IT Leading the Global Charge

Author: Kevan Hall

IT professionals are often first in line when companies start to integrate their international business operations or move work overseas – and this is not always a comfortable place to be!

As companies globalize they see huge benefits in integrating their global supply chain, finance or customer support systems. These systems are the bedrock of a successful company and give them a clear overview of complex operations spanning different cultures, timezones and business streams.

The cost savings are clear, but implementation can be a nightmare. Integrating these massive and complex systems has significant implications for how the company organizes itself – far beyond the confines of the IT function.

Integrated supply chain software changes the way companies think about their factories, planning and distribution processes. People start making trade-offs across geography, is it better to make this product in San Francisco or Shanghai? If the software is common should we support it from Buffalo or Bangalore?

As IT people wrestle with these problems in the implementation of the IT strategy they often find they are ahead of the debate in the rest of the business; local operations are not yet thinking globally and may be unwilling to adopt common solutions locally in order to advance the global good.

Often the mechanisms dont exist in the business to resolve this conflict without escalation to a very senior level.

For companies new to globalization there is a tendency to try to export systems from the home culture on the basis,if it works here it will work everywhere.

When they find that differences in currencies, telecommunications, languages, laws and practices get in the way, there is frustration and delay.

Some companies force through common solutions that damage their local operations. Others try to be so flexible to local differences that they never get anything done and fail to achieve their integration targets.

Be aware also that IT people may carry an inbuilt preference for top-down, common solutions, it makes their job much easier.

In our recent survey of 2,500 managers working for multinational companies 60 percent of IT respondents preferred a top-down management model, while only 30 percent of engineering respondents preferred the top-down model. Be careful that IT does not get too far ahead of the rest of the business.

There are also clear national cultural differences in this area the United States and many North European cultures tend to have a relative preference for common systems and processes while many other cultures, particularly Latin and Asia cultures in general, would prefer to get the same things done through networking and relationship building.

It can be hard to know whether resistance is due to genuine local or cultural differences or just a knee-jerk resistance to anything coming from HQ.

IT professionals have usually been successful early in their careers based on their technical skills, some have received management skills training, and fewer still have experience in running projects and teams outside their own culture or in working remotely with colleagues they rarely, if ever, see face-to-face. Suddenly they are at the forefront of a major global project that their company sees as the vanguard of their strategic globalization process. And of course it is always urgent, the cost savings have already been announced and project deadlines published - the pressure is on IT.

There is a natural tendency to prefer the "invented here" solution so global teams need to work even harder to demonstrate that their solution is more valuable or more convenient that the one developed locally.

On a practical daily basis IT professionals have to balance, sometimes conflicting, business objectives. Their loyalties to the global function and project are often clear in principle, objectives are set and milestones agreed, but that urgent local need emerges from the people in the next office, who they know so well and have worked with for years. The local customer is perched on their desk, looking them in the eye. They know that the strategic 5-year IT plan is important but what should they do? If they say no what will be the consequences for their local reputation, and their next career move?

Faced with these conflicting demands a lot of organizations have introduced a matrix organization structure where individuals have both local and regional or global reporting lines. The matrix provides a structure for resolving these difficulties but it does not solve it in itself – we still need the skills to manage conflicting priorities and demands on our time.

New skills are required to manage these trade-offs successfully, projects and other activities now operate across barriers of distance, cultures, timezones and where we need to communicate through technology rather than face to face. Though tens of millions of dollars are spent on (often tried and tested) software solutions, little is spent on training IT people to operate effectively in this new environment.

It is rarely the software that is the constraint on speed and effectiveness of projects, far more often it is delays in getting buy-in from local cultures, delivering projects successfully and overcoming barriers to cooperation.

This despite research that shows global projects with well managed kick-offs adapted for remote working can deliver 25% faster than projects without the same training and with lower travel and communication costs!

When companies outsource these critical IT projects and functions to other locations or even other organizations in other locations, the problems can be compounded. Now as well as managing distance, culture, timezones and technology we have to do this through a commercial relationship where some of the traditional management and teambuilding tools are not available to us and have to be managed at arms length.

Faced with increasing frustration from IT professionals in the centralized location over their lead-by-default role in global team management, and equal frustration from local IT people squeezed between the needs of the head office and the needs of the local operation, there are some clear steps companies can take to strengthen their IT global teams.

First - make intelligent choices about what to globalize, stick to the mission-critical systems that will really move the business forward and resist the temptation to globalize everything. The global expense claim system may have to wait!

Second - make sure that the senior power structure is visibly bought in to these priorities and communicate this clearly. Global and local project and team objectives must be aligned or people will be constantly fighting this conflict. Local operations are unlikely to adopt all proposals voluntarily, even if they make sense at the overall business level, and power may have to be used to resolve deadlocks.

Third - build involvement. Very often, remote IT employees see the global operation as ineffective and over-staffed; they believe that head office managers dont take their local needs into account until it is too late. Centralized managers see local IT people being too flexible to local priorities and disloyal to the global project - local complaints can seem petty and unrealistic from a distance. There are many fingers pointing at each other but one remedy is very clear: involve the appropriate IT and business stakeholders on critical planning and procedures from the beginning. Build global involvement and ownership from the beginning or it is likely that you will spend at least as much time later in the process dealing with the consequences.

Fourth - train your global teams and projects in the new skills of operating in this environment. Most teambuilding and project management training still assumes that you are a face-to-face team operating in a single culture – this is not a reality any more. The human dimensions of operating in distributed, virtual and international teams are challenging and require flexibility and adaptation of existing skills.

It is still common for strategy to focus on the software and project methodology, things that take a lot of time but tend to work. To be successful we need much more focus on buy-in, involvement and the human skills of delivering these integration projects - the things that usually cause delay and overspending.

Doing it the same way we always did is not working for many organizations. It is time to globalize not just the software but the skills of the IT community.

Last updated: 02/02/06 09:26am