IT Fundamentals – Werner Roth

Making money is not a vision

When discussing vision or purpose, the comment that the honest answer to the idea of a vision is ‘making money’ is regularly heard from the sidelines. In fact, vision and purpose emphasise the focus on a long-term goal. But if, according to the hecklers, the most honest vision is ‘making money’, let’s take this for a moment as a working hypothesis for a hypothetical case company.

According to their vision, we focus on the financial decisions. Well, let’s put this ‘vision’ into practice. Let’s assume that two sales colleagues have two possible contracts on the hook. Contract number one brings us a large customer, a lot of business with little margin and the prospect of more deals in the coming years. Order number two is smaller, but with a spectacular high margin.

Our small sample company cannot fulfil both orders at the same time. We have to make a decision. Since a vision has a guiding power, let’s take a look at the objective ‘make money’. Lo and behold, our vision says neither ‘make money quickly’ nor ‘make money sustainably’.

Apart from a lack of understanding of the value of a vision, the rallying cry of ‘make money’ could be an allusion to moral issues. Perhaps also to the discrepancy between a global, earth improving vision and the quarterly staff meeting where 90% of the speaking time is spent on pipeline, turnover and other financial performance indicators.

Very few companies pursue a noble corporate goal altruistically. By their very nature, companies want to make money. What kind of business they want to do should be part of their vision. ‘Making money’ is a performance indicator and essential for survival, but it is not the objective and certainly not the vision. It must be possible to derive from the vision how I act, whether I choose the short-term lucrative or the long-term contract.

Years ago, I met a young man who spent his holidays earning money for a social project in which he had been volunteering for a number of years. The aim of this project was to support and mentor young people with social challenges through sport. To finance the project, he advertised gambling and alcohol. It was extremely important to him to raise as much money as possible. He said that if this advertising money ended up going to a good cause, then that was fine with him.

This is the most extreme example of the discrepancy between a social vision and the ways to raise money that I know of. The Vision is a shared dream, his dream was to fund sports equipment for this social project of his. As opposed to ‘making money’, that’s just the way to get there. You can argue morally about the way he did it.

Your AI application has no bias

Being a person with a technical background, I am annoyed by statements like the AI is racist, the AI is misogynistic, the AI favours old white men etc. because these attributions distract from the actual perpetrators, the humans.

Usually, the issue is that someone has used a generative AI and the result is simply not suitable. One nice example I found was an experiment by an HR colleague who used generative AI to generate a job advert. The result was a job description for a 50-year-old man with a lot of industrial experience. I found the result quite plausible, as this description seems to be about the average of how these positions are currently filled. So it was the wrong question or the wrong AI that was used.

AI applications are tools, highly complex tools whose decision-making principles are rarely traceable. Tools have no prejudices, people do. It would be like saying I don’t think my hammer likes my screws. If I use nails, everything is fine, but if I hammer screws into the wall, there are always such ugly chipped edges.

By the way, we completely redid the job advertisement without artificial intelligence. We let the current job holders get involved and asked them what they felt appealed to them. What makes their job and their employer special, what are the real benefits that competitors don’t offer. The response to this job advert was many times higher than before. And the position was filled quickly.

Bureaucracy and rules away, correct?

At the moment, people often say that bureaucracy needs to be reduced. That’s a good idea in general. However, in one interview I heard an entrepreneur throw away the baby with the bathwater. He demanded that many of the rules that he believed had been invented by politicians and the EU should be abolished in order to finally be able to work properly. These included important rules that, in my opinion, do not create bureaucracy, one after the other.

I actually think it’s important to have rules in the form of laws or internal policies. I don’t want hotels to store my data for as long as they like or for companies that are particularly careless with IT security to get off the hook if they lose my data in a ransomware attack. It is also damaging for the economy if we have no basis for security in these areas.

However, it is crucial that wherever regulations cause effort, this is minimised as much as possible. If in doubt, data collection should be avoided. Processes must be analysed for waste and what remains must be automated. Rules also need to be reviewed for their value every few years. Perhaps other rules have changed the situation. The same applies here: if in doubt, throw the rule away.

In companies, but also in public administration, I would like to see pragmatism; there must be an authority that can interpret and change a rule. I remember an occasion years ago when I was responsible for part of the IT operations. There was a major incident and we really needed all hands on deck.

Finally, an external technician came to the data centre for a repair and a member of the support team asked me who we should now detach and send to the data centre with the technician. According to the regulations, the trainee I suggested, who had been employed for 3 months, was not allowed to go with him. In my opinion, this was simply not foreseen and the wording in the regulations was unfortunate.

We briefed the trainee and let her take on this task. I informed the IT management in writing and a few weeks later we amended the policy. That’s what I mean by pragmatic. Understanding what was meant by the rule and courageously taking a diversion. Rules have a purpose, they have to be simple, practical and adapted.

Just ask how you can improve

Following the principles of lean management, we have discussed with many customers over the last few weeks. By asking them what they personally feel about the work we do. Their opinion of how we work as a presales team, not about the company’s performance as a whole or the level of customer satisfaction at the present time. And who could answer this question better than any line manager? Our customers!

Fortunately, we’ve had quite a bit of practice at this now. Doing this for the first time takes some arm-twisting and it feels daft on both sides. Customer surveys on products or services are familiar to us. Consultants asking to be criticised feels rather strange.

After some initial irritation, customers realise that we as a team are concerned with improving. This understanding is enhanced by a method based on Lean. Time again, all the conversations were great. There was compliments, but also some insights that are hurting, which is precisely why we are doing this.

This year, I have to say, I’ve been amazed at how rapidly our business is changing. We started an agile presales approach “Agile Business Accelerator” in 2018 with the expectation that about 25% of the market would demand iterative approaches. However, during the customer interviews, we discovered that all the customers we interviewed required an iterative, business-generating approach.

Customers presented this in their style and the culture of the companies rather differently. Oftentimes, they don’t even use the word “agile”. I consider this to be very valuable, business values are needed, and we find a suitable methodology together.

Thank you for your commitment and openness!

About transparency

Some years ago, I attended an inaugural lecture by a division head in which she analysed current figures from her reports, identified discrepancies and resumed. She concluded that these discrepancies indicated deliberate cover-ups. A circumstance that she will change. Because only a transparent system is able to provide people with the opportunity to act in a purposeful way.

I endorse the last sentence with all the knowledge and experience I have. Cheating, estimated figures or sloppiness combined with an 80s “management by objective” apparatus are the best possible nursery ground for mismanagement. At the very best, they cause frustration in individual areas, when everything fits according to the specifications, but the overall result is poor.

My own example above, by the way, did not end well; a new system was created that was consistent above all. This could be observed closely in the defects that were subsequently closed. I cannot say whether the original intransparent system was created intentionally. But I am very sure that the new system which was created aimed at concealment.

Now, there are certain areas where transparency is not permitted. Reasons for designated restrictions on transparency are, in my experience, Almost always fabricated. “We can’t give you the current figures, as you know one of our parts of the company is listed on the stock exchange.” When systems strive for transparency, it usually has a very different ring to it: “We want to better understand how our services are viewed by customers, so we compare x-and-y. The listed part of the group can only be included in the analysis in such-and-such way. But we are continuing to work on possibilities here as well.”

It’s about what you want to measure and what you can measure. People who understand Lean or Agile know that it’s a journey. Establish metrics which really move you forward, and in the best case these are lead-measures. Not forgetting to use the existing possibilities of “what you can measure” creatively and to create better chances.

In my experience, real good transparency is always a journey, not something you can finally achieve or even set by decree.