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The Pressures of Demand and Supply: Making IT Better, Faster, Cheaper

Published By Troy Dumoulin

The IT industry is going through a profound shift based on market pressures it has, in one sense, helped to create. The speed and cultural expectations that have evolved from an Internet/streaming economy have created a business culture and expectation which requires unprecedented levels of agility to remain viable — let alone profitable. This has created a downstream impact on internal and external IT providers, who must find ways to optimize the way they process requests and deliver services.

However, one might argue that the need to move faster has always been a constant pressure. While this is true, there are relatively recent, unique factors that have kicked this requirement into high gear over the past three years.

Localized Optimization in IT Value Streams

Lean and systems thinking teach us that any value stream is constrained by its bottlenecks. To even identify where these bottlenecks exist in a system, one must be able to visualize the IT value stream in order to identify areas of blockage.

The challenge with this is that traditionally, IT has not been optimized from a value stream orientation.  Instead, IT has been focused on localized and domain optimization, based on vertical, silo-based technology towers. While the lifecycle concept of Plan-Build-Run has been around for a dog’s age, and frameworks such as ITIL®, TOGAF, and COBIT® have provided systems thinking context and examples, the governance of IT has been fragmented by the technology domain.

This means very few IT leaders look at optimizing the flow of the enterprise value system, but instead look for ways to optimize Plan-Build-Run activities as distinctly different focus areas. Look closely and you will see that many organizations will have separate strategies for each technology tower without considering the full system’s performance.

An Unsustainable Model for Managing IT Complexity

This fragmented approach to governance increases complexity as organizations increase the variability (Mura) inherent in establishing different processes, suppliers, and technology strategies to address the issues of growing demand. This increased complexity and localized variability comes with the expected impact of creating more opportunity for waste, defects, rework, and error — all of which conspire to impact the organization’s ability to scale and accelerate.

To compensate, IT professionals have been kicking in the extra effort, capacity, and time to keep the flow moving by working evenings and even forgoing their weekends to deal with release or support issues.

This is not a recipe for long-term sustainability on many levels. Beyond the harmful impact on people’s personal lives, this type of unhealthy system drives burnout, from trying to do more than is possible. IT professionals, regardless of their skill and goodwill, are unable to create more time in the day to continue to compensate for fragmented systems. To use an old saying: “You can’t get more blood from a stone.”

Balancing Supply and Demand in IT

Two factors are influencing a company’s ability to realize customer objectives at a competitive speed: the increasing rate of demand and the stagnant rate of supply. Any reasonable consumer of a service will quickly begin to look at alternative suppliers if they realize that a company has an increasing backlog of work and long queue time before their request can be addressed. Simply put, tell me I have to wait several weeks/months for my urgent request to be handled, and I’ll need to look somewhere else for a solution.

We see this in the increasing use of directly purchased cloud services, contracted third-party IT services, and the funding of increased shadow IT functions. All of which, unfortunately, continue to add to the complexity and decreasing speed of the overall IT value system.

Lean for Better, Faster, Cheaper Value Delivery

To compensate for this growing pressure, IT organizations have finally begun to focus on optimizing their horizontal IT value stream as a complete system. They’re turning to the principles of Lean, which are focused on quality and flow. Lean principles have, in turn, spun up the practices of Agile software development and recently, DevOps. All of these concepts have one thing in common: speed.

As a speaker, consultant, and author, if you were to ask me what the topics of conversations around the IT water cooler were five years ago, I would have quoted you words such as availability, risk, compliance, reliance and maturity. However, the language of today has drastically shifted from those terms to focus on words such as agility, flexibility, performance and velocity. We’re seeing a complete pendulum swing from one side to the other based on the challenges I have outlined in this post.

We have to find a way to deliver on requirements for both speed and quality. “Better, faster, cheaper” implies that we continue to deliver quality — just with more efficiency. In order to achieve this, we must reverse the increasing complexity of our organizations by identifying, standardizing, and automating our IT value streams.

We need to understand how work flows from request to its fulfillment in order to identify bottlenecksremove waste (Muda), and manage WIP for optimal flow. To do this, we don’t have to reinvent the wheel; we just need to understand that in order to accelerate our businesses, we need to accelerate the IT management processes that have been well documented in frameworks such as ITIL® and COBIT®, and take advantage of the opportunity to standardize processes and services.

Final Thoughts

In short, the IT industry is finally waking up to the fact that localized (or siloed) optimization is not going to take us where we need to go, or allow us to deal with the speed imbalance of supply and demand. Leading with Lean principles means that we recognize that our IT value streams have to be optimized for flow. Practicing Lean or Agile means that we aim to improve them every day.

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Troy Dumoulin Written by Troy Dumoulin

Troy is a leading IT governance and service management authority with an extensive background in executive IT management consulting. He's a frequent speaker at IT Management events and is a published and contributing author on topics such as Lean IT and defining IT success through the service catalog. Connect with him on Twitter.