Transforming the IT Department and Addressing Leadership Challenges
A case study of using the full range of tools and methods to achieve your goal
My client is a prominent figure in the drone and RC market across Czechia, Slovakia, and southern Poland. The company has established itself as a specialist in the wholesale of drone and RC models, drone parts, and exclusive distribution of selected high-class brands of drones, RC boats, and planes. Their business model encompasses retail sales via a network of hobby points and sales partners, backed by comprehensive technical warranty and post-warranty services. They also provide exclusive services for selected distributors, further solidifying their niche in the market.
I was entrusted with the management of the entire IT Department, holding the position of Director of IT and board advisor, wearing multiple hats for three years. This IT department was a combination of an internal IT team that took care of office equipment at the headquarters and in the sales network, which consisted of over 20 points at that time. The internal development and IT Infrastructure team took care of the website and server infrastructure for the ERP systems, and a workshop internal IT team consisting of technicians and engineers working around the clock to upkeep the critical workshop IT infrastructure.
The Challenge
In my first engagement with the client, I identified three major strategic hurdles that were impeding their progress and profitability.
Operational inefficiencies: These included poor efficiency and productivity, sub-optimal optimization of costs and resources, and a lack of cost control. These inefficiencies were increasing expenses and reducing productivity, thereby negatively impacting the company’s profitability.
Leadership and Management challenges: The company was grappling with poorly structured management, a lack of leadership and oversight, sub-optimal logistic management, non-existent security and risk management, and a lack of compliance and risk management.
Poor cash flow: The company was experiencing poor cash flow, which could be attributed to any combination of the above challenges. The inability to optimize operations, manage risks effectively, and generate value from investments was causing the company to struggle to remain competitive in the market, significantly affecting the bottom line.
Upon further analysis, I identified the following challenges in the IT Department:
Lack of clear goals and objectives: Without a clear understanding of what needed to be achieved, employees were not working towards a common goal, leading to poor efficiency and productivity.
Inadequate training and development: Employees were not properly trained and developed, resulting in a lack of necessary skills and knowledge to perform their roles effectively. This led to poor efficiency and productivity.
Poor communication and collaboration: The absence of well-established or functional communication and collaboration channels led to delays, errors, and duplication of effort, resulting in poor efficiency and productivity.
Insufficient investment in technology and infrastructure: The company’s lack of investment in necessary technology and infrastructure resulted in non-existent security and risk management, poor optimization of costs and resources, a complete lack of cost control, and a lack of improvement in compliance and risk management.
Lack of performance measurement and accountability: The absence of a clear system to measure employee performance and hold individuals and teams accountable for their results was stacking up on top of all other root causes. The company was unable to determine which activities were generating value and which were not.
HelpDesk and IT Service Department Overhaul
The first step in the solution was to overhaul the structure of the IT Department, which was previously divided into small teams locked in their procedural silos. This siloed structure led to minimal and poor communication among the teams, hindering the overall efficiency of the department. To address this, we adopted the principles of IT Service Management (ITSM) and Information Technology Infrastructure Library (ITIL), which emphasize a service-oriented, customer-centric approach to IT.
We combined and flattened the structure of the IT Department, breaking up the silos and fostering better communication and collaboration among the teams. The new, unified team comprised the internal IT team, semi-technical HelpDesk, web development, ERP development, SysAdmin, and technical HotLine teams.
To further optimize the process and reduce costs, we implemented the principles of Lean Management and Lean Manufacturing. These methodologies focus on minimizing waste and maximizing productivity, which aligned perfectly with our goal of process and cost optimization.
The new team was equipped with access to remote desktop software, enabling them to deal with basic troubleshooting of technical problems at our 20 (at the time) sales point locations around central Europe.
The team was structured into three lines of support. This setup allowed us to service queries from our sales partners and clients from all over the continent more effectively, faster, and with fewer errors.
As the company’s sales point network grew, we streamlined and outsourced the mobile technical service to locally vetted and trusted third-party partners in the form of remote hands as a service. This approach, known as nearshoring, allowed us to maintain high-quality service while reducing costs.
The administration and further development of the company websites, blogs, and forums, along with the associated SEO planning, were outsourced to my trusted technology partner, a digital agency from Ukraine that specialized in WordPress development. This is an example of offshoring, where we leveraged the expertise of an external agency to handle specific tasks, further optimizing costs.
Despite these changes, the ERP system remained under the control of the internal IT team. This decision was made to ensure that the system, which is integral to our operations, could be closely monitored and managed by our in-house team. This approach allowed us to maintain control over a critical aspect of our IT infrastructure while still benefiting from the efficiencies gained through restructuring and outsourcing other areas.
Working with the Team and Line Managers
The first step I took was to introduce the feedback loop and the STAR (Situation, Task, Action, Result) technique to the team and line managers. This method provides a structured way of giving constructive feedback by discussing the specific situation, task, action, and result of the situation being described.
