Cognizant 20-20 Insights
Top 10 Imperatives for Leading a
Successful IT Improvement Program
When companies understand the critical success factors for leading an IT
performance and process improvement program, they can advance their
business objectives and increase adoption across the corporation.
Executive Summary
Rapid technological advancement (e.g., cloud,
social media, mobile and analytics) and increased
globalization are having a profound impact on
the IT operating model.1 IT organizations are
struggling to improve their operating perfor-
mance in response to market demands for lower
costs, higher quality services, shorter response
times and higher return on investments.
Many IT organizations are applying quality
improvements pioneered and perfected in the
manufacturing sector to drive organizational per-
formance and process excellence. Although most
organizations clearly understand the benefits, it
has traditionally been a struggle to successfully
implement IT organizational performance and
process improvements, even for top-performing
companies.
This paper presents solutions and best
practices for mitigating challenges and success-
fully deploying such initiatives. Based on our
experience assisting Fortune 1000 clients with
large IT organizational performance and process
improvement programs, we believe there are 10
key implementation imperatives:
cognizant 20-20 insights | may 2012
1. Obtain senior leadership commitment to
initiating and managing IT organizational
performance and process improvement initia-
tives.
2. Perform an objective assessment, leverag-
ing standard models, for defining realistic
improvement goals.
3. Focus on identifying the right processes
and their process owners to achieve the
established goals.
4. Develop a roadmap that is well understood
and accepted by the identified process owners.
5. Institute a targeted marketing strategy that
creates enthusiasm and greater participation.
6. Establish a governance model that enables
effective management of the program.
7. Develop processes that are standard and fit
to use.
8. Facilitate organizational change
management to ensure smooth implementa-
tion of the recommended improvements.
9. Enable effective benefit tracking and
reporting to ensure sustained top-manage-
ment support.
Top 10 Imperatives for IT Improvement Programs

1
CIO/top management commitment (required across the program)

2 3 4 7 9 10
Process Roadmap Benefit
Goal setting identification Execution realization
creation

Continuous improvement
Program Management
5
Program marketing

6
Program governance

8
Program change management

Figure 1

10. Focus on continuous improvement of the
IT organizational performance and process
improvements.
The New IT Mandate
Several technology trends are building the case
for enhancing IT performance, including exter-
nalized service delivery, global market demand,
increased data volumes, social media explosion,
IT in business shared services and increased
complexity of the IT ecosystem (see Figure 2, next
page). Overcoming these challenges will help the
IT organization increase its agility and respon-
siveness to business requirements.
IT organizations are responding to these trends
by adopting effective IT operating models (see
Figure 3, page 4). The building blocks for any
IT operating model organization, process and
technology are undergoing a radical rethink to
ensure tight alignment to meet the demands of
the aforementioned trends.
To improve their IT operating model, companies
are increasingly adopting IT performance and
process improvement initiatives based on indus-
try-standard frameworks such as CMMI, ITIL,
COBIT, Lean, etc. to support and drive changes to
their IT organizational functions or technologies.
The next section describes how to effectively lay
out the vision of such initiatives, as well as effec-
tively manage the implementation journey for
achieving desired goals and outcomes.
Top 10 Imperatives for IT Improvement
1. Obtain senior leadership commitment to
initiating and managing IT organizational
performance and process improvement ini-
tiatives.
Key Challenges
IT organizational performance and process
improvements require sustained effort and
commitment across all levels of the organization.
The morale of employees and their involvement
in the improvement initiative is directly related to
CIO/top management commitment and clarity of
goals.
Key Recommendations
Based on our experience, IT organizational per-
formance and process improvements that have
been driven or sponsored by the highest levels in
the organization are more likely to succeed. We
advised one of our clients to include improvement
goals and objectives as part of the companys CIO
performance targets and cascade them down
to various departmental leaders. This strategy
resulted in increased commitment from all levels.

cognizant 20-20 insights 2

Drivers for Improving IT Organizational and Process Performance

Externalized service delivery: IT organizations are increasingly

leveraging cloud-based or software as a service (SaaS) delivery
models, resulting in significant IT operating model impacts.

