Before embarking on an IT performance and process improvement program, companies should first understand the critical success factors so they can successfully advance their business objectives and increase adoption across the enterprise.

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

2. 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 The next section describes how to effectively lay
IT organizational performance and process out the vision of such initiatives, as well as effec-
improvements. tively manage the implementation journey for
achieving desired goals and outcomes.
The New IT Mandate
Several technology trends are building the case Top 10 Imperatives for IT Improvement
for enhancing IT performance, including exter- 1. Obtain senior leadership commitment to
nalized service delivery, global market demand, initiating and managing IT organizational
increased data volumes, social media explosion, performance and process improvement ini-
IT in business shared services and increased tiatives.
complexity of the IT ecosystem (see Figure 2, next
Key Challenges
page). Overcoming these challenges will help the
IT organization increase its agility and respon- IT organizational performance and process
siveness to business requirements. improvements require sustained effort and
commitment across all levels of the organization.
IT organizations are responding to these trends The morale of employees and their involvement
by adopting effective IT operating models (see in the improvement initiative is directly related to
Figure 3, page 4). The building blocks for any CIO/top management commitment and clarity of
IT operating model — organization, process and goals.
technology — are undergoing a radical rethink to
ensure tight alignment to meet the demands of Key Recommendations
the aforementioned trends. Based on our experience, IT organizational per-
formance and process improvements that have
To improve their IT operating model, companies been driven or sponsored by the highest levels in
are increasingly adopting IT performance and the organization are more likely to succeed. We
process improvement initiatives based on indus- advised one of our clients to include improvement
try-standard frameworks such as CMMI, ITIL, goals and objectives as part of the company’s CIO
COBIT, Lean, etc. to support and drive changes to performance targets and cascade them down
their IT organizational functions or technologies. to various departmental leaders. This strategy
resulted in increased commitment from all levels.
cognizant 20-20 insights 2

3. 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, large insurance clients define and manage a com-
leveraging standard models, for defining prehensive two-year roadmap to transition from
realistic improvement goals. Level 2 to Level 3 on Gartner’s IT maturity model
(see sidebar, page 8).
Key Challenges
It has been a challenge to establish appropriate 3. Focus on identifying the right processes
goals and objectives for an IT organizational per- and their process owners to achieve the
formance and process improvement initiative. established goals.
Various organizations have struggled to set
Key Challenges
realistic goals based on change management
considerations. Based on the maturity assessment, once the
organization is made aware of areas for improve-
Key Recommendations ment, the next challenge is to identify process
IT organizational performance and process areas with high impact and associate them with
improvements should focus on every aspect of the right process owners.
the IT value chain (as described in Figure 4, page
Key Recommendations
5) and set up realistic goals that reflect the orga-
nizational appetite for the change. There are A software engineering process group (SEPG)3
several industry-standard assessment models — or dedicated cross-functional team respon-
(e.g., CMMI, ITIL, the Gartner IT maturity model,2 sible for driving the performance and process
etc.) that could help chart out an improvement improvement initiative — should lead the exercise
roadmap. of identifying process areas for improvement and
associating them with the right process owners.
The two forms of assessment methods seen in This should be conducted via a series of program
the industry are formal third-party assessments definition workshops involving key stakeholders
and self-assessments. The choice of a maturity from each of the IT functional areas.
model and assessment methodology will depend
on the focus of the improvement initiative Based on our experience of implementing such
(e.g., CMM/CMMI is more focused on software programs, the appropriate process owner should
processes, while ITIL is aimed at operations), be someone who is involved with many aspects
organizational relevance and cost considerations. of the process. When there are multiple entities
It typically takes 18 to 36 months to transition using a process equally, then it is best to assign
from one level to the next. We helped one of our the process governance or ownership to a broader
cognizant 20-20 insights 3