Improving Employee Engagement: To improve employee engagement, I implemented the PDCA (Plan-Do-Check-Act) cycle and instilled the right Kaizen mindset in the team and managers. This approach involves employees at all levels, enhancing their productivity and performance. The introduction of the Kaizen flow can educate employees on how to eliminate waste, establish process consistency, and achieve cost savings.
General Management Process Improvement: For process improvement, we adopted a systematic approach and provided a combined toolkit to help employees enhance their problem-solving skills.
Establishing the Creed and Providing a Compelling Mission: I established the creed for the team and provided a compelling mission for the staff. The principles shifted and emphasized more flexibility and independence in the organizational structure, offering incentives for participation in process improvement, and eliminating punishment for reasonable risk-taking. This approach fostered a culture of innovation and continuous improvement within the organization for the years to follow.
Training and Onboarding Process Introduction: We developed and implemented training standards for new employees, streamlining the onboarding process. We prepared standardized processes and handy onboarding documentation that even older employees used to quickly check procedures. This not only facilitated a smooth transition for new employees but also served as a quick reference for existing employees. This comprehensive approach to addressing the challenges faced by the client led to significant improvements in their operations and profitability.
Establish a Robust Security and Risk Management Framework
This is a critical component of any organization as it helps protect the integrity, confidentiality, and availability of information. The framework began with the introduction of company security standards consisting of 10 easy-to-remember points, with no special asterisk attached, to give the team and managers the clearest message possible. This was an essential step in ensuring that all communication within the organization is secure and free from potential threats. It also helps in maintaining the confidentiality, integrity, and availability of information.
Ensuring compliance with relevant laws and regulations while operating an international business within three European Union countries, with multiple business associates from mainland China, Hong Kong, Taiwan, Ukraine, South Korea, Vietnam, and the UAE, even before the introduction of strict GDPR and AML regulations and trade wars between different socio-economic blocks, was not easy. I achieved this through the introduction of regular audits and training. Regular audits help in identifying any potential non-compliance issues and rectifying them promptly. Training is essential to ensure that all employees are aware of the laws and regulations and understand the importance of compliance.
Here are 10 easy-to-remember points I literally put on the wall:
Secure by Design: Always consider security when designing systems and processes.
Privacy First: Respect and protect personal data at all times.
Need to Know: Only access data that you need for your work.
Clear Desk, Clear Screen: Keep sensitive information out of sight when not in use.
Strong Passwords: Use complex and unique passwords and change them regularly.
Beware of Phishing: Be cautious of suspicious emails and links.
Regular Updates: Keep all systems and software up-to-date.
Backup Regularly: Ensure data is backed up and can be restored quickly.
Report Incidents: Report any security or privacy incidents immediately.
Continuous Learning: Stay informed about the latest security and privacy trends and threats.
Remember, these are not just rules, but habits that we need to incorporate into our daily routines to ensure the security and privacy of our data. Like pilots in the cockpit, clear and concise communication is key. Let’s fly safe!
Addressing Leadership and Management Challenges
As a business and management consultant, I collaborated with the company’s owners and the management team to conduct a series of workshops. The primary goal of these workshops was to establish a well-defined organizational structure, complete with clearly outlined roles and responsibilities.
These workshops not only allowed us to address and resolve past issues and conflicts effectively but also served as a platform for open communication and conflict resolution. Through in-depth discussions with the owners and the management board, I was able to identify the strengths and weaknesses of each manager.
One of the key outcomes of these workshops was the establishment of a shared understanding of the organization’s main goal. This shared vision was instrumental in fostering a sense of unity and purpose within the team. To further enhance the efficiency of the organization, I introduced the RACI matrix. This tool helped us delegate competencies and responsibilities effectively, ensuring that every team member had a clear understanding of their role within the organization.
Recognizing the importance of data-driven decision-making in today’s business landscape, I advocated for the integration of managerial economics and data analysis tools into the company’s decision-making processes. To this end, I recommended the hiring of a dedicated analyst.
Leveraging the company’s internal IT resources, I spearheaded the implementation of a data collection and processing system. This system, which was integrated into the company’s central database, served as the foundation for the subsequent development of a data lake. This, in turn, facilitated the migration to a new ERP system, further enhancing the company’s data management capabilities.
In conclusion, through a combination of strategic planning, conflict resolution, and the integration of data-driven decision-making tools, we were able to address the leadership and management challenges facing the company. This has set the stage for a more efficient, unified, and data-driven organization.
The Impact and Results: Navigating the Skies of Transformation
In the high-flying world of RC models, where precision and performance reign supreme, my journey with the regional leader in the drone market has been nothing short of an exhilarating adventure. As the Director of IT and board advisor, I took on the challenge of revamping the entire IT Department, steering the course toward operational efficiency and soaring profitability across Czechia, Slovakia, and southern Poland.
My journey began with identifying the strategic hurdles that clouded the skies of my client’s success – operational inefficiencies, leadership challenges, and a turbulent cash flow. It was clear that a radical shift was needed, akin to the precision maneuvers of an expert pilot. Here are my results:
Reduced Average Resolution Time: Like fine-tuning the controls of an RC plane or racing car, I streamlined our IT Service Department, slashing the average problem resolution time by half. The impact was felt across the network – quicker responses, satisfied clients, and a more agile operation.