Global market demand: Business from emerging markets

is growing significantly, mandating diverse IT models for
supporting business growth.

Increased data volumes: Emerging use of mobile devices is

driving a need for enhanced data management to support
the exponential growth in data volumes.

Social media explosion: Social media has enhanced customer

and employee interaction with the organization by providing
an easy-to-use medium.

IT in business shared services: Centrally provided applications

and infrastructure are being embedded in business services and
delivered by business shared services.

Increased complexity of the IT ecosystem: Significant

customization and proliferation of IT assets has increased
the complexity of the IT landscape.

Figure 2

2. Perform an objective assessment,
leveraging standard models, for defining
realistic improvement goals.
Key Challenges
It has been a challenge to establish appropriate
goals and objectives for an IT organizational per-
formance and process improvement initiative.
Various organizations have struggled to set
realistic goals based on change management
considerations.
Key Recommendations
IT organizational performance and process
improvements should focus on every aspect of
the IT value chain (as described in Figure 4, page
5) and set up realistic goals that reflect the orga-
nizational appetite for the change. There are
several industry-standard assessment models
(e.g., CMMI, ITIL, the Gartner IT maturity model,2
etc.) that could help chart out an improvement
roadmap.
The two forms of assessment methods seen in
the industry are formal third-party assessments
and self-assessments. The choice of a maturity
model and assessment methodology will depend
on the focus of the improvement initiative
(e.g., CMM/CMMI is more focused on software
processes, while ITIL is aimed at operations),
organizational relevance and cost considerations.
It typically takes 18 to 36 months to transition
from one level to the next. We helped one of our
large insurance clients define and manage a com-
prehensive two-year roadmap to transition from
Level 2 to Level 3 on Gartners IT maturity model
(see sidebar, page 8).
3. Focus on identifying the right processes
and their process owners to achieve the
established goals.
Key Challenges
Based on the maturity assessment, once the
organization is made aware of areas for improve-
ment, the next challenge is to identify process
areas with high impact and associate them with
the right process owners.
Key Recommendations
A software engineering process group (SEPG)3
or dedicated cross-functional team respon-
sible for driving the performance and process
improvement initiative should lead the exercise
of identifying process areas for improvement and
associating them with the right process owners.
This should be conducted via a series of program
definition workshops involving key stakeholders
from each of the IT functional areas.
Based on our experience of implementing such
programs, the appropriate process owner should
be someone who is involved with many aspects
of the process. When there are multiple entities
using a process equally, then it is best to assign
the process governance or ownership to a broader

cognizant 20-20 insights 3

Traditional IT Operating Model

Business Corporate Functions

Finance Risk and Compliance
Enterprise Learning Procurement
Business Unit 1 Business Unit 2 Business Unit N
Human Resource Sales/Marketing

IT Organization

Plan Build Control Operate

Business relationship Business and technical System testing organization IT infrastructure services
Organizations/

management organization analysis competence IT service delivery

Functions

QA support performance,
IT portfolio management Development organization regression, etc. IT service support

Strategic Vendor Services

organization IT audit and controls Application management
Vendor management office organization and support
Enterprise management

Business engagement Requirements management Test case creation Infrastructure standup

Process

Demand management Code development Load testing Service-level management IT Operating

Finance and budgeting Verification and validation UAT support Production support Model
Vendor relationship Code move IT audit Application maintenance
management

Application portfolio Application lifecycle Quality center Remedy

Technology

management tool management tools Performance testing tools Service Now

Project portfolio management Unit and integration tools Load testing tools
Database tools
Collaboration tools

External provider-enabled services (e.g., SaaS, integrated BPO, etc.)

