Standardizing for Efficiency - The Question is "More Efficient for Whom?" Wed 25 Apr 07

Last week Mark Graban over at Lean Blog had a great post about standardization, "Out of Step: What's Important to Standardize?"  He focused not so much on the question of "what to standardize" but instead asked the even more important question of "why standardize".  He cautioned against standardizing for the sake of standardizing.  As Mark points out, you create standards because they add value and if people can see that value they are happy to comply with the standards.

We in IT love standards.  We have standard configurations for PCs, programming standards, service level standards and so on and so on.  At some level I think standards appeal to people in technical fields.  We are used to looking at things in a binary fashion.  It's either 1 or 0, on or off, black or white.  We standardize to lower costs, prevent problems and generally to make everything more efficient.

Being efficient is important in today's competitive world.  However, before you rush to standardize something for the sake of efficiency you need to ask yourself one question.

More efficient for whom?

It is easy to fall into the trap of standardizing something to be efficient.  Very often when we do this we are really saying "we are standardizing to make things more efficient for us".  But what about our customers?  After all we are in a service business.  It is more important to make our customers efficient than it is to make IT efficient.

Need some convincing?  Go take a look at your company's annual report and go to the segment reporting section.  Take a look at the revenues attributed to the major business segments and compare that to the amount of revenue they attribute to IT.  Wait a minute! There is no revenue attributed to IT.  Maybe it is because we've been only focusing on cost reduction.  So take a look at the earnings attributed to the major business segments and compare that to the earnings they attribute to IT.  Again, IT comes up with a big zero.  Companies grow and prosper by making and selling things or providing a service not by running IT efficiently.  IT's role is to make the business operations efficient since they are the ones that drive the revenues and earnings.

It is important to keep that balance in mind when setting standards.  If it makes IT more efficient but the business operations less efficient then we are probably not adding value.  Fortunately this doesn't mean we shouldn't try to make IT efficient.  There are ways to increase IT efficiency while not penalizing the business operations. For example, having only 1 standard PC model would be very efficient for IT.  However, in many cases this doesn't work for the business operations.  One size does not always fit all.  That doesn't however mean we let everyone get what they want for a PC.  By offering 2 or 3 standard configurations we can increase our efficiency while still meeting the needs of the business operations.  A true win-win situation.

Yes we should always strive to make IT efficient, just keep in mind that our real goal is to make the business operations efficient.  With some creative thinking and keeping the proper balance in mind you can often accomplish both goals.

What's your experience in dealing with situations where things appeared to be standardized for the sake of standardization?  What were you able to do about it?

"Binary Flow" photo by adrenalin

If this topic was of interest, you might also like these:

• Leadership Conversations
• How We Can Become More Like "Shadow IT"
• Let's Not Bring IT into this
• Or the posts in the "Customer Service" category

[Update 6/5/2007 - Fixed a bad link I had to the "Out of Step: What's Important to Standardize?" post]