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Implementing the 4 Zone Model Playbook

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From Strategy to Implementation: Common Drivers & Expected Outcomes

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Like any new strategic framework and set of tools and processes, the 4 Zone Model’s value can only be realized through implementation and execution. I have outlined below how some early adopters of the model have deployed different elements of the playbook to address critical issues and opportunities.

The 4 Zone Model is built upon several drivers common to enterprise information technology functions:

  • A need for innovative approaches to enable organizations to address five disruptive technologies: Cloud, Mobile, Social, Data Science and Internet of Things.
  • A need to evolve from lengthy waterfall-based technology implementations to the more rapid agile development approach. The Plan, Build, Run model will be displaced by a Co-Develop, Assemble, Consume model.
  • A need to embed a trapped value assessment process to identify opportunities to shift resources and funds from maintaining legacy systems of record to developing new systems of engagement.
  • A need to utilize new methodologies and tools to identify, develop and reinforce the relevant new skills and capabilities necessary to lead and manage a digital enterprise.

The motivation to adopt the Four Zone Model playbook encompasses a number of expected outcomes:

  • Higher percentage of IT resources allocated to change-the-business outcomes.
  • Significant increase in speed to market and throughput of all development initiatives.
  • Strong alignment between future IT investment priorities and critical business outcomes.
  • Increased ROI from the portfolio of IT innovation investments.
  • More impactful IT presence at the business strategy table.

To respond to these drivers and expected outcomes, the Four Zone Model playbook affords technology teams’ processes and tools which enable them to maximize the business value of IT across all three levels of their organization.

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The Starting Point: Mission-Based Teams

In order to move expeditiously, the 4 Zone Playbook begins at the “starting point” with mission-based teams specifically assembled and empowered to attack prioritized desired outcomes. These mission- based initiatives all start from the “Incubation Zone” and seek an exit path to one of the three other Zones depending on the desired outcome.

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IT Executives leading mission-based initiatives begin the process by asking three key questions:

  1. Should we do it? Does it align with and support critical business outcomes?
  2. Can we do it? Do we have the relevant skills/capabilities, tools and capacity to achieve the outcome?
  3. Did we do it? Do we have the right metrics to measure the achieved outcome vs. the desired outcome?

Mission-based teams are appointed for work which has been identified as a priority for movement from the Incubation quadrant to another Zone within the Model. Expectations for success can be high given the following critical elements:

  • Alignment at the leadership level that the work commands sufficient priority to be implemented. Alignment must occur not only within IT but also with all other key stakeholders including internal business partners and shared services partners.
  • Formation of the mission-based team includes careful appointment of team members to ensure they have the appropriate skills and competencies necessary to achieve the outcome.
  • The initiative must be carefully scoped to fit within the Model’s timeframe boundary conditions (namely pilot initiation to go live within 30-90 days especially for productivity and performance zone projects).
  • Active collaboration and critical thinking processes must drive the shared discovery, problem solving and solution adoption. The focus of the team and their work is deliberately narrow, user centric and intentionally innovative.
  • Measurement is expected to occur throughout the discovery and design process as well as at the conclusion of the team’s work.

The Outcome is Worth the Journey

What we have learned over the past 12 months is that to successfully introduce and deploy this playbook is a leadership challenge not a management challenge. This is not about just doing what IT has always done better, faster and cheaper. This is about transforming the role of IT from a cost center/support function to a business enabling strategic partner. This is about changing outcomes by changing legacy attitudes, behaviors and actions.

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

The 4 Zones Model: A Playbook for the Productivity Zone

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Reversing the IT Resource Allocation Imbalance Equation

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For decades, senior IT leaders have confronted the financial reality that every year 80% of their IT budgets are allocated to “running the business” while 20% are allocated to “changing the business.”

No one can argue how important it is for IT to make sure each company’s systems infrastructure and data is stable, secure and in compliance with industry standards and regulations. Unfortunately, just doing that job well severely limits the ability of CIOs and their senior leadership teams to maximize the business value of IT across their organizations.

The Trapped Value Audit

The new 4 Zones Model is designed to reverse that equation by creating individual playbooks for each zone and, in doing so, enable IT to exponentially increase its business value. The Productivity Zone Playbook is designed to optimize the costs of maintaining a company’s systems of record thereby freeing up resources to be redeployed against developing new systems of engagement.

A key tool to achieve this outcome is the Trapped Value Audit which enables cross-functional teams to systematically review all their systems of record and determine if they should be modernized, out-sourced or, if possible, eliminated. This audit is also designed the identify opportunities to significantly reduce or eliminate a company’s “technical debt.”

You can get started by asking some core questions:

  • Where is the trapped value in our company? E.g., maintaining systems of record
  • How can we identify and unlock that trapped value?
  • How can we redeploy that trapped value against critical new IT investment priorities? E.g., the development of new systems of engagement
  • Where is the new business value of IT going to come from?

The results of these efforts will enable senior IT leaders to redirect resources away from lower busine47ss value activities in the left hand column to higher value activities in the right hand column in the chart below.

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Extending IT’s Business Value Beyond A Company’s Infrastructure Model

Unlike previous evolutions of enterprise IT, which were mainly focused on the need for a company to adjust its infrastructure model, the disruptive impact of social, mobile, analytics and the cloud extend to its operating and business models. As such, it is imperative for IT to realign its skills, capabilities and resources to better enable the performance of the company’s operating model and if necessary help shift its business model.

