Risk, generally, accompanies older or overly complex IT, Humphries says, and mitigating it was a key part of the business case for FedEx's new data center. "Our infrastructure profile was growing too risky," he says.
Staffing simplicity projects requires some care. Managers often issue unclear directions and take too long to make decisions, Ashkenas says. "Simplification is a concept that can be difficult to articulate. It means more than cutting," he says. For example, rearranging business processes requires understanding large ideas, such as how customers interact with the company or what federal agencies require for compliance. Existing technology must be mapped to show where the information related to those ideas resides. Then debates can begin about what to change.
To make simplicity work, companies need thinkers who are a little bit tactician, but also visionary and inspired by challenge, Ashkenas says. People get depressed by an effort that feels like an exercise in cutting alone, he says.
As Begley subtracts at GE, she is also building. For example, GE opened an IT security center in Virginia last year. So far, 85 employees work there. This summer, the company plans to open another IT facility in New Orleans, where up to 300 people will work in enterprise architecture, data management, networking and other functions for GE Capital. A new IT center is under construction in San Ramon, Calif., too. GE expects to hire 1,100 IT workers in all as it pulls back some outsourcing work it had sent to India. Simplification doesn't mean cