It can be tempting to try to buy your way out of complexity by outsourcing as much of your IT as you can get away with or by adopting big-ticket platforms from any one of a hundred vendors that will swear they can solve all your problems.
"We went ERP in 2000. It simplified our landscape by getting rid of legacy systems. We cleared out the old and brought in the new," recalls Anthony Bosco, CIO of engineering and facilities management firm Day & Zimmermann. Bosco believes that having a fairly closed technology system or platform encourages simplicity because it discourages the addition of single-point technologies.
However, enterprises have multiple needs, which means they will need multiple systems. And when adding technologies is necessary, you get added complexity, Bosco concedes, especially where they duplicate some of each other's processes. "It worked for a while," he adds, but the complexity started creeping back as the business's new needs required new technologies not anticipated by the ERP developers. "The ERP systems of today are the legacy of tomorrow," Bosco sums up.
He's handling this conundrum by tying each platform to a specific set of business needs, such as ERP for financial management and e-commerce for online transactions. He enforces a disciplined set of links among them to prevent complexity caused by use of duplicate processes.
A seductively easy fix for complexity is to hand over your technology to someone else. That's a bad idea, says Bernard "Bud" Mathaisel, CIO of software outsourcing provider Achievo. When a company is stable, says Mathaisel, it's more efficient and costs less to manage well-designed key infrastructure, such as data centres, in-house. Outsourcing makes sense when a company is in transition, such as during a merger, or in a period of high growth, and you don't have the human or management resources available. "That's worth the premium cost," he says.
Outsourcing, unfortunately, may not reduce complexity so much as shift it, notes John Baschab, president of management services at consultancy Technisource: "Outsourcing turns a technical challenge into a management one."
And outsourcing per se won't fix overly complex subsystems. Sounding an ironic note, Ramesh Dorairaj, head of application management services at Mindtree Consulting, says that "offshoring merely arbitrages inefficiency at a lower cost."
Some organisations follow a cyclical approach to dealing with complexity. Every five years or so, they embark on a simplification effort to reset the technology base to something that can be used as a platform for future growth. In theory, this can work, especially for industries that have boom-and-bust cycles; the bust times are when you can make the investments for the next boom period.
But this approach has three flaws, says Daryl Plummer, chief of research for emerging trends and process management at Gartner. One is that enterprises rarely invest when times are tight. Two is that it requires a large shift in skills and priorities that's hard for people to handle. Three is that waiting lets the problem fester, leading to workarounds by impatient users that will contribute to complexity down the road.
"Occasionally, the window for big-project change does exist-maybe 5% of the time," says Mathaisel. "Take advantage of it when you can. But 95% of the time you're really talking about incremental change. You do what you can today and deal with the rest on a later cycle."
There's also bigger risk for large-scale retrofits embarked on during down times, warns Wal-Mart's Ford. It's precisely during the tough times that the business comes to IT for help. So counting on simplifying your technology environment then is probably not realistic.
The best approach is to make the work of simplification ongoing, says Dow's Murrell. "Look in every area to see what's redundant," he recommends. That doesn't necessarily mean doing anything to simplify the technology cans you've opened.
"You may make a decision to leave the worms in there due to the cost or the delay to value," Murrell says. But you should document what could have been simplified and why you didn't make the effort, so the next time that particular can is opened it'll be easier to determine if that's the right time to get rid of the worms.
Ultimately, says TD Banknorth's Petrey, you need to reduce complexity in the legacy technology you're not retiring. "If you don't," he says ominously, "the consequences to your business will come at a point not of your choosing.
"It's not a sexy thing to do," he continues, "and the business doesn't see the value in it, but if you let it go, you'll end up with complexity and fragility." Not a good combination.
Staging simplification efforts over time is a critical strategy for success, argues ING's Vincent: "Take bite-sized, digestible chunks; otherwise, you'll choke. Replace a brick at a time, not a whole building."
The highest complexity factor: Your job
It may seem as if the complexity burden has become too great to bear. But CIOs have been there before, says Accenture's Modruson, and not only have they survived, they've thrived: "In the 1980s, everyone stitched together networks from multiple technologies. Things have gotten better as technology complexities have collapsed."
For example, CIOs used to worry about what network technology to choose; now it's all IP-based and no longer something on which CIOs need to focus. Similarly, server technologies have collapsed into a few well-known quantities that CIOs can rely on. "These are standard platforms I don't have to worry about," says Special Olympics' Mendes. "I can target business value instead."
"A decade ago, we moved to new technologies quickly because the old ones weren't so good. But now we can be more measured because what is now the old stuff does work," Modruson says.
What's changed is that the complexity has migrated. As parts of the IT environment became standardised, such as networks, other issues replaced it, such as securing porous enterprise boundaries and managing massive data sets in a world where budgeting for downtime for maintenance and backup is simply not acceptable to the business. And emerging process-management approaches such as service-oriented architecture that promise to reduce the complexity of application integration and development introduce complexities elsewhere, such as in change management and testing, notes TD Banknorth's Petrey.
A more fundamental shift has been away from a focus on infrastructure technologies to technologies that deliver business processes. The IT infrastructure continues to pose its own complexity challenges, but it's now just table stakes-part of the CIO job-and why business needs CIOs who are both business- and process-oriented.
CIOs must play at several levels simultaneously, addressing both business and IT needs, keeping the systems running while ensuring that their technology strategy supports business operations, promotes innovation and provides competitive advantage in a changing environment, says Michael Farber, a vice president at consultancy Booz Allen Hamilton. "It's a 3-D chess board," he notes.
At most companies, "the CIO ends up at the tail end of things," stuck with complexities caused by others, says Dave Zink, client executive at consultancy EquaTerra and former CIO of CBS. "But when companies have elevated the CIO to the right level, they are less likely to have complexity."
Assuming they have a CIO who can play a mean game of 3-D chess.