4. 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

5. Key Recommendations 6. Establish a governance model that enables
Organizations should focus on establishing an effective management of the program.
effective marketing strategy that helps sustain Key Challenges
enthusiasm for IT organizational performance The lack of well-thought-out program governance
and process improvement efforts. Key facets of impedes progress due to delays in decision-
an effective marketing strategy are as follows: making (e.g., funding, resourcing, change
management, etc.).
• Effective delivery of program- and project-level
messages. Key Recommendations
• Assurance that marketing is a continuous Effective governance depends on factors such as
endeavor throughout the lifecycle of the the organization’s culture and size, the diversity
program. of IT functions, improvement approach chosen,
• A cost-effective approach that leverages etc. It is, therefore, best to include representa-
existing organizational communication vehicles tion from all functional areas within the organi-
as much as possible. zation in the governance model (see Figure 5,
next page). Typically, three to four governance
Our experience reveals that some of the most elements are needed:
effective marketing channels for IT organization-
al performance and process improvement include • Executive leadership team: The team
roadshows, newsletters, company town halls and responsible for sponsoring the program and
program portals/internal Web site postings. One reviewing/ approving the roadmap, budgets
of our large insurance clients used a combina- and progress.
tion of roadshows, newsletters and an annual
• Program steering committee: Typically made
company town hall meeting to champion its
up of a cross-functional set of senior team
program. These mechanisms allowed our client to
members. This group regularly advises perfor-
establish a bi-directional communication medium
mance and process improvement teams on the
(i.e., communicate the improvement initiative
changes desired, plans, progress and status.
and also gather feedback on refinements to
the initiative) that resulted in greater employee
engagement and success.
Key Focus Areas for IT Performance and Process Improvements
1 Software Engineering Processes
2 Business Relationship Engagement
3 Architecture Management
®
CMMI Maturity Model ITIL
Project monitoring and control 4 Project Portfolio Management
Service desk Incident
Project planning management
5 IT Workforce Management
Requirements management Problem management
Supplier agreement management 6 Application Portfolio Management Configuration management
Measurement and analysis Change management
Configuration management 7 Sourcing and Vendor Management
Release management
Etc.
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 measures, indicators, processes and best
Delivery and support practices, to assist in maximizing the ben-
Monitoring and evaluation efits derived through the use of information
Etc. technology, and developing appropriate IT
governance and control in a company.
Figure 4
cognizant 20-20 insights 5

6. • Software engineering process group: Made activity to be of lower priority and do not focus on
up of process experts and champions to drive it adequately, leading to a prolonged turnaround.
the improvement program. Moreover, standard process definition shortcom-
ings often create difficulties in adoption across
• Performance and process improvement
the organization.
team: Formed as needed to execute perfor-
mance and process improvement activities (i.e., Key Recommendations
analysis or aid in implementation). This group
We recommend involving dedicated subject
is often led by a member of the SEPG and made
matter experts for process definition. It is also
up of consulting subject matter experts.
essential to standardize the organization’s
• Program manager: Depending on the scale of processes, including process descriptions, process
the IT organizational performance and process maps, roles and responsibilities, and measures.
improvement program, a dedicated program
manager is required to manage the program • Process description: Clearly illustrates the
from inception to closure. purpose of the process. The description may be
depicted graphically, textually or both.
Importantly, periodic governance reviews among
these three to four teams ensure that the initiative • Standard operating procedure: SOPs provide
is continuously steered in the right direction. a repeatable way of executing the process.
It includes process maps, roles and respon-
The following review checkpoints are usually rec- sibilities, templates, guidelines, standards,
ommended for successful program execution: checklists, etc.
weekly status reporting, monthly steering
• Measures and metrics: This enables measure-
committee updates and monthly process owner
ment of the improvements and successes of
forums (i.e., fortnightly meetings to share lessons
the initiative.
learned across implementations).
8. Facilitate organizational change manage-
7. Develop processes that are standard and
ment to ensure smooth implementation of
“fit to use.”
the recommended improvements.
Key Challenges
Key Challenges
CIOs and top managers most often treat IT orga-
In our experience, the biggest constraint to a
nizational performance and process improve-
successful IT organizational performance and
ments as internal projects that can be performed
process improvement program is resistance to
by employees on a part-time basis. This approach
change.
fails in most cases, as employees consider the
Governance Model for the IT Improvement Program
Executive Program Steering
Leadership Team Committee
Performance /
Process
Improvement
Program Team, Led by
Manager SEPG
Process Owner 1 Process Owner 2 Process Owner 3 Process Owner N
Figure 5
cognizant 20-20 insights 6

