It’s clear that the digital revolution continues to affect every industry in profound ways. The rise of digital business models ranging from new social media platforms to creative car-sharing and payment services is happening at an amazing pace.
These market dynamics continue to put pressure on traditional structures and processes within organizations. The demand for productivity, speed, and innovation from customers has only intensified. Most organizations have undertaken transformations to become more digital: hiring new digital talent, modernizing IT platforms, and leveraging data more effectively.
But beyond having the right platforms and talent, the digital transformation requires a cultural change, a new way to operate, and broader digital thinking than the technology function. It requires a willingness to go fast, and to iterate and pivot when necessary to make progress. CIO and IT leaders are uniquely positioned to drive that culture change across the enterprise.
In April 2015, GE announced a decision to exit most of its $300 billion portfolio of financial services businesses and to refocus on its leading Industrial businesses in aviation, energy, health and other sectors. To rapidly effect these changes, while keeping the company safe and secure, required a global transformation of the company’s treasury operations. Practically every aspect of this initiative required intensive transformative work from the IT team. Objectives included both rationalizing financial services capabilities and enhancing capabilities for our industrial business with new digital tools and services.
To accomplish this, we adopted new ways to deliver IT services that have resulted in faster execution, better outcomes, and more satisfied customers. Not only did it help the company to transform successfully, it has become “the new normal” in the way we do our work.
“The digital transformation requires a cultural change, a new way to operate, and broader digital thinking that the technology function”
The cultural change that has driven our transformation consists of the following key elements:
1. Creating Multi- Disciplinary Teams
Regardless of how effective processes and communications are in an organization, traditional structures between IT and other functions create overhead that can slow down execution. Maintaining aligned priorities and focus across multiple internal organizations over time is challenging. By organizing into dedicated mission-based teams, consisting of the appropriate functional and IT resources, amazing results can be achieved in a short amount of time with better outcomes to customers.
In our treasury transformation, we assigned our strongest IT managers to lead the various simplification work streams. We created dedicated mission-based teams consisting of process experts, analysts, architects, and developers with a single objective to simplify our core processes and consolidate the sub-ledgers. Everyone understood the objective and their role in achieving it. The team worked together to solve issues quicker without delayed follow-ups. The approach worked so well it was hard to tell who was IT and who was functional. The results were fantastic. Seven sub-ledgers were retired in year one.
2. Empowering Employees to Get Things Done
When senior leaders and managers empower teams to execute, you can save a large amount time spent in making decisions, escalating issues, and reviewing status. Leaders should empower employees by setting clear expectations and guidelines on when to raise decisions and issues, and when it is not necessary. If you have the right talent, this action is liberating and brings the right drive and creativity required to make progress when challenges arise. One way we accomplished this was to minimize the number of meetings and material required for project updates. In a weekly transformation update, senior management met directly with the team leaders executing the work. We de-emphasized the use of PowerPoint presentations. Discussions are focused on progress, issues, and decisions. This saved a tremendous amount of time by eliminating prep sessions and reviews ahead of the senior management updates.
3. Setting Clear and Focused Objectives-Short- and Long-term
In a large transformation effort, it is important that each member of the team understands the overall objectives, and how their individual priorities link back to them. The nature of large transformation initiatives requires this to be revisited and communicated regularly. Often a long list of objectives or deliverables for a team needs context or reprioritization in the short term to ensure the right progress is maintained. We established quarterly and monthly objectives for the overall program and revisited them each month. Workstream leaders even set weekly objectives. This allowed a clear focus on making progress towards interim steps and adjusting when necessary.
4. Taking the Big Swings
Encouraging staff to take big swings requires setting stretch targets, understanding the risks and fostering an environment where it is ok to fail. This is not easy in a meritocracy-driven culture. The challenge is even greater given a massive, high-stakes challenge with implications for the entire company. Startups and entrepreneurs live by the mantra “to deliver big, you have to take big risks.” Fostering that environment for us involved setting the right tone at the top and the mechanisms to recognize the behavior. So, our weekly transformation updates always included questions on “what went wrong?” and “what did we learn?” and “how do we adjust?” It helped establish the fact that the aggressive deliverables and dates were understood and bumps or misses were expected. There was always a sense of how do we help resolve it or get on the right track.
5. Focusing on the Minimal Viable Product
As IT professionals, we all want to deliver solutions that are perfect on day one, and that provide as many functions and features for the customer as possible. But when speed is critical, trade-offs must be made. Taking a minimal viable product approach, we emphasized going live with the bare minimum required. In many cases, this allowed us to convert legacy systems and begin realizing the savings sooner. It also helped identified features that were no longer necessary or just “nice to have”. Our teams now realize the value of delivering a solution into production faster, and that not every aspect needs to be perfect.
Because of these cultural changes, our treasury transformation program delivered incredible results in its first year. Sub-ledgers were reduced by 40 percent through consolidation. Data infrastructure was reduced by 70 percent. Our entire data center consisting of more than 100 applications was moved to a single site and 44 percent of our servers were consolidated. All of this was achieved while delivering new digital tools to streamline bank, payment, and exposure administration and enhanced data analytics to improve company-wide cash and FX analytics for our Industrial businesses. When the entire team commits to transformation, both technological and cultural, it is possible not only to simplify but to take impact and value to the next level.
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