Don’t Avoid the Mandatory ThingsZoefeen Daitch
Undoubtedly, organizations around the world strive and aim for achieving excellence in order to get ahead of their competitors. But at the same time the most important factor of all calculations is the profitability. This means that the primary focus is on the finances and this often ends up in cutting down the costs which seems as an additional cost but its actual worth is realized when it prevents damages worth multiple times of the prevention cost.
I joined this large multi-national organization involved in multiple global scale businesses. I was a senior manager in their I.C.T department. From the outset, they have adopted the latest technologies and were also consistently making sizable investments in their infrastructure. Despite that, they were suffering frequent infrastructure issues of different nature. The organization has some highly paid and experienced resources who used to get involved whole-heartedly every time there was an issue and worked non-stop for days till resolution of the issue.
The problems seem to remain persistent in one shape or the other. The involvement of vendors also don’t seem to help the cause too much. The harder we tried to keep the frequency of the issue down, the more it seems to rise. The management tried different things and nothing seemed to work. All of the employees started to fear about their jobs and some even started exploring other opportunities. The management though has this mindset that firing old resources and replacing them with new resources will not help their cause.
In this whole turmoil, one of the Board Members recommended hiring an independent consultant to analyze and suggest corrective measures to put things back on track. He happened to recently attend an Introductory Seminar on Corporate Governance by OGMC and thus recommend them for this purpose. The organization did explore other possible consultants but OMGC seemed to suit their needs the most.
OGMC was subsequently hired to look into their processes and highlight some reasons along with recommendations for corrective actions. OGMC team completed their activities as per planned time. They reviewed our processes and interviewed some of the employees at different levels and roles. They shared their report and highlighted some very important facts causing the issues.
- The foremost reason highlighted was that though we were spending a lot of money in ICT to upgrade it to the latest version plus the correction cost for resolving the issues, we were not investing in the form of “prevention cost”.
- We had no compliance or monitoring team to proactively monitor the potential risks as well as overall monitoring of the system. Whatever monitoring was done was only through other teams as additional roles.
- We lacked specialized teams with clearly defined roles. Rather, there were limited resources and despite being made to work in multiple roles which was affecting productivity.
- Supporting resources were not hired to support the key resources. There was too much dependency on these key resources and there was no backup.
- Some senior managers and domain experts were made to operate outside their areas of specialty. Many technical resources were found to be performing management related jobs like compiling, negotiating and vendors related to contracts. Similarly, some pure management resources were being made to work on technical items such as monitoring the system performance or training to determine the technical root-cause issue on the system.
OGMC was further hired to help us set up the prevention mechanism as the management unanimously agreed to all the points shared by them. OGMC helped us to devise processes and set up internal monitoring systems and dashboards. They also trained the resources to enable them to use the tools and implement processes effectively. They also helped in defining specialized roles with clearly defined boundaries and helped in identifying and recruiting the missing support staff.
OGMC also remained engaged for the next one year to conduct audits on a quarterly basis. In each audit, they reviewed progress on adapting to the new systems and processes. They also recommend corrective actions for any gaps.
There was remarkable improvement in one year’s time as the issues/incidents dropped as much as 90% of what we used to face at the start of it. The financial analysis was also telling an interesting story. The amount, which the organization was thought to be saving by cutting on the investment to the prevention cost, was much less than what it cost them in corrective actions. The organization’s cost involved in setting up and running a new monitoring/compliance department, plus the cost of engaging OGMC for all their services, was less than 25% of the cost the company had to bear previously, in the same timeline, to correct the issues/incidents. Also it doesn’t include the wasted time and effort spent in corrective actions which otherwise would have been put to use in some other useful activities.
The simple message is that “YOU CANNOT AVOID SOME MANDATORY THINGS IF YOU ARE AIMING FOR SOMETHING BIG”