization?
• Are they increasing business unit performance and revenue growth?
• Are they enabling business model transformation?

Each zone has its own time to value cadence and metrics but all of them require IT to be fast, adaptable and bring an enterprise wide perspective to the priority-setting process.

One way to move toward a 10x improvement in time to value is to strip away the multiple levels of decision making governance that bog down most IT project approval processes.

By example, one company I’ve talked with has a three level governance model that includes:

• IT Governance Board
• IT Steering Committee
• Six IT Operational Councils

Contrast that with another company I’m working with that has one Executive Product Prioritization Committee that meets once a quarter and agrees on:

• What IT will deliver in the next 90 days
• What are the 3 key strategic business priorities IT needs to support for the next 90 days

Moving at the speed of trust

Another way to get step change improvements in time to value is to breakdown hierarchical, silo-based decision-making processes and convert them into horizontal cross-enterprise decision-making processes. In order for CIOs to facilitate this shift, they need to establish or regain a high level of trust with their internal business partners that IT merits a seat at the business growth discussion table. Once this level of trust is in place, speed to market goes up and costs go down.

What does it take to make this new trust based process work? Here are some criteria to consider:

• An agreement that all the key stakeholders must participate from the beginning to the end of the development cycle
• A mutual desire to get something done quickly
• A willingness and desire to learn, grow and change while on the journey to the final outcome
  • Plan Long – Execute Short
• A common understanding of what needs to be done to deliver the ultimate user experience to customers, employees, supply chain partners or other key constituents
  • Replace inside-out user interface thinking with outside-in user experience thinking
• A mutually understood vocabulary and taxonomy to discuss and resolve, build, or buy trade-off decisions
• A series of metrics that align future technology investment priorities with critical business outcomes

Early practitioners of this process have significantly increased their time to value and have greatly reduced the costs of do-overs or extended release schedules driven by unclear or changing requirements. These results suggest that moving at the speed of trust is one way to achieve sustainable competitive advantage in the new digital world.

As always, I am interested in your comments, feedback and perspectives on the ideas put forth in this blog. Please e-mail them to me at pdmoore@woellc.com.