March 28, 2005 By Michael Armstrong
I came to Des Moines, Iowa, in the fall of 1997 to build a new IT Department and help change the organization.
I found an aging mainframe environment and an IT operation that lost respect from the rest of the organization. I also found an excellent charge-back application -- the most sophisticated application we had. It did exactly what it was supposed to do, did it very well -- and everyone hated it! In a charge-back system, IT usage is tracked and charged to departments according to the technology they use. Talking to stakeholders throughout the organization, I realized the charge-back application came to symbolize much that was wrong with the IT operation in Des Moines.
The first question asked of a department needing assistance was, "How are you going to pay for this?" This was coupled with assessing the entire development cost of a new report or application to the initial requestor, with subsequent users paying only incremental costs for the same application or report.
Des Moines also lacked other elements that would make a charge-back application useful -- a governance structure, a technology investment strategy and a clear explanation of how the system worked.
Not Fitting the Mold
The system was seen as both obstructive and unfair -- with predictable results.
The IT operation was ignored as individual departments built their own incompatible systems. Multiple manufacturers and platforms proliferated, and there was a definite "haves vs. have-nots" mentality in the organization. Individual departments submitted separate technology budget requests with little coordination, and IT involvement with server-based systems that departments were building was minimal.
There was great frustration within the organization about the inability to deploy modern technology, and a great hunger and willingness to move in a different direction.
There were other reasons to examine how IT was funded.
City Manager Eric Anderson was determined to change the culture of the organization and develop a view of the city as a single enterprise. He envisioned a collaborative and cooperative organization that would operate horizontally across departments, as well as vertically within the traditional government service structure.
He saw IT as a tool to promote that change. It was clear that a charge-back system, as it existed then, would be counterproductive to this goal. Individual budget battles for IT funding and the perpetuation of an uneven playing field would inhibit us rather than move us forward. We both wanted an IT model involving central coordination and funding, with strong emphasis on building an enterprise.
The organization was about to enter a period of rapid change -- both in IT and overall management. Part of that change was to move from a mainframe environment to a distributed server-based system. Our charge-back model would not fit this new environment. We also planned to reduce staff substantially, and re-creating and operating a charge-back system would be difficult.
Both Anderson and I believe radical change requires rapid movement. We didn't envision an evolutionary path for IT, but determined that the existing model should be "blown up" -- and blow it up we did.
Finally, as a new CIO, I was concerned about the position of IT within the organizational food chain. I thought building an organization dedicated to excellence required that IT be strategic, that technology become an essential part of the organizational infrastructure. IT must operate politically on equal footing with other back-office departments, such as finance and human resources. If these departments don't charge for their services, why should IT?
If IT were to assume a leadership role in the organization, and it absolutely should, it
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