WHU
02/03/2021

How IT Departments Need to Change Their Structure

Why competence in system security and infrastructure is no longer enough

Ayse Karaevli / Serden Özcan / Anja Wintermeyer - February 3, 2021

Tips for practitioners

Four previously underdeveloped competencies

Many companies are currently failing to give their ITstaff the opportunity to develop important new skills – both in terms of their jobdescription and their understanding of their roles. Research, at a globally operating telecommunications company based in Europe, has shown that four keyskills must be learned in order to structure a company’s IT systems to meet the company’s future requirements. Employees have to relearn their current tasks and develop into a new role.

1. Become familiar with the complexity of their own role

IT staff should be more closely integrated into their company’s value chain. This can be done, for example, by participating in decision-making processes that have a direct influence on the customer. The role of IT is becoming more complex because employees increasingly have to work with colleagues who have diverse areas of expertise.

For example, some companies already rely on assembling teams with a “T-shaped” knowledge structure. Each team member has deep specialist knowledge in his or her field of expertise, but also has a sufficiently broad additional understanding to be able to work productively with employees from the other specialist areas to make complex decisions together. The individual skills of the team members both complement and reinforce each other, expanding the shared knowledge of the team in depth and breadth. If the teams are entrusted with the development of a product or service from start to finish and receive direct feedback from customers, each employee’s understanding of the customer’s needs will grow. Surveys among the employees of the aforementioned telecommunications group showed that they were better able to get to grips with the increased complexity of their role if they could see how their contribution impacted the finaloutcome in practice. Executives should highlight how this new understanding of roles not only adds value to the company’s products or services, but also enables IT staff to acquire new skills that can benefit them in their future careers.

2. Closer networking and collaboration with faster integration of knowledge

The accelerating speed of digitaltransformation also means that the IT infrastructure needs to keep pace and become more open and flexible. Only in this way can opportunities be exploited that offer added value for the product and guarantee faster market maturity. Support by the IT team is essential when making use of new tools. In turn, IT staff need to network and exchange information more closely with a range of employees from other departments. Flat hierarchies should enable them to make decisions more autonomously and to integrate the knowledge they acquire into their working environment immediately and independently. The managers surveyed said that self-reliant teams with flat or zero hierarchies are able to access solutions more quickly and implement them in their working environment. Decisions are thus transferred from the executive floor to the appropriate experts in the specific departments. Research has shown that people who have full responsibility for development create better products, offer more creative solutions, and generally think concepts through more thoroughly. Directly entrusting IT professionals with strategic decisions also expresses respect and confidence in their abilities, which in turn gives them a greater sense of responsibility for the development process.

3. Being open to different requirements and trying new things

The digital age presents IT departments with increasing challenges and sometimes even confronts them with contrasting requirements that are difficult to reconcile. On the one hand, they have to fulfill their traditional role and provide infrastructure, service, and security to the company while simultaneously offering a broader range of services and reducing costs. On the other hand, they should also be able to initiate new business and make use of emerging technologies for their company. Their role is thus shifting from responding to requests to proactively supporting the business model.

To manage the potential contradictions of this new role, IT employees need to be open to both approaches. Instead of closing their minds to this dual role, they should view it as an opportunity to resolve tensions in situations where they arise between the roles. IT staff find it easier to navigate both worlds if their boss encourages them to take risks in the spirit of innovation and if they do not have to fear negative consequences in the event of failure. Test platforms also help employees gain the courage to try out ideas they have developed. 

4. Continuous learning and adaptation

The digital age is not only accelerating technological development, it is also affecting the business world. Being open and interested in continuous learning is therefore becoming a necessity. Managers should encourage their employees to extend their knowledge in important areas. IT professionals should take advantage of these opportunities and acquire new skills, learn from the experiences of others and be open to making mistakes. Research has shown that learning opportunities are more effective if they offer employees a certain amount of freedom at work, including proactive training, constructive feedback, and an open communication process. Conversely, goals and learning strategies unilaterally set by the management are perceived as being demotivating.

 

 

Tips for practitioners

  • Assemble teams in which employees have a “T-shaped” knowledge structure. Everyone should be an in-depth specialist in one field but should have also a certain understanding of what the other departments are doing. This enables teams to work in a complementary manner, strengthening their knowledge exchange, and facilitating decision-making.
  • Do not approach employees in your IT department as subordinates, but as peers and actively involve them in decisions. This shows respect and builds trust. Your specialists will feel a greater sense of responsibility for your company's product or service and offer more creative solutions of their own.
  • In the future, IT employees will have to fulfill a dual function: on the one hand, they will have to respond to traditional requests, and on the other they will have to proactively drive innovation forward. As a manager, your task is to remove their fear of making mistakes and promote innovative and risk-taking behavior – within reasonable limits!
  • Offer your employees further training but give them freedom in the design and goals. If employees don’t have a say in the learning goals, this can be demotivating.

Literature references and methodology

Several different interview and survey methods were used for this study. In the first step, 50 senior technology leaders, who participated in the 2019 European CIO Leadership Program, were interviewed. In the second step, three IT and HR leaders, working in a global telecommunications company based in Europe who are directly responsible for training IT employees, were interviewed. Finally, 309 IT professionals of the company answered a questionnaire which was analyzed together with the other results. The results were published by Prof. Dr. Ayse Karaevli, Prof. Dr. Serden Özcan, and doctoral student Anja Wintermeyer from WHU — Otto Beisheim School of Management in:

Co-Authors

Professor Dr. Ayse Karaevli

Professor Dr. Ayse Karaevli is a Professor and Chair of Corporate Management and Change at WHU – Otto Beisheim School of Management. Originally from Istanbul, Turkey, she holds a Doctor of Business Administration from Boston University and completed her post-doctoral studies at the Kellogg School of Management at Northwestern University. Professor Karaevli’s expertise is in the broad area of strategy with a focus on strategic and organizational change, CEO successions, top management teams, and executive careers.

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Professor Dr. Serden Özcan

Professor Özcan holds the Otto Beisheim Endowed Chair of Innovation and Corporate Transformation at WHU – Otto Beisheim School of Management. As an expert on startups, entrepreneurial finance, private equity, activist shareholders, corporate entrepreneurship, and corporate transformation, Professor Dr. Ozcan is the recipient of multiple international research awards and his work has been published in top academic journals. He is also the founding director of the annual WHU Campus for Corporate Transformation event, where C-suite members from Europe’s largest companies share their personal and professional observations on corporate transformation.

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Anja Wintermeyer

Anja Wintermeyer is a Senior Project Manager at Deutsche Telekom AG where she concentrates on inhouse strategy and management consulting. Anja is currently finishing her doctoral degree at the WHU – Otto Beisheim School of Management under the supervision of Professor Dr. Serden Özcan. Her research focuses on organizational agility and strategic decision making.

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