After IT Restructuring: What's Next? This paper was presented at the 1995 CAUSE annual conference. It is part of the proceedings of that conference, "Realizing the Potential of Information Resources: Information, Technology, and Services-- Proceedings of the 1995 CAUSE Annual Conference," pages 7-3-1 to 7-3-9. Permission to copy or disseminate all or part of this material is granted provided that the copies are not made or distributed for commercial advantage. To copy or disseminate otherwise, or to republish in any form, requires written permission from the author and CAUSE. For further information: CAUSE, 4840 Pearl East Circle, Suite 302E, Boulder, CO 80301; 303- 449-4430; e-mail info@cause.colorado.edu. AFTER IT RESTRUCTURING: WHAT'S NEXT? Susy S. Chan, Ph.D. Vice President for Information Technology Associate Professor in Information Systems DePaul University 243 S. Wabash, Chicago, IL 60604 Tel: 312.362.8597 Email: schan@wppost.depaul.edu I. INTRODUCTION In July 1993, DePaul University integrated its information technology and services functions under a new information technology division. This restructuring consolidated formerly fragmented services to achieve a unified direction for information technology aligned with university goals. In two years, the new division brought the university into a competitive technology environment of integrated network infrastructure and client server architecture. To respond to changing technology environment and maturing user community, in spring 1995, the division undertook a second restructuring effort. Four strategies were used to reposition the division: a) streamline functional areas for greater coordination; b) invigorate team leadership for shared responsibilities; c) initiate new cross-functional processes to enhance IT effectiveness; and d) implement a comprehensive communication and customer service program to forge active partnership with users. This paper examines DePaul's experience after its initial IT restructuring and discusses the rationales and strategies for further changes to meet changing university needs. Two cases, network and client server support, are presented to illustrate the strategies and implications. II. PHASE ONE: BUILDING TECHNOLOGY AND ORGANIZATION INFRASTRUCTURE My recent article on "Strategies for Restructuring IT Organizations" (Chan, 1995) provides a fairly detailed discussion of DePaul's first effort in restructuring its IT functions. In essence, five principles have guided the IT restructuring: * focus on institutional strategic goals * maintain IT organizational responsiveness; * provide integrated information and technology solutions; * develop an IT culture of learning organizations; and * insist on flexibility in resource management. The new division adopted a team-based, horizontal structure to achieve a unified vision, shared values, responsiveness to institutional change, and improved productivity. Seven small and flat functional groups were formed to replace formerly large, hierarchical, and separated departments. 1. Outcomes and Deliverables This restructuring yielded many positive outcomes: * networked 2500 users at five campuses * standards for platforms, productivity tools, * hardware, and network operating systems * standards for client server environment * a five-year telecommunications plan * a new telephone switch for the Lincoln Park Campus * consolidation of academic computing operating systems * student and faculty microcomputing centers * residence hall data & voice cabling * enterprise data model for new student systems * mainframe operating systems migration * data gateway for client servers * reengineered fund-raising process 2. Key Strategies Core Values for IT Organization Ten core values were introduced to unify formerly separated cultures and organizations. These values were incorporated into a new performance appraisal system as performance attributes: commitment to mission, continuous quality improvement, creativity and innovation, customer focus, leadership, openness to change, result-oriented, self-directed learning, self-empowerment, and teamwork and collaboration. These values helped to redirect staff's attention to the need for change, but have limited effect if not continuously translated into performance expectation. High Performance Management A new performance appraisal system helped to set performance objectives and review outcomes every six months. These objectives are linked to university and divisional strategies. This process motivated managers and staff to think and behave in measurable goals. Cross-Functional Teams We created cross-functional teams to support help desk, computing workshops, computing labs, and special projects. Team approach for ongoing support was less satisfactory than that for projects. Users were confused with the process approach. Clear objectives, outcome expectation, and division of labor are essential for team success. As a new organization, we underestimated the training requirement. Reskilling of IT Staff Multiple strategies were used to develop the soft and technical skills of IT staff across division. Leadership development programs, technical training on new technology for targeted individuals, participation in special projects, coupled with rigorous performance management, yielded high performance and productivity. Partnership with Clients Despite our effort in communication, the massive and numerous technology changes introduced in the past two years heightened users' anxiety as well as expectation. Communication and customer service did not meet changing needs. 