News Blog
Two people responsible for one and the same business process? Sounds like a source of conflict. But with digitalization in mind, the dual responsibility is actually essential – because functional managers and IT specialists should act as equals.
“Black Friday” was supposed to be a very big deal for this (brick-and-mortar) German retail company. The day after Thanksgiving – the beginning of the Christmas shopping season in the U.S. – was going to make the cash registers ring in this country as well, at least that was the expectation. The managers were already smiling with anticipation, convinced that their new online retail platform would work wonderfully that day.
Unfortunately, the underlying IT infrastructure couldn’t withstand the storm and collapsed while the shopping day was still young. Gone was the dream! Somehow, the online-retail specialists hadn’t properly coordinated with the digitalization experts in advance. And after the fact, nobody wanted to take responsibility for the fiasco.
It’s a classic situation. The managers manage, and the IT department, as a staff unit, is supposed to provide the necessary infrastructure. Of course, from the point of view of the managers, this is always done too slowly and not quite optimally. On the other hand, the IT department complains about the completely clueless requirements handed down from above, but as a mere service provider and supplier, IT isn’t responsible when something goes wrong either.
Process owners and IT as equals
At h&z, we think that IT management responsibility needs to be established. This is so that results, such as those of a digitalized supply chain, can be ensured by joint responsibility in the future. The management positions in a company’s core processes should be doubly occupied: one expert in the matter, and one IT specialist.
Many companies have long since realized that they lack IT expertise when trying to incorporate digitalization. It’s very contemporary to create the position of “Chief Digital Officer,” as high up as possible and filled by an expert straight from Apple or a similar company.
That is not wrong per se, but it isn’t enough. These “gurus” often lead their own lives up at the top. There’s a real danger that they may act in a way far removed from daily business – a foreign body among the long-established managers and without their acceptance. They also often lack experience with the actual corporate processes. The transformation fizzles out between the two areas of responsibility.
Developing business models jointly
On the other hand, the IT department cannot just continue along in its old role, humbly ensuring that the servers run and the software functions. The solutions are too diverse, the technological development is too short-lived, and the security risks are too high. That’s why the experts need to have greater authorization than in a mere staff function. Whoever knows how to use the digital tools that exist out there should also be involved in optimizing processes and further developing business models.
IT experts are being increasingly tasked with integration services. Their duties are becoming more diverse and significantly closer to the actual business. They are becoming designers, providers of ideas, and sparring partners for those engineers or business administrators who know the underlying process and the customer needs like the back of their hand.
They are thus part of a breakaway from of the rigid, one-dimensional organizational forms that have been so common, but which must now give way to agile network thinking. The transformation that the companies face demands not trench warfare, but simply quicker, more flexible, and strictly customer-oriented reactions.
Both partners, process authorities and IT experts, need to share their knowledge, struggle toward the best solution together, make decisions together, and win their laurels together. If this functions well, it can have a liberating effect: freedom from the old silo-thinking, the mutual finger-pointing and arguing, which we really can’t afford any more in the onrushing change process of digitalization.
Productive dual leadership
Customers aren’t interested in the internal power boundaries in the company. They want a pleasant shopping experience that flows seamlessly from order to delivery to payment and rating the service. The closer and more professional the relationship with the customer is, the more technology is required in the background. And the more sense it makes to have a dual leadership consisting of a process authority and an IT expert who grow to be “process owners” together. This will result in incredible boosts in productivity.
Dual leadership is not a new invention. Sometimes it works well and protects against incorrect decisions as a four-eyes principle. Sometimes it is complicated as well; there are conflicts and losses due to friction. But this can also be very useful, because the difficulties then come out into the open. And both members of the leadership are responsible for agreeing. They need to come up with tools for coordination, because their productive cooperation is urgently required. Under such prerequisites, one possible model is even to position a Chief Digital Officer next to the Chief Executive Officer (on equal footing) at the top of the company.
In this way, digitalization gains a focused entry into the company where it’s needed. The next “Black Friday” shouldn’t be a problem.
