How Can You Make Your IT Department Strategic?

by drjim on February 16, 2009

Lockheed Martin's IT Department Had A Problem: They Had No Strategy

Lockheed Martin’s IT Department Had A Problem: They Had No Strategy

Isn’t that the goal of every IT department – to move from being viewed as a support organization to somehow becoming part of the company’s strategic core? Although we all know that this is what we want, for some reason it sure seems to be very hard to do. Good news – the folks over at Lockheed Martin have figured out how to do it…

Ed Meehan is the VP of operations at Lockheed Martin’s Enterprise Information Systems (EIS) and back in 2004 he discovered that he had a problem on his hands. In 1995, Lockheed and Martin Marietta had merged and Ed’s IT team had spent the next 10 years consolidating data centers (they actually got to be quite good at it). However, in 2004 they were done and they found themselves adrift – now what should they do?

EIS had neither a strategy nor a focus. Does any of this sound familiar to you? In order to have a strategy, you need to have a goal and since EIS is an internal IT organization they don’t have the normal measures of profit and loss. What’s an IT department to do?

What EIS had to do was identify a goal, create a strategy to reach that goal, and then sell the strategy to a spread out IT department that had never needed to have a strategy. How hard could that be?

Ed was smart enough to know that he needed to have his team pick the direction that they wanted to go in. He showed up at a meeting with three different popular business books that had three different business strategy goals: become a product leader, become the low-cost leader, or provide complete customer satisfaction. Pick one – you can’t do all three. Ed’s team picked providing complete customer satisfaction with the customer being Lockheed Martin’s internal employees.

So now what? Ed set up an 8-person team who had to map out the new strategy and then get the message out to the rest of the department. Their first step was to create a strategy map which showed how each part of the company would be measured against the goal of providing complete customer satisfaction.

Now the 8-person team couldn’t do this alone, so they asked each business unit to design their own strategy map with the thought that once they had this, EIS could then build a master map. You can imagine how well this went over – none of the business departments saw any value in adding strategy to their IT department and so they were, to say the least, reluctant to participate.

The 8-person team didn’t give up and they brought Ed in when needed. In the end, they got what they were looking for – a complete map of what it would take to fully satisfy the rest of the company.

Now came the hard part: selling the concept of thinking about the new strategy to the rest of the IT department. The biggest problem turned out to be the middle managers – they had “This To Shall Pass” syndrome. They figured that they could just wait things out and this “new idea” would go away just like all the other ones before it.

Well, they were wrong. It took a year to get the program off the ground and then it took another year to get the message out and train the staff. However, through relentless communication, they finally did it – everyone bought it.

Lockheed Martin has seen measurable improvements in their operations since this strategy was implemented. Internal customers have rated alignment between divisions as having improved by 160%. Probably the greatest payoff is that at Lockheed Martin, IT is now seen as being strategic.

Is your IT department considered to be a strategic part of your company? Does your IT department have a goal? Do you have a strategy to reach that goal? How are you doing in getting there? Leave me a comment and let me know what you are thinking.

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