3. Change and Transition We carried out the IT restructuring as planned but had to address transition issues along the way to ensure staff retention. The impact of restructuring on people, both individuals in the IT division and users, was sever. Many IT members went through prolonged anxiety about changing roles, responsibilities, relationship with co- workers and users. Users expressed equal frustration about learning new skills and fear for job shift. It became quite clear that we had to address the transition process for individuals in order to implement the planned change. Transition management differs from change management in many ways (Bridges, 1993). Change is an external process, often driven by events, situations, outcomes, and external environment. It emphasizes a new beginning and intended results. Transition, in contrast, is a process internal to specific individuals. It has three distinct phases--ending, neutral, and beginning--and starts with the ending. We assisted individuals through formal learning forums and informal communication to acknowledge their loss and the pain associated with the restructuring. We also emphasized a project approach to help those individuals to establish early success in moving into a new beginning. III. PHASE TWO: EXPANDED INFORMATION ACCESS AND SERVICES The rapid development of infrastructure achieved during the first eighteen months brought the university community to a new environment and heightened user expectation, 1. Rationale Changing Technology Environment The 1993 restructuring enabled the IT division to move the university from a lagging position to a competitive environment. Completion of the network infrastructure and new client server applications required the division to reposition itself as a service provider and a change agent, capable of improving work process through technology. Changing Institutional Needs The new technology environment afforded the university numerous opportunities to develop innovative strategies. Technology solutions became imbedded in academic and service strategies. The IT organization has to collaborate with user community and adopt a strategic view in selecting and prioritizing its projects in order to harvest the benefit of technology investment Changing User Expectation Our client base has tripled since 1993. Six to seven thousand students joined the user community in the 1995-96 academic year. Users of different proficiency level and needs further complicated the design of new service models. Measures of IT success shifted from infrastructure work to customer service, from technology solutions to our ability to vision and facilitate work redesign. 2. Strategies We continue to follow the five principles, mentioned above, to guide this second round of IT restructuring. A four-prong approach was taken to improve services and information access. Restructure and Streamline Functional Groups The seven small, flat functional groups accomplished the advantages of empowerment, cross training, reestablishing working relationship, and consolidation of technology platforms and operation. However, coordination across division was still problematic. To allow better coordination and more effective communication with users, functions for the seven groups were streamlined to form four functional groups while maintaining the same unified vision and culture. Information and Application Support (IAS): Focused on client server, work process redesign and migration of legacy systems Network and Telecommunications: Full responsibility for voice and network support, including network software support Academic Technology Development: All instructional and research computing, instructional technology, and student Internet support Management Support: Focused on customer service, management practice, user communication and IT policy research These changes gave each functional group a complete set of service responsibilities and accountability. Although an additional layer of managers was incorporated into each group, we balanced the organizational design by emphasizing team leadership and new horizontal processes. Strengthen Team Leadership This team, composed of the vice president and four directors, developed a heightened sense of shared responsibility through a commitment to priority projects, team problem solving, and management practice. This team was responsible for quality assurance and exercised a discipline in project planning, management, and customer service.. Develop New Cross-Functional IT Processes Four horizontal processes were established to improve user support. Objectives and expected outcome of each process are clarified for each process group. Software Research -- Expertise from ATD, IAS, and N&T was drawn to research, evaluate, and plan software selection, acquisition and installation before implementation. This process helps to achieve knowledge sharing and improved delivery of network software upgrades and support. User Computing Training -- Each functional group was responsible for conducting user training workshops on a designated network software package. This approach establishes direct, personal rapport with new users. It also instills a division-wide, shared commitment for user training. Help Desk--The process is coordinated by N&T but all groups provide higher level support. New policies and procedures were established to ensure a single point of service to the user community. Customer Service--A customer satisfaction action plan was supported by all groups. Measures and benchmarks were established for maintenance functions as well as new initiatives. Forge Proactive Partnership with Users A customer satisfaction action plan was developed to articulate products, services and clientele. This plan includes eight components: * university plan for information technology * IT policy development process * voice of the customer * project management and communication * customer satisfaction card * customer communications * operational performance measures * rewards and Incentives based on user satisfaction This approach enabled the division to design appropriate messages, communication strategies, and user support. Staff in the division received training in customer relations and communication. Besides various electronic and print communications, the division holds regular technology and project updates for users. Key user groups receive customized support. 3. Outcomes and Deliverables * new voice services for 1700 resident students * DePaul Online: Internet SLIP services for students * DePaul In-Touch--campus-wide information access * enhanced student bills * student and user training and services * suburban campus support * faculty microcomputing service * support for distance learning * remote Access for faculty and staff * enrollment management data warehouse * extend use of legacy systems * WWW applications * data policies and procedures * a new fund-raising and donor tracking system * redesign of student-centered processes and systems IV. Two Case Studies The IT division responded to changing institutional needs in two phases of restructuring. The initial restructuring in 1993 was to create an organizational infrastructure for implementing technology infrastructure. The realignment in 1995 was to reposition the division as a service provider and change agent. How did the IT restructuring affect users? What are the implications of these rapid, massive organizational and technological changes for the IT division? The impacts of these changes are examined in two cases from several perspectives. Case #1: Network and Telecommunications Support In the network support arena, the completion of university network infrastructure at all campuses by early 1996 will bring 3000 faculty and staff users into the Novell, Windows-based environment. Completion of networking for student residence halls would bring over 1,700 students in a "port per pillow" environment. The DePaul Online could potentially connect the remaining 15,000 students with the university. A shift from infrastructure work to provision of quality service--network operation, software support, help desk, and risk management--becomes a top priority. After the aggressive building effort, ways to ensure currency in technology and infrastructure become new challenges. New Environment Our client base nearly tripled since 1993 in an integrated network environment. We had to serve different generations of users; some are novice, some demand advanced technologies. Users now depend on the network to perform their tasks. They expect a stable work environment and a full range of free services. They view network standards and policies as signs of centralization in a traditionally entrepreneurial university environment. IT Internal Conditions The Network and Telecommunications group embraced the values of innovation and learning organization. They had little old technology to shed and quickly transitioned into the new work environment. They adopted a project management discipline and implemented networks at a fast pace. This in turn breeds staff expectation for new learning opportunities and career growth. Most of network staff valued projects over maintenance of network operations or user services. Realignment Strategies We realigned the network staff and service to meet user demand for reliable network performance and responsive services. The group was restructured into three sub groups--network operations, telecommunications service, and help desk. We moved technically oriented individuals into the network operations and staffed the help desk and telecommunications groups with people of strong service orientation and contact management skills. Several new members were recruited from other departments, such as placement service. The position of help desk manager was upgraded to confirm our commitment to service and the importance of a service-oriented career track within the division. We also created two cross- functional teams to support users at the two main campuses. Offices were reconfigured into an open space at the two locations to foster integration of voice and data services and personal contacts with users. Users are consulted to develop service standards and policies. Bonuses and performance appraisals were linked to user feedback. Results To Date While many of these strategies are still being implemented, user response has been extremely positive. Ratings for services during October and November 1995 showed more than 95% satisfaction. Timeliness in project completion received an a rating of 86% satisfaction due to poor coordination in October. Improvement was made immediately and raised the November results to 95% satisfaction. Current members appreciate the parallel track of service and technology orientation. The redesign of work space was essential in making the realignment successful. Case #2: Client Server versus Legacy Support In the client server arena, we are implementing an Oracle-Microsoft Access application to support reengineered fund-raising process. Object-oriented rapid prototyping and application development were used. We worked with consultants to rearchitect the enterprise data model for building an integrated student system. This two-year project, when completed, will replace home grown legacy systems. It is critical to develop new skills for application staff. How to target and motivate developers for these new learning opportunities while maintaining support for legacy systems is a delicate balancing act. In designing and deploying new client server solutions, we were also challenged by users' learning curves in using the technology. New Environment Our intensive effort in user training increased their knowledge about technology and information. Restructuring and reengineering in other university functions also raised their expectation for rapid technology solutions. Several user groups began to establish their IT support staff to cope with increasing dependency on technology. However, dependency on legacy systems continues as most of data still reside on the mainframe. Users showed mixed reactions to new client server applications; there was anxiety about steep learning curves and job shifts to be introduced in a client server environment. IT Internal Conditions