Introduction

I developed the IS Hierarchy of Needs while I was the CIO of The Warehouse. I developed the hierarchy because I had to. Let me explain. I became the CIO of The Warehouse full of joy and hope of the world because I believe in the power of technology to be a major catalyst of change and a source of competitive advantage and as CIO I was in the prime position to make this happen.

Issues Faced

After many years as a consultant, I was frustrated that I seldom got to see the fruits of my labour. Most IS enabled projects take time to deliver promised benefits, and I was rarely there to see final results achieved. I found that in many instances, decisions my clients made meant they were on the path to project failure, causing frustration as my hard work, along with my team's, would be wasted or blamed.

What I found shocked me. An IS organization in disarray, where all money went into keeping our systems working. In the first 60 days in my new role, our IS department had 62 “priority 1” issues impacting our ability to operate as a retailer. Most of our time was spent fixing these systems.

The IS Team's Emotions

The IS team hated that no one wanted to listen to them. They worked hard, sometimes all night, to bring systems back up but felt undervalued. I had a lot of empathy for my team, knowing they were capable and committed, yet I was on management's side.

The Need for Change

We were nowhere near competitive advantage, facing the realities of corporate IT. I had to figure out how to transition from operational difficulties to a position of delivering value and competitive advantage.

I began to research various sources, seeking a consistent map or guideline for moving from a dysfunctional, underperforming team to a high-performing IS department. High-performing companies often boasted high-performing IS departments that facilitated competitive advantage, demonstrating operational efficiency.

Key Decisions Made

  1. Focus on Systems Reliability: Our number one priority was to ensure our systems worked. I proposed using ITIL as a framework to improve our system reliability and performance.

    1. Initially, I aimed for 90% compliance with SLAs and 99.5% availability for critical services. We began to measure our performance and saw improvement, eventually exceeding these levels.

  2. Cost Effectiveness: To demonstrate commercial acumen, all IS business cases needed to impact IS costs positively. I aimed to reinvest operational savings into projects moving our systems forward. During this time, we reduced our operational costs significantly and increased project spending.

    1. It’s essential to have a solid understanding of your organization’s costs while showcasing your competence.

Achieving Private Victory

Once I achieved the private victory, my colleagues started recognizing the IS department's contributions. Conversations evolved from service levels and charges to the projects and long-term goals the IS team could support.

  1. Business Enablement: Using reliable and cost-effective systems to optimize the business model involved:
    • Improving operational efficiency through process automation.
    • Presenting data effectively for better decision-making.

Achieving this level might not provide competitive differentiation immediately, but it positions the IS team as a strategic partner in the organization’s future decisions.

Competitive Differentiation

With existing models optimized, we began exploring ways to innovate or introduce new business models significantly impacting competition. Real business model innovation is rare, especially for large, traditional companies, so it requires a serious focus on market changes.

Conclusion

The IS hierarchy of needs significantly influences my strategic viewpoint and guides day-to-day success. The hierarchy helps teams understand necessary actions in their business areas. Additionally, focusing on persistent needs is crucial in developing a high-performing IS department.