Technology and Organizations

I’ve known Peter Weill, co-author of IT Savvy: What Top Executives Must Know to go from Pain to Gain, since our days on the faculty at the Melbourne Business School. I was a visitor during my summers, while Peter and his colleague Marianne Broadbent were full-timers and doing the top research focused on IT business value. Peter is now Chairman of the Center for Information Research at MIT. (I hope to follow up with Marianne soon!)

Of course the title of Weill & Ross’ new book, IT Savvy, jumped out at me given my colleagues’ and my work on Systems Savvy. I find IT Savvy to be a beautiful, more organizational-level, companion to Systems Savvy.

Systems Savvy: The human capability to grasp the possible functions of technology tools and organizational practices and how these might be meshed to best effect. People with SysSavvy understand that technologies and practices are intertwined and they know how to make design adjustments to both the technology and the practice to effectively weave them together. We see SysSavvy as distinct from expertise, but more on that when our data are in…. Systems Savvy is critical to the ability to practice TOP Management.

IT Savvy: “…a characteristic of firms and their managers reflected in the ability to use IT to consistently elevate firm performance. Like savoir faire, IT savvy looks effortless from the outside. But IT-savvy firms distinguish themselves from others by building and using a platform of digitized processes” (p. 23).

My reading of this is that IT Savvy firms have managers who themselves have Systems Savvy. While Systems Savvy can be used beyond strategic information technology — when focused on the strategic issues described by Weill & Ross, the benefits to the organization are clear.

Weill and Ross note that IT Savvy is a rarity:

IT-savvy firms are not necessarily high-tech firms. In our research we have encountered only a small number of IT-savvy firms. Without exception, these firms use IT to “wire in” core transactions, and they use the data from their core transactions to inform decision making. Our list of IT-savvy firms includes highly successful new-age e-businesses such as Amazon, eBay, and Google. But long-established brick-and-mortar firms can also become IT savvy. Take, for example, 7-Eleven Japan, United Parcel Service, and Procter & Gamble (p.24).

Though rare, IT Savvy matters:

Our research found that firms that are above average on both IT savvy and IT spending have margins 20 percent higher than industry average. In contrast, firms with less than average spending and savvy have margins 32 percent lower than their industry (p.121)

What does it take to become IT Savvy? A business transformation that includes:

• Fixing what’s broken about IT – broken accountability and decision making
• Building a digitized platform – a base that provides stable core operations
• Exploiting the platform for profitable growth – leading change and driving value from this new asset

IT Savvy is full of clear examples (many based on their own research) and steps to take. Weill & Ross provide an assessment tool and the ability to compare your own firm with others. I found myself drawn in by their ability to answer questions I’ve had for a while. For example, In February 2008 I wrote a post about Southwest Airlines’, then new, boarding process. I was impressed with the success of Southwest’s complex implementation of the required technology, organization, and people components (showing TOP Management) and noted, “I’d also love to hear how Southwest came to manage the process in the way they did. Do they have this social and technical focus for all of their changes?” IT Savvy gives me the answer: Yes, they do!

The top thirty leaders of the company each sit on two or more strategy teams so they can inform their colleagues of services and needs within their own functional area while learning about the operations of other functional areas. The teams propose enterprise IT projects, which are reviewed by the firm’s executive committee in establishing project priorities. Around 80 percent of Southwest’s technology projects are aligned with one of the strategy teams. pp. 87-89.

I used McAfee’s Enterprise 2.0 book in my Organizational Design course this term. I think IT Savvy is the perfect next step (rubber meeting the road) for those students who continue on to my Managing Technology & Innovation course. My highest praise: IT Savvy was the first professional book to make it to my B&N Nook.

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The recent DARPA Network [Red Balloon] Challenge (prior post here) was a national illustration of the power of mobile communication for innovation. In approximately 8 hours and 52 minutes, the MIT Red Balloon Challenge Team was able to correctly identify the location of 10 special weather balloons located across the US.

Lance Whitney writes “Team MIT’s strategy was to build a Web site designed to attract more and more followers–people who might know the balloons’ locations themselves and those could bring aboard others who knew the coordinates, essentially creating a chain effect.”