Figure 3

process management entity (e.g., SEPG). The Change impact: Although the appetite for
process owner should be sufficiently senior in the change may vary across organizations, no
organization to drive the change. It is imperative more than two improvement initiatives should
to identify the right process owner with adequate be targeted at the same functional group
empowerment and interest in driving the change. within a quarter.
Project interdependencies: All project inter-
4. Develop a roadmap that is well understood
dependencies must be captured and factored
and accepted by the identified process
into the roadmap.
owners.
Key Challenges For one of our clients, we conducted a joint
While developing the program roadmap, IT orga- workshop with various process owners to clearly
nizations do not always consider the change establish impacts and interdependencies while
impact, as well as process interdependencies. developing the multi-year roadmap. The joint
workshop helped ensure faster consensus-build-
Key Recommendations ing on the roadmap.
Various process areas requiring improvement are
5. Institute a targeted marketing strategy
carved out as dedicated projects that form part
of the overall roadmap. Key considerations for that creates enthusiasm and greater
roadmap definition include: participation.

Process owner buy-in: It is critical to obtain Key Challenges

process owner buy-in, as these individuals are IT organization process and performance
ultimately accountable for making the process improvement programs invariably lose traction
implementation successful. over a period of time due to lack of top-down
commitment, ongoing business distraction and
Project size and complexity: This is an
lack of ownership. In addition, when impacted
important factor in creating the roadmap, as it
stakeholders are not appropriately engaged
helps companies gauge the effort required for
through the entire process, the results will be
each project and aggregate the processes into
sub-optimal.
waves for execution.

cognizant 20-20 insights 4

Key Recommendations
Organizations should focus on establishing an
effective marketing strategy that helps sustain
enthusiasm for IT organizational performance
and process improvement efforts. Key facets of
an effective marketing strategy are as follows:
Effective delivery of program- and project-level
messages.
Assurance that marketing is a continuous
endeavor throughout the lifecycle of the
program.
A cost-effective approach that leverages
existing organizational communication vehicles
as much as possible.
Our experience reveals that some of the most
effective marketing channels for IT organization-
al performance and process improvement include
roadshows, newsletters, company town halls and
program portals/internal Web site postings. One
of our large insurance clients used a combina-
tion of roadshows, newsletters and an annual
company town hall meeting to champion its
program. These mechanisms allowed our client to
establish a bi-directional communication medium
(i.e., communicate the improvement initiative
and also gather feedback on refinements to
the initiative) that resulted in greater employee
engagement and success.
6. Establish a governance model that enables
effective management of the program.
Key Challenges
The lack of well-thought-out program governance
impedes progress due to delays in decision-
making (e.g., funding, resourcing, change
management, etc.).
Key Recommendations
Effective governance depends on factors such as
the organizations culture and size, the diversity
of IT functions, improvement approach chosen,
etc. It is, therefore, best to include representa-
tion from all functional areas within the organi-
zation in the governance model (see Figure 5,
next page). Typically, three to four governance
elements are needed:
Executive leadership team: The team
responsible for sponsoring the program and
reviewing/ approving the roadmap, budgets
and progress.
Program steering committee: Typically made
up of a cross-functional set of senior team
members. This group regularly advises perfor-
mance and process improvement teams on the
changes desired, plans, progress and status.

Key Focus Areas for IT Performance and Process Improvements

1 Software Engineering Processes

2 Business Relationship Engagement

CMMI Maturity Model
Project monitoring and control
Project planning
Requirements management
Supplier agreement management
Measurement and analysis
Configuration management
Etc.
3 Architecture Management
ITIL
4 Project Portfolio Management
Service desk Incident
management
5 IT Workforce Management
Problem management
6 Application Portfolio Management Configuration management
Change management
7 Sourcing and Vendor Management
Release management
8 Application Operations and Support
Etc.

CMMI is a collection of capability 9 IT Financial Management ITIL is a group of methods that are
maturity models that are used as focused on managing and handling
10 Knowledge Management
an approach to improve business different aspects of information
processes within an organization. technology such as operations,
infrastructure and development.

COBIT COBIT provides a set of generally accepted

Planning and organization
Delivery and support
Monitoring and evaluation
Etc.
measures, indicators, processes and best
practices, to assist in maximizing the ben-
efits derived through the use of information
technology, and developing appropriate IT
governance and control in a company.

Figure 4

cognizant 20-20 insights 5

 Software engineering process group: Made
up of process experts and champions to drive
the improvement program.
Performance and process improvement
team: Formed as needed to execute perfor-
mance and process improvement activities (i.e.,
analysis or aid in implementation). This group
is often led by a member of the SEPG and made
up of consulting subject matter experts.
Program manager: Depending on the scale of
the IT organizational performance and process
improvement program, a dedicated program
manager is required to manage the program
from inception to closure.
Importantly, periodic governance reviews among
these three to four teams ensure that the initiative
is continuously steered in the right direction.
The following review checkpoints are usually rec-
ommended for successful program execution:
weekly status reporting, monthly steering
committee updates and monthly process owner
forums (i.e., fortnightly meetings to share lessons
learned across implementations).
7. Develop processes that are standard and
fit to use.
Key Challenges
CIOs and top managers most often treat IT orga-
nizational performance and process improve-
ments as internal projects that can be performed
by employees on a part-time basis. This approach
fails in most cases, as employees consider the
Governance Model for the IT Improvement Program
Executive
Leadership Team
Program
Manager
Process Owner 1 Process Owner 2
Figure 5
cognizant 20-20 insights
activity to be of lower priority and do not focus on
it adequately, leading to a prolonged turnaround.
Moreover, standard process definition shortcom-
ings often create difficulties in adoption across
the organization.
Key Recommendations
We recommend involving dedicated subject
matter experts for process definition. It is also
essential to standardize the organizations
processes, including process descriptions, process
maps, roles and responsibilities, and measures.
Process description: Clearly illustrates the
purpose of the process. The description may be
depicted graphically, textually or both.
Standard operating procedure: SOPs provide
a repeatable way of executing the process.
It includes process maps, roles and respon-
sibilities, templates, guidelines, standards,
checklists, etc.
Measures and metrics: This enables measure-
ment of the improvements and successes of
the initiative.
8. Facilitate organizational change manage-
ment to ensure smooth implementation of
the recommended improvements.
Key Challenges
In our experience, the biggest constraint to a
successful IT organizational performance and
process improvement program is resistance to
change.
Program Steering
Committee
Performance /
Process
Improvement
Team, Led by
SEPG
Process Owner 3 Process Owner N
6
Key Recommendations
Adoption model: There are several ways to
adopt effective IT organizational performance
and process improvements. Some of the best
ways to do so (but not exclusive of each other)
include:
>> Top-down adoption: This approach first
focuses on appropriate buy-in at the cor-
porate level (top management) and then
drives adoption down to the individual busi-
ness units.
>> Bottom-up adoption: This approach
assumes that change is defined for any
smaller sub-group through a project, or
a series of projects, and is then adopted
across the organization based on proven
results. Typically, this approach is utilized
for driving improvements within business
units (BU), based on specific BU goals. A BU
blueprint drives organizational change.
>> Agile improvement adoption: This agile
method of adoption focuses on iterative
changes to the process using a continu-
ous customer feedback mechanism. This
approach is typically suitable for mature or-
ganizations requiring continuous improve-
ments.
Change agent involvement: Involvement
of empowered stakeholders from impacted
groups ensures a smooth process roll-out.
Adoption survey: An evaluation is conducted
as part of the process roll-out to assess
adoption effectiveness.
Piloting: This provides a means of verifying
that the processes will work in a broader
practice and allows for necessary adjustments
before they are fully deployed.
Communication: As part of the program plan,
an elaborate communications strategy is
needed that aligns with overall organizational
communication activities.
Training: Roll-out usually entails training
activities that officially introduce the new or
revised processes. Typically, the process owner
identifies a training subject matter expert who
is closely involved in the process definition to
instruct program participants. A best practice
is to record the training and host it as part of
the companys intranet.
cognizant 20-20 insights
9. Enable effective benefit tracking and
reporting to ensure sustained top
management support.
Key Challenges
Aligning improvement measurements with orga-
nizational objectives has always been a challenge.
In our experience, demonstrating ROI of the
improvement effort has proved to be a bane for
many companies.
Key Recommendations
Based on industry best practices, high-level
benefit categories include reduced cycle time,
improved quality, increased customer satisfaction
and reduced costs.
It is imperative that the metrics are natural
byproducts of the process and that minimal effort
is spent on collecting and reporting. A typical
best practice is to define, baseline and set targets
for benefit measures during process definition.
As part of the implementation, realized benefits
should be assessed on a periodic basis.
Based on our experience, IT organizational per-
formance and process improvement programs
typically help reduce costs by 8% to 10%, reduce
cycle time by 8% to 10%, reduce defects by 10%
to 12% and improve customer satisfaction by 2%
to 5% over a two- to four-year time horizon.
10. Focus on continuous improvement of the
IT organizational performance and process
improvements.
Key Challenges
IT organizational performance and process
improvement is often treated as a project,
whose focus ends with project completion. This
undermines the emphasis on incremental and
continuous improvement to the process.
Key Recommendations
IT organizational performance and process
improvements should be viewed as an ongoing
effort. Once the processes have been rolled out,
the program should be reviewed and adjusted
at least once a year. User feedback, ongoing
assessment of audit findings and effectiveness
measurements drive the future direction of
the improvement. Key success drivers include
continuous planning, monitoring and control of
the organizational process assets.
7
CASESTUDY >>
Enabling a U.S. Insurer to Boost IT Organizational Maturity

Business Situation Level 5: Optimizing. The organization is

Due to accelerated growth, the IT group of a major consistent, reliable and regularly improves and
U.S. insurance company was facing increasing changes itself based on measures.
business expectations. As a result, supporting IT Solution
processes needed to be improved/established.
Created a process improvement team that
rolled under the clients software engineering
An assessment of the IT organizations maturity
process group.
was conducted using Gartners IT maturity model.
Based on the outcome, an organizational maturity Worked with key stakeholders from the client
goal was defined by the CIO. organization to develop a multi-year IT orga-
nizational performance and process improve-
Objective ment roadmap. This effort included:
Achieve Level 3 on Gartners IT maturity model.
>> Identification of the right projects to
Level 1: Ad hoc. The organization does not achieve the maturity level.
specify processes and leaves determination of
>> Determination of the schedule and budget
the right approach to individuals. requirements.
Level 2: Repeatable. Processes are estab-
>> Establishment of the approach and gover-
lished in work teams or departments. Little nance.
consistency of approach.
>> Buy-in from key stakeholders on the road-
Level 3: Defined. Defined and documented map and approach.
processes are established across each applica-
tion discipline. Helped execute roughly 40 IT performance
and process improvement projects using our
Level 4: Quantitatively Managed. Consistent three-step approach (see Figure 6). This effort
measurements are in place to refine and included:
optimize processes.

Three-Step Approach

Organizational readiness

Initiation and Planning Analysis Phase Implementation Phase

Onboard Project Current Future Implementation Communicated Trained Utilized Adopted Benefits Realized
Team Plan State State Plan (Project Closed)
Q4
11 Q1 12 Q2 '12

# Action Item Dec Jan Feb Mar Apr May Jun Owned by Supported by
Pre-rollout activities
1 Develop / update communication material for rollout -Mgmt. Owner -AIT Communication
team
Rollout of Vendor Management
2 Communication on rollout of improved / Target State AIT -Mgmt. Owner -AIT Leadership
Financial Governance CBA processes -AIT Communication
team
3 Conduct training sessions on improved AIT Financial -Mgmt. Owner -Training SMEs
Governance CBA processes for various audiences
-Stakeholders internal to AIT (ROM estimation team,
BRM, IT Leads, etc.)
-Business, PMO, Annuities Finance
-Sample Benefit owners
4 Rollout formalized AIT Financial Governance CBA -Mgmt. Owner -Business
processes -PMO
-Annuities Finance
-BRM
-ROM Estimation team
-IT Leads
Adoption Assessment
5 Assess adoption of Target State Vendor Management -Mgmt. Owner
processes
Project Closure
6 Conduct lessons learned session -Mgmt. Owner

