People, Process, Technology doesn’t work if you don’t start with Culture

Changing how people think is the biggest challenge in transformation

Since the 1960s transformation has been about “People, Process and Technology”, but there is one massive element that gets just hidden under the “People” part that really should be called out separately:

Mindset matters

Peter Druker famously said:

“Culture eats strategy for breakfast”

And that cultural change gets put into “people” as part of the change management, unfortunately that means it regularly becomes seen as a ‘soft’ part of the transformation, that the ‘hard’ parts are

• Reorganizing the staff
• Implementing the new business processes
• Buying new technologies

In fact I’d argue those are the easiest. Everyone has seen cases where all three of these ‘hard’ pieces have happened but the benefits haven’t been delivered.

People, Process, Technology helps you focus on the wrong thing

Let’s be clear, I’m not saying that People, Process, Technology (PPT) is bad, just that people use it as short hand for Reorganization, Process and buy new Technology. By breaking each of these 3 areas down and viewing them as separate you really miss that it is actually that little bit in the middle that is the point.

I’ve seen variations of this picture around either as a Venn diagram or as three separate elements pointing into a central area. In other words the thinking goes that most of the work is within the circles and that is then coordinated to drive the change.

PPT encourages a cycle of change

This PPT approach, and its focus on reorganization, process and technology tends to produce noticable cycles of change, ones that don’t achieve the objectives, but do change things. Like shifting deckchairs on The Titanic. Lets take a common issue: The problem is a proliferation of reports, lots of complaints about reports, lots of shadow IT teams doing reports and lots of reporting technologies. Most of the time I’ve seen PPT applied and you get

1. Let’s have a reporting team in IT (People)
2. Let’s have a request process for new reports (Process)
3. Let’s buy a new reporting technology (Technology)

Then when there are still lots of reports, but now the business is complaining about responsiveness of the central team, is complaining that things take ages, and that is why they’ve had to reestablish their shadow IT teams you go through the process again:

1. Get rid of the central team, put the people into the business (People)
2. Go “lean” on process with requests direct from the business to those teams (Process)
3. Let the business groups buy new technologies (Technology)

And then a new CIO comes in, identifies opportunities to save cost due to a proliferation of reports, lots of complaints about reports, lots of shadow IT teams doing reports and lots of reporting technologies.

The challenge is thinking, the challenge is culture

The reality of the challenge in transformation is actually in the overlap of the transformation, the thinking part.

Thinking is what matters

That is where you should really be starting:

How do you want people to be thinking differently after this change?

This is what really matters. You need to think what that destination culture is, how will people be working and thinking. You need to work back from what you want the culture to be. To understand the new mental model you want to achieve.

So to take our reporting example, what is it we want to see in the future? If we accept the concept of the Data Inversion then what we might put out there as our future culture is:

Everyone requests improvements to decisions, not reports on current or past state

This triggers a very big first change, because if the future is about decisions, it means that the driver for data is that analytics and particularly decisions within applications will be the primary consideration for data what this immediately does is highlight that reporting requirements are the problem not the solution. The mentality, the thinking, the culture, needs to move towards how to improve business outcomes and decisions and only consider reporting as a last resort.

In other words our transformation program for reporting sets out with an ambition to eliminate reporting and change the culture to be about situational intelligence and business outcomes. That simple statement has a whole culture program that we need to start planning for.

From Thinking… move outwards

So after deciding on how we are changing the thinking, we need to start looking at how other elements need to change. Not leaping straight to PPT but looking at the next set of overlaps.

The next step of intercepts

So now we know that our key cultural challenge is the shift from reporting to decisions the next set of questions are what does this mean on the overlaps. For People & Technology, for People & Process and for Process & Technology.

These intercepts are the new culture that you wish to establish. From there on you can work on the details, but it is here that you are turning your desired way of thinking into a new business culture that will ensure its success.

Governance & Ownership

Starting with People and Process we need to look at Governance & Ownership. When looking at transformation this shift of accountability and how you will measure the transformation of accountability is absolutely critical. Before I worry about how I reorganize teams, I need to worry about how those teams will be effective, how they will be managed, where withing the business will they be managed from, and how will they be measured to ensure success.

Using our reporting example we want to understand how governance and ownership needs to impact the future. Given we are saying that the future is about data driving outcomes, we’re going to be thinking about business control of data and about how we are measuring that people are looking at outcomes over reports. We will look at how we define business outcomes, who in the business is accountable for the data, how we will measure its impact on the business.

So we go from our goal, and we look at our future governance and ownership model, and we do this well before we consider any reorganization or team construction. We are looking at what and who will own and control data.

Service Model

For People and Technology we are looking at the service model, how will people request outcomes in this new world? How will they be defined, priced, supported? Is this something that will be embedded into business units? Will it be delivered, or supported, by some sort of central team? Will requests to that team be made based on the outcome to be delivered, or just to get a number of people to do some work? What we want to understand here is how work will actually be delivered to achieve our goal. What contractual models will best achieve that end-state? What business health KPIs will indicate whether or not the service model is working effectively?

This is important, as it really sets up how you will measure the teams before you set up the teams. If for instance you decide that the right way to do something, for instance data ingestion, is via a factory and you want the service model to be priced based on some standard metrics (interface type, volumes, complexity, etc) then that will really change how you view the technology and people sides.

Automation & Operations

The final thing to look at before you get into the ‘traditional’ pieces is what you want to ensure is automated how how you intend to operate the technology. This works in conjunction with the service model so you can really understand what technologies really will fit the way of working that you want to establish. We’re looking here at the non-functional parts, the operations, the lifecycle costs, and the parts of that lifecycle that you really don’t want to be caring with.

It is this part that can lead you to deciding that a SaaS solution is going to be a much better fit than a custom application. Because you decide that upgrades, deployments and scaling are things that you really don’t see as important and want automated. You want availability to be managed at a three 9s level, and don’t want to be making the investments required to hit 4 or 5 9s.

This is where you think about how you want to operate, day-to-day, what is going to be the driving approach for processes, what are going to be the key decisions? By understanding that operational model and how it will be enable with technology you have a firm foundation to design that future process from.

Then do the traditional stuff

Now that you’ve decided on these intercepts it is time to work out the People, Process, Technology parts based on those intercepts. Everything is about enabling that future Culture, that future thinking.

Future Processes are based on the governance and ownership you want to ensure, they deliver the automation and operations .

The Future Organization, embodies the governance and ownership and delivers the service model that is required.

And finally the Future Technology, it enables the automation and operations that you want and is managed and delivered by the service model you wish to achieve.

By moving from the intersections outwards you deal with the real challenges of transformation, the details that represent your future world, and then do the ‘big’ things based on those intersections. It is still People, Process and Technology, but viewed as a true Venn diagram, and recognizing that it is the intercepts and not the circles that represent the most important challenges you will address.