Lance spoke with Riley Crane, the MIT group’s leader. Riley highlighted the power of the human network:

I think it’s important to point out that there’s a tremendous scientific opportunity in all of this, and from our side, we were never in it for the 10 balloons. Of course, that was the challenge, and that was exciting. But from a broader scientific perspective, we were in it to understand how to mobilize the vast resources of the human network, to face challenges and explore opportunities in living in such a connected society.

Breadth and availability from mobile connectedness can power a human innovation network. It doesn’t have to be about invention — the MIT team built a pretty basic website; they used social networking, starting with email; they used an interesting though not new “reverse pyramid” incentive system. None of the pieces were inventions (at least one team did invent – but they didn’t win). Instead, the MIT team practiced T-O-P Management by weaving together existing technology, organization, and people dimensions into a powerful approach.

We can all look for innovation opportunities based on existing mobile connectedness and the power of the human network. We don’t have to be inventors, but rather can focus on weaving together existing components for new value.

Two of my favorite books on innovation give ideas on how to do this weaving and why it works: Democratizing Innovation (Eric von Hippel) and How Breakthroughs Happen (Andrew Hargadon). Both von Hippel and Hargadon describe innovation as often not being about inventing something completely new, but rather putting together existing components in new ways (e.g., the Sony Walkman). They both also speak to the social aspects of innovation. From Hargadon (p. 57):

Within stories of [even] accidental innovation, however, we find two key mechanisms at work: moments when people, ideas, and objects from different worlds come in contact, and minds prepared to exploit these moments.

From von Hippel (p. 10):

Innovation by users tends to be widely distributed rather than concentrated among just a very few very innovative users. As a result, it is important for user-innovators to find ways to combine and leverage their efforts.

Mobile communication provides mechanisms for this combination and leverage.

• Mobility means we have instant access to the people in our innovation network where ever they are — You couldn’t predict where a DARPA balloon would be and needed the information quickly to be successful.
• Mobility means that ideas can be shared as they happen. Ideas are fleeting. Even constraining the contributions of brainstorming sessions by turn-taking can limit the innovation process.
• Mobility means we have access to information, ideas, open questions, and resources — whenever and wherever we may need them for our innovation process.
• Mobility keeps us engaged in the process. More and more innovation is a distributed effort and whatever tools we use (push email, Twitter, Facebook, or a purpose-built innovation tool) should at least partially be tuned to maintain engagement across the network.

But how do we manage the complexity that this mobile system of multiple idea threads, multiple communities, multiple technologies and platforms creates? Later this week I’ll go back to the ideas I mentioned from Ron Ashkenas’ A New Role for the CIO: Reducing Complexity. Dr. Lynne Cooper, Knowledge Strategist at JPL, commented regarding that post “So… the fundamental question is whose complexity is the CIO trying to reduce?” “I’d much rather have a toolbox full of great individual tools optimized for the jobs I have to perform rather than a Swiss Army Knife with 47 attachments that sorta do the job.”

For mobile innovation to work, can it be simple? Does complexity contribute benefits (as well as acknowledged costs) both through broader networks and better tools — but also from serendipitous discoveries from the complex overlap of networks, tools, and other triggers? If we do need this complexity, how do we manage it? Please comment here to add your ideas to the mix.

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Yesterday was the beginning and the end of the DARPA Network Challenge. MIT’s Red Balloon Challenge Team won in less than 9 hours. (Press Release pdf) DARPA tested the power of social networking and found it powerful. According to CNN, DARPA will be interviewing the participating teams to understand how they built their networks, motivated participation, and collected their information. Realize that false positives were an issue (certainly you can ask people what they see — but how do you know if you can believe them?)

From the DARPA site:

To mark the 40th anniversary of the Internet, DARPA has announced the DARPA Network Challenge, a competition that will explore the roles the Internet and social networking play in the timely communication, wide-area team-building, and urgent mobilization required to solve broad-scope, time-critical problems.