Increased First-Call Resolution Rate: Our ITSM principles took flight, resulting in a higher first-call resolution rate. Picture it as nailing the perfect flight path on the first attempt – efficient, precise, and leaving customers with a sense of awe! The rate went from 1 in 10 to 4 in 10 in just over one and a half years.
Reduced Number of Customer Complaints: The overhaul led to fewer turbulence zones in customer satisfaction. With a leaner, more responsive structure, the number of complaints dwindled, showcasing smoother operations and happier clientele. The quantity of complaints decreased by over 90%.
Reduced Number of Security Incidents: In the world of business, precision is paramount. My security framework acted as the guiding compass, reducing security incidents and creating a protective shield around sensitive data. There were no leaks or major incidents under my watch!
Safeguarding Sensitive Data: Encryption became our standard. The percentage of sensitive data shielded by encryption witnessed an upward climb, securing our virtual cyberspace against potential threats. Communication and data at rest have become safe and compliant with applicable standards.
Sky-High Engagement: Through workshops and conflict resolution strategies, our engagement metrics soared. Imagine the team as a fleet of synchronized planes, each maneuver executed with precision, resulting in higher satisfaction and lower turnover. This was not only among the range but also among top brass, which was a problem when I was parachuted into the middle of the fire. After resolving many conflicts and explaining the quarrels between top managers and the owner, the situation calmed down after many hours of consultations with the management, which had a positive impact on the crew and line managers.
Enhanced Communication: Open channels became our air traffic control towers. The number of effective meetings and collaboration time increased, reducing misunderstandings and creating a clear flight path for success.
Productivity Skyrocketing: In the wake of improved leadership and communication, productivity took flight. Like a squadron of high-performance jets, tasks were completed with finesse, and work quality reached new altitudes.
As I reflect on this journey, the skies are clearer, and the horizon more promising. The impact and results are not just in metrics but in a transformed organization, ready to conquer new heights. The IT department is now a well-tuned model of a lean and agile organization, responsive, and soaring toward a future of innovation and success.
My Secret Leadership and Management Toolbox
I used quite a few tricks and tools to achieve and deliver results:
Mission Command Leadership Principles: This approach empowers team members to take initiative and make decisions within the leader’s intent. It fosters trust, encourages innovation, and promotes a sense of ownership among team members.
Lean Management and Lean Manufacturing Principles: These principles aim to maximize customer value while minimizing waste. By understanding customer value, focusing on key processes to deliver this value, and continuously improving these processes, organizations can achieve more effective operations and better results.
Plan-Do-Check-Act Cycle: The PDCA cycle is a four-step management method used for the control and continuous improvement of processes and products. It is iterative and facilitates the incorporation of learnings from past cycles into the planning phase of the next.
Conflict Resolution using Scientific Methods: This involves understanding the root cause of conflicts, acknowledging different perspectives, and using evidence-based strategies to resolve them. It draws on principles of human business psychology and neurology to navigate interpersonal dynamics.
Data-Driven Decision Making: This approach uses data to inform decisions, enhancing accuracy and objectivity. Modern tools for data collection, analytics, and visualization can provide valuable insights and guide strategic decision-making.
Near-Shoring and Off-Shoring: These strategies involve relocating certain business operations to another country to optimize costs, access talent, and improve service delivery. Near-shoring refers to moving operations to a nearby country, while off-shoring refers to relocation to a distant country.
Business Process Optimization and Business Process Automation: This involves analyzing current business processes, identifying areas for improvement, and implementing changes to make them more efficient. Automation can further streamline processes, reduce manual effort, and increase agility.
IT Service Management (ITSM): ITSM ensures that IT services are aligned with the needs of the business. It involves activities like planning, designing, delivering, operating, and controlling IT services.
Remember, the effectiveness of these tools depends on their appropriate and timely application. It’s not just about having the tools, but knowing when and how to use them!
Where Can You Use These?
It is my overarching recommendation that these principles can be applied universally, irrespective of company size, structure, or corporate culture. The tools themselves are just that – tools. To wield them effectively, a proficient leader and manager are essential.
Potential Challenges and Lessons Learned
If nothing else, here are five lessons you should learn from this case study:
Resistance to Change: Effective communication and involving key stakeholders in the decision-making process can mitigate resistance. Highlighting the benefits of change and addressing concerns promptly is crucial.
Balancing In-House Control with Outsourcing: While outsourcing certain functions can optimize costs, maintaining control over critical aspects, such as the ERP system, is essential for seamless operations.
Ensuring Long-Term Employee Engagement: Implementing continuous improvement processes, such as the PDCA cycle, and fostering a culture of innovation contribute to sustained employee engagement.
Global Compliance in a Changing Regulatory Landscape: Regular audits and ongoing training are essential to adapt to evolving regulations. Staying informed and proactive is key to ensuring compliance in a global business environment.
Integration of New Technologies: Thorough training and onboarding processes are critical for the successful integration of new technologies.
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