Rebuilding IT Culture After Organization Change : Seven Steps IT Managers Should Take To Make Changes Work

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Q UI CK TAKE

Client Choice topic

EX ECU T IVE SU MMAR Y

When IT management changes the structure of its organization to align with an IT goal, it needs the

new organization to achieve smooth operations as soon as possible. The a?ected sta? have to settle into

new roles, new departments, and new processes. But longtime IT sta? may not adapt as quickly to the

new operating model or may resist changes in their work practices — resulting in ine?ective processes,

reduced productivity, and declining service levels. IT management should facilitate adoption of the new

operating model by taking specific steps to create the new organization culture.

RESEARCH CATALYST

Clients selected this topic for Client Choice research.

TEAMWORK AND COLLABORATION SUFFER AFTER ORGANIZATION CHANGES

IT organizations change their structure for a purpose. They may centralize operations to promote

process consistency, decentralize application development to increase business accountability, or

reorganize infrastructure areas to align with a service model. After a merger, acquisition, or outsourcing

agreement, a “new” IT must be formed.

When organizational changes occur, people within the

organization generally have varying responses — some will adjust quickly, others will take a “wait

and see” attitude, and still others may passively (or even actively) resist. This puts the goals of the

organizational change at risk. What is top of mind for the sta??

“Our old way was the right way.” Reorganization may have changed job definitions — for example,

by separating database support from server administration. But when individuals feel ownership of

their jobs, they may resist giving up old skills or adopting new responsibilities, creating a con?ict

between group responsibilities and the actions of the group’s members.

“Don’t step on my turf.” An organization that has relied on informal networks and collaboration to

get the work done may find that after an organizational change, sta? feel that they need to protect

their jobs. The result? Informal networks break down, e?ciency and collaboration evaporate, and

work quality erodes.

February 9, 2006

Rebuilding IT Culture After Organization Change

Seven Steps IT Managers Should Take To Make Changes Work

by Alex Cullen

with Laurie M. Orlov, Paul Roehrig, Ph.D., and Samuel Bright

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Rebuilding IT Culture After Organization Change

February 9, 2006

“That’s not my job.” When sta? become territorial as a result of changing job scope and

responsibility, they may retreat into an attitude of just doing their job and handing o?

accountability to someone else. Rather than taking ownership for completeness, quality, and

correctness of the results, they go by the book — and productivity su?ers.

RECRAFT ORGANIZATIONAL IDENTITY, MISSION, AND PROCESSES TO FACILITATE

CHANGE

When organizations change, individuals will be hypersensitive to what they have “lost” with the

change if they do not perceive any personal gain. Their jobs have changed, which changes how they

see themselves in their jobs. Facilitating their adjustment requires a broad-based plan of action:

Rebrand IT. IT sta? need to identify with their new organization and not with the old one that

they were formerly a part of. Give the new organization a new mission and a corresponding new

name.

Issue all the sta? with new business cards with their new titles and groups. Establish new

management practices — for example, by having regular “all hands” meetings if the previous

organizations did not have them.

Communicate the rationale for the change. If an organization has changed for a purpose, then

clearly communicate that purpose, as well as how the previous organization was not adequate to

address that need. For example, if an organization has centralized autonomous units to support

enterprise application revitalization, then let sta? know why this revitalization initiative requires

a centralization of skills — and explain what the business benefits will be.

Define success and measure progress. Clearly state what the critical success factors are for

the new organization, and then follow this with a program to measure success. Use a Balanced

Scorecard approach, for example — defining success across multiple dimensions and cascading

down into team and individual metrics.

Communicate results. Communicate the definition of success broadly and frequently, and

include both successes and shortfalls in these tailored communications, both inside and outside

IT. Nothing will align people faster than success at something, even if it’s not a big project or

initiative.

Tell sta? what’s expected — and what’s in it for them. Update the employee performance

appraisal process if it needs to change, and get this rolled out as soon as possible. Use the

updated employee performance appraisal as a means to reinforce the new IT organization

identity. Formalize new job descriptions and individual performance criteria.

Develop and implement new processes. When organizations change, there is a gap created

by the inappropriateness of the old processes or the old informal networks and the intention

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Rebuilding IT Culture After Organization Change

February 9, 2006

for how the new organization will work. Recognize this gap, and engage key in?uencers within

the sta? to define new operational processes. Use frameworks like the IT Infrastructure Library

(ITIL) model, educating sta? associates on the concepts and getting them involved through

“process teams.”

Ask for a commitment. At the appropriate time, ask people to make a decision to commit. For

example: “This is what we expect from who is here. If it’s not you, then . . .” Recognize that not

everyone will want to stay, and be prepared, through cross-training or team structuring, to

adapt to attrition.

R E C O M M E N D A T I O N S

CULTURE CHANGE REQUIRES PERSEVERANCE AND CONSISTENCY

IT organizational changes are made to achieve a goal, such as improving process e?ciency, or

to adapt to other decisions, such as an outsourcing decision. These changes always require the

remaining IT sta? to change their practices while maintaining or creating a high-performance

culture. But culture does not adapt smoothly in the absence of leadership or when intentions

and expectations are unclear or changing. Seasoned IT executives know the connection between

organizational e?ectiveness and organizational culture. To facilitate the rebuilding of culture after

the disruption of a reorganization, they:

Plan for an extended e?ort. Sta?ers who may be holding back from committing to the new

organization are looking for signs of commitment by management. A reorganization is not

complete after the sta? meeting and email announcement — follow-through to ensure that

the expected changes are occurring is essential to showing commitment.

Communicate consistent messages. Executives must put e?ort into thinking through

how they communicate to a?ected sta? and then make sure that a consistent message is

delivered about the change rationale, benefits, and expectations of sta?.

Make culture stabilization a management objective. Change won’t stick unless middle

management sta? recognize their ownership of the issue for their departments — and

nothing makes this clearer than knowing that they are being evaluated on how smoothly

this happens.

Walk the walk. To change the culture in an organization, all executives — starting at the top

— must demonstrate any desired new behaviors like open communication and information

sharing, collaborative teamwork, and giving credit for successes to those who did the work.

ENDNOTES

After a merger or acquisition, the resulting IT organization will consist of the combined sta? and

departments of the di?erent firms involved. Achie ving smooth operations by the new organization is

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Rebuilding IT Culture After Organization Change

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critical to achieving the synergies that drove the merger or acquisition. Similarly, after outsourcing IT

functions and responsibilities, the remaining sta? must adapt to di?erent processes and job responsibilities.

See the January 9, 2006, Best Practices “Mastering M&A: The CIO’s Game Plan,” and see the November 2,

2005, Quick Take “Manage Organizational Change In IT Outsourcing Deals.”

IT management may seek to change department responsibilities and processes to address service quality

or e?ciency. Forrester has worked with clients who implemented or restructured their service desks to

improve service delivery but found that inertia and fear of change prevented the capture of potential cost

savings and business benefits. See the May 27, 2005, Best Practices “Organizational Inertia Torpedoes

Service Desk Restructuring Gains.”

Creating a brand is a component of the marketing of IT to its business constituents that also benefits the IT

organization’s own cohesion and culture, increasing the sta? ’s sense of purpose and pride. See the August

23, 2005, Best Practices “The Marketing Of IT.”

The Balanced Scorecard is a highly e?ective management strategy to align organization behavior with goals.

A best practice is to cascade the overall organization’s scorecard to the functional departments, then to

teams, and then to the individual sta? level, so that an individual’s performance evaluation is directly linked

to desired organizational behaviors and outcomes. See the August 19, 2004, Best Practices “Cascading The

IT Balanced Scorecard.”