The challenge is to be the first to submit the locations of 10 moored, 8-foot, red, weather balloons at 10 fixed locations in the continental United States. The balloons will be in readily accessible locations and visible from nearby roads.

…and I missed seeing any of them (one was in San Francisco’s Union Square — so I had a shot).

The MIT strategy focused on the viral creation of a social network of support:

Sign Up, Invite Your Friends, Help Science, Win Money! We’re giving $2000 per balloon to the first person to send us the correct coordinates, but that’s not all — we’re also giving $1000 to the person who invited them. Then we’re giving $500 whoever invited the inviter, and $250 to whoever invited them, and so on…

They made sure the payoff model was clear:

It might play out like this. Alice joins the team, and we give her an invite link like http://balloon.media.mit.edu/alice. Alice then e-mails her link to Bob, who uses it to join the team as well. We make a http://balloon.media.mit.edu/bob link for Bob, who posts it to Facebook. His friend Carol sees it, signs up, then twitters about http://balloon.media.mit.edu/carol. Dave uses Carol’s link to join… then spots one of the DARPA balloons! Dave is the first person to report the balloon’s location to us, and the MIT Red Balloon Challenge Team is the first to find all 10. Once that happens, we send Dave $2000 for finding the balloon. Carol gets $1000 for inviting Dave, Bob gets $500 for inviting Carol, and Alice gets $250 for inviting Bob. The remaining $250 is donated to charity.

Brilliant.

• Motivation: For you, your friends, for charity
• Opportunity: The MIT Red Balloon homepage was built to easily accept the finds), DARPA made sure they weren’t hidden in invisible locations
• Ability: MIT gave clear hints about how to do this — invite your friends (why didn’t anyone invite me?!), use Twitter, Facebook

Yes, this was a social networking story — but you can also look deeper to understand the value in the MIT approach. They didn’t just rely on social networking, they practiced TOP Management. Technology: They built a solid website enabled to take in exactly the information they needed and then certainly had some technical processing to manage and evaluate that data. Organization: They created clear organizational practices – “This is how to organize your friends,” “this is how you get paid.” People: They used tried and true foundations around the management of human performance — Motivation, Opportunity, Ability.

Well done! Other insights into MIT’s process (or those of any of the other teams’) appreciated.

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Remember the user interface in Minority Report? Tom Cruise standing in front of a clear screen and, with super cool hand gestures, getting access to all the information he needs to solve a crime-to-be?

Mauricio Palomar, one of the students in my Technology & Innovation Management course forwarded MIT Professor Pattie Mae and Ph.D. Candidate Pranav Mistry’s TED presentation “Unveiling the ‘Sixth Sense,’ game-changing wearable tech.”

What would it be like to have a sixth sense — a sense of relevant information in a ubiquitous way? As Prof. Mae notes in the talk, yes, we can stop after meeting someone one and do a quick Google search on our cell phone, but that is likely to break the flow of the conversation….

How might work be different with this sixth sense? We certainly wouldn’t waste as much time on tracking down information.

Immersive performance with data coming to you as needed is not the same as being interrupted by data. Yes, more is being written about brain development and creativity being inhibited by constant “pinging” of social networking tools. Some claim we don’t have time for reflection if we are too attuned to the data stream. But I’m thinking of something else: “Data on the fly” (my term creation of the day) is more about staying in the flow of work than having work interrupted.

This is another step toward Immersive Performance. Comments especially appreciated on tools supporting immersive performance. What kind of tools are you using that proactively support your work process? This is more than Microsoft’s “Clippy” jumping in with “It looks like you’re writing a letter…” I would would get great value out of my library’s search system running in the background and knowing the kind of reference I’m looking for. Yes, I can stay more immersed now that I don’t have to take an hour break to go to the library and instead can look things up on-line, but it could be better. Retail sites can do it (e.g., Amazon with “Customers with Similar Searches Purchased”), so I’m guessing my library tools will eventually follow. I’m not asking for much, just context-aware search results without me stopping to think of the best search.

The MIT folks are close. What else could they add to their system to provide the greatest value?

And yes, I’m looking forward to fingernail polish in the four colors! (Watch the TED video — it’s well worth it.)

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