From my early discussions with CIOs, this process entails earning the trust and confidence of their internal business users and partners as well as creating cross-functional teams to align future IT investment priorities with critical business growth goals and deliverables.

The chart below highlights these three levels of disruption and identifies specific sources of trapped value that these cross-functional teams can pursue together.

infograph2 By optimizing the costs of maintaining the infrastructure value delivery system, IT is then well positioned to deliver net new value creation for the company and thereby extend its business value across all three areas of potential disruption.

End Of Life Programs – It Takes A Village To Make Them Work

To be perfectly clear, companies cannot operate without stable, secure and well-maintained systems of record. These SORs run core functions from CRM to ERP to Finance. They also must be able to quickly and seamlessly connect with systems of engagement in order to deliver a friction-free user experience. That said, the fact remains that there is a significant amount of trapped value in how most companies deploy resources to maintain them.

In taking on the challenge of reducing or eliminating that trapped value, CIOs must establish a set of protocols and repeatable processes to monitor and evaluate the business value each SOR delivers. I have drawn upon some ideas and perspectives from my brother, Geoffrey, to give you some suggested ways to increase your odds of success:

  • Establish a stand-alone end of life (EOL) shared service function whose sole purpose is to manage this process from start to finish. Note: this is not just IT but all effected stakeholders.
  • Transfer all the SOR’s costs/expenses to the EOL shared services function.
  • Develop an EOL roadmap and timetable for each SOR.
  • Don’t allow non-EOL priorities/deliverables to compete for the shared services time and resources.
  • Accrue any trapped value savings to be redirected to new IT investment priorities.

A First Step

The Productivity Zone playbook is the first step in helping CIOs maximize the business value of IT across their organizations. It incorporates a set of tools to help senior IT leadership teams find the right balance between protecting the value they’ve created with stable, secure, compliant systems of record and creating new business value with easily accessible, friction-free systems of engagement that deliver compelling and enduring user experiences.

In my next blog, I will take a deeper dive into the Performance Zone and talk about the importance of IT building strong collaborative relationships with their internal business partners and other key stakeholders.

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.

THE 4 ZONES MODEL: A Playbook to Maximize the Business Value of IT

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Defining the Company’s Future Enterprise IT Agenda

The disruptive impact of social, mobile, analytics and the cloud is fundamentally changing the ways companies engage with their employees, customers, supply chain partners and other key stakeholders. In order for companies to remain competitively viable in the new world of digitally mediated interactions, they will need to overcome their legacy mindset about IT as primarily a cost center support function. CIOs must facilitate IT’s evolution to a full strategic partner role that directly contributes to delivering new revenues and profits. Simply put, a company will have to use technology as a source of competitive advantage in order to transform itself into a digital enterprise.

What’s ultimately at stake for CIOs is who will take the lead in defining and implementing the future enterprise IT agenda for their company. To regain their rightful leadership position requires both a new organizational and operating playbook for IT. We call this the Four Zones Playbook and it is designed to ensure that the organizational structure, operating cadence, resource allocation process and success metrics including ROI are properly adjusted to and aligned with the priorities and deliverables for each zone. In doing so, it will maximize the business value of IT across the enterprise.

The Four Zones: Maximizing the Business Value of IT


The 4 Zones

The Productivity Zone: Here the focus is to optimize the costs of maintaining the company’s legacy systems of record while making sure that all systems and platforms are stable, secure and in compliance with industry standards and regulations. There will be an ongoing effort to identify and unlock trapped value in maintaining legacy systems of record to be invested in new systems of engagement. There will be a goal of “no technical debt.”

The Performance Zone: Here the focus is to demonstrate the business value of IT as a source of competitive differentiation for all of the enterprise’s established lines of business. IT’s charter for this zone is to provide new user-centric tools, services and solutions eg: social, mobile, cloud and data analytics that improve the competitive performance of each of the company’s lines of business. The implementation of a Collaborative IT Governance Model will align future IT investment priorities with critical business outcomes.

The Incubation Zone: Here the focus is to help the company identify, test and validate next generation product, service and business ideas and leverage technology enabled innovation to develop them. An Agile development model will replace the traditional waterfall development model.

The Transformation Zone: Here the focus is to help the company scale net new lines of business that produce material (10% or more of current revenues) new revenues and profits. There can only be one transformational new business initiative in play at any one time.


The Key Principle for Success

Overall, the key principle behind the Four Zones model is that, because the goals and objectives of these quadrants are so diverse, any set of management methods that creates success in one zone is likely to cause failure in each of the other three. Therefore, it is critical to:

  • Install a governance model that separates these four zones from one another
  • Establish IT business value deliverables for each zone
  • Overlay a light-weight corporate system to oversee all four zones in parallel

In upcoming blogs, I will take a deeper dive into each zone and further examine the specific functions and deliverables from each one. I will also highlight specific implementation tools for each zone such as the Trapped Value Audit and the Collaborative IT Governance Model.

Based on some early engagements with CIOs and their senior leadership teams, I have seen first-hand the value and benefit this 4 Zone Model brings to maximizing the business value of IT within an organization and with its key external partners and stakeholders.

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