Obsolete technology and gaps in skill profiles delayed our timetable to migrate off the legacy systems. Many individuals in this group attached their professional identify with the legacy systems and had trouble in transitioning into a new environment. There was also growing tension in resource allocation between on-going legacy support and new systems development. New systems demand skills and experiences that few possessed. Realignment Strategies The Information and Application Support group was realigned into four subgroups -- new systems, legacy support, systems administration, and production -- following the system life cycle. Any systems, regardless of technology or platform, would eventually move from new systems to the production phase. A complex system project would require support from members of several subgroups. We also developed a client server architecture (Unix, Oracle, Windows, Access), partnered with venders and consultants in systems development. To ensure project success, we also redesigned work space, created special project team rooms, emphasized user ownership in major projects. Results To Date Both users and IT staff experienced difficulty in transitioning into a client server environment. It would take much longer to achieve the desired change in this case. While these projects received much attention, it is important to maintain ongoing legacy support as the majority of mission-critical applications are still on the mainframe. Tension between the new systems group and legacy support had to be addressed promptly. Because progress in legacy support tends to receive less attention, special effort is required to encourage steady operations and responsiveness in problem solving. We sponsored many individuals for learning new tools. They did not always have opportunities to apply new skills immediately. It would be more effective to synchronize training with project assignment. V. IMPLICATIONS Reflecting upon DePaul's experience, it would be appropriate to view IT transformation as a process of managing at least three overlapping phases of change and transition. The first phase focuses on building organizational and technology infrastructure. The second phase emphasizes expanding information access and services for users. The third phase evolves around process innovation and integration, probably the most difficult to achieve. Each phase calls for different organizational design, skill sets, processes, and relationship with user community. What we have learned is that IT restructuring ignites a process of continuous change, because the institutional context and the IT internal processes and dynamics are changing constantly. The challenge we face is how to expand our capacity to manage change and transition. 1. Successful Strategies Five strategies have been critical to our ability to implement the transformation: A focus on outcomes and deliverables motivated the IT members to transition into a new environment and develop a sense of pride. Rigorous project management enhanced the success rate of on-time delivery. This discipline is adopted by all groups. Even routine maintenance tasks are now formulated as special projects to assure rigorous monitoring and timely completion. Flexible organization design, coupled with flexible staff and budget management, allowed the division to move nimbly in responding to university needs. A divisional perspective in resource management is necessary to avoid building new turf walls after initial restructuring. A discipline in performance management, linking individual's deliverables with divisional goals and project timelines is most critical in ensuring divisional performance. A reward structure that allows market adjustments and incentives for high performance prevented the attrition of some newly trained professionals. Adoption of a customer service attitude is a challenge for technical staff but our attempt so far has improved the division's image. Frequent feedback, direct communication, and personal contacts are keys to establishing relationship with customers. User feedback cards gave us quantitative evidence of problems, improvements, and user satisfaction. 2. Challenges The pressure that higher education institutions are facing in the coming years will require IT organizations to embrace continuous change. An understanding of what this continuous but radical change, or transformation, is critical for IT professionals. These changes have sever impact on people and must be carefully managed. Transition management is not well recognized in a change process. Acknowledgment of pains and difficulties associated with change helps individuals to move toward a new beginning. Creating a work environment that ensures small but early success from day one helps build confidence in individuals for sustained change. Those in leadership positions should take a special effort in working with individuals during the change process to build trust. Restructuring should be coupled with continuous quality improvement to achieve sustainable results. Radical changes need to be implemented quickly to capture the momentum and energy. It is difficult to anticipate all the consequences of change, even in a carefully constructed plan. Incremental adjustments afterwards are appropriate to ensure services, quality, and impact on users. Adopt a transformation process for continuous change will become a key to successful IT operation. Alternating between redesign, restructuring, and slower-paced quality improvement can build long-term results. However, the pressure on high education may soon propel IT organizations to quicken the pace for continuous change. Developing the organization's and its members' capacity for IT transformation will be a challenge few can avoid. REFERENCES William Bridges, Managing Transitions. Reading, MA, Addison-Wesley, 1993. Susy S. Chan, "Strategies for Restructuring I Organizations," CAUSE/EFFECT Magazine, fall 1995, pp. 13-19.