7. Key Recommendations 9. Enable effective benefit tracking and
• Adoption model: There are several ways to reporting to ensure sustained top
adopt effective IT organizational performance management support.
and process improvements. Some of the best Key Challenges
ways to do so (but not exclusive of each other) Aligning improvement measurements with orga-
include: nizational objectives has always been a challenge.
>> Top-down adoption: This approach first In our experience, demonstrating ROI of the
focuses on appropriate buy-in at the cor- improvement effort has proved to be a bane for
porate level (top management) and then many companies.
drives adoption down to the individual busi-
ness units. Key Recommendations
Based on industry best practices, high-level
>> Bottom-up adoption: This approach
benefit categories include reduced cycle time,
assumes that change is defined for any
improved quality, increased customer satisfaction
smaller sub-group through a project, or
and reduced costs.
a series of projects, and is then adopted
across the organization based on proven It is imperative that the metrics are natural
results. Typically, this approach is utilized byproducts of the process and that minimal effort
for driving improvements within business is spent on collecting and reporting. A typical
units (BU), based on specific BU goals. A BU best practice is to define, baseline and set targets
blueprint drives organizational change. for benefit measures during process definition.
>> Agile improvement adoption: This agile As part of the implementation, realized benefits
method of adoption focuses on iterative should be assessed on a periodic basis.
changes to the process using a continu-
Based on our experience, IT organizational per-
ous customer feedback mechanism. This
formance and process improvement programs
approach is typically suitable for mature or-
typically help reduce costs by 8% to 10%, reduce
ganizations requiring continuous improve-
cycle time by 8% to 10%, reduce defects by 10%
ments.
to 12% and improve customer satisfaction by 2%
• Change agent involvement: Involvement to 5% over a two- to four-year time horizon.
of empowered stakeholders from impacted
groups ensures a smooth process roll-out. 10. Focus on continuous improvement of the
IT organizational performance and process
• Adoption survey: An evaluation is conducted
improvements.
as part of the process roll-out to assess
adoption effectiveness. Key Challenges
• Piloting: This provides a means of verifying IT organizational performance and process
that the processes will work in a broader improvement is often treated as a project,
practice and allows for necessary adjustments whose focus ends with project completion. This
before they are fully deployed. undermines the emphasis on incremental and
continuous improvement to the process.
• Communication: As part of the program plan,
an elaborate communications strategy is Key Recommendations
needed that aligns with overall organizational IT organizational performance and process
communication activities. improvements should be viewed as an ongoing
• Training: Roll-out usually entails training effort. Once the processes have been rolled out,
activities that officially introduce the new or the program should be reviewed and adjusted
revised processes. Typically, the process owner at least once a year. User feedback, ongoing
identifies a training subject matter expert who assessment of audit findings and effectiveness
is closely involved in the process definition to measurements drive the future direction of
instruct program participants. A best practice the improvement. Key success drivers include
is to record the training and host it as part of continuous planning, monitoring and control of
the company’s intranet. the organizational process assets.
cognizant 20-20 insights 7

8. CASE STUDY >>
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 client’s software engineering
An assessment of the IT organization’s maturity
process group.
was conducted using Gartner’s 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 Gartner’s 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

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

10. 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 master’s 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 bachelor’s 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 bachelor’s degree in engineering from MSRIT, India. He can be reached
at Madhusudan.Ponnuveetil@cognizant.com.
About Cognizant
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