Key Activities Key Activities Key Activities

Onboard the process Perform process improvement analysis and develop stan- Change communication
improvement team. Plan for dard operating procedures for the desired process area. Training
the process improvement. Current-state assessment Adoption success measurement
Project scope Gap identification Project closure/benefit realization
Project plan Future-state definition
Key Deliverables Key Deliverables Key Deliverables
Project charter and Standard operating procedure Communication and training
project plan Implementation plan Benefits measurements
Project closure documentation

Figure 6

cognizant 20-20 insights 8

 >> Development and syndication of the target
state process packages, including process
flows, standard operating procedures, roles
and responsibilities, control gates and mea-
sures, as well as process templates.
>> Development and syndication of high-level
implementation plans to enable the client
to roll out the recommended improvements.
>> Facilitated the roll-out of complex process-
es (e.g., SDLC, Estimation, etc.), even as the
process owner had the primary responsibil-
ity of implementation.
Benefits
We successfully implemented the IT organiza-
tional performance and process improvement
program, delivering the desired benefits of
defined and documented processes across the IT
value chain. The client achieved an 8% improve-
ment in customer satisfaction based on a business
partner survey; a 10% reduction in overall post-
production defects; a 12% improvement in cycle
time due to faster rate of production stabilization
of projects delivered; and approximately 10%
cost savings per year due to a decrease in post-
production defects after the first year of imple-
mentation. The success of the implementation
has encouraged other business units within the
client organization to start emulating the defined
implementation model.

Footnotes
1
An IT operating model is a representation of how an IT organization operates across people/organization,
process and technology dimensions to implement various business objectives.
2
Gartners IT maturity model overview for application organizations,
http://www.gartner.com/resources/175700/175750/itscore_overview_for_applica_175750.pdf.
3
A software engineering process group (SEPG) is a one-stop-shop for driving process excellence within
organizations. Typically, SEPG is responsible for process consultation, process assessments, process
improvements, process asset governance, process training, and process change management.

References
ITIL: http://www.itil-officialsite.com
CMMI: http://www.sei.cmu.edu/cmmi/
COBIT: http://www.isaca.org/Knowledge-Center/COBIT/Pages/Overview.aspx

cognizant 20-20 insights 9

About the Authors
Philippe Dintrans is the Vice President and Practice Leader of the Cognizant Business Consulting (CBC)/
Strategic Services Group for North America. Philippe has led numerous consulting engagements on
business transformation, IT transformation and change management for marquee clients at Cognizant.
Philippe holds a masters of science degree in engineering from the Massachusetts Institute of Technology
(MIT) and an MBA from INSEAD. He can be reached at Philippe.Dintrans@cognizant.com.

Amit Anand is a Senior Manager with Cognizant Business Consulting/Strategic Services. He has 11-plus
years of experience in successfully leading and managing large IT performance and process improvement
initiatives for various clients. Amit holds a bachelors degree from the IIT Delhi and an MBA from the
Indian School of Business, Hyderabad. He can be reached at Amit.Anand@cognizant.com.

Madhusudan Ponnuveetil is an Engagement Manager with Cognizant Business Consulting/Strategic

Services. He has eight-plus years of experience in leading IT performance and process improvement
initiatives, program management and change management. Madhu holds an MBA from Asian Institute of
Management, Philippines, and a bachelors degree in engineering from MSRIT, India. He can be reached
at Madhusudan.Ponnuveetil@cognizant.com.

About Cognizant
Cognizant (NASDAQ: CTSH) is a leading provider of information technology, consulting, and business process out-
sourcing services, dedicated to helping the worlds leading companies build stronger businesses. Headquartered in
Teaneck, New Jersey (U.S.), Cognizant combines a passion for client satisfaction, technology innovation, deep industry
and business process expertise, and a global, collaborative workforce that embodies the future of work. With over 50
delivery centers worldwide and approximately 140,500 employees as of March 31, 2012, Cognizant is a member of the
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and fastest growing companies in the world. Visit us online at www.cognizant.com or follow us on Twitter: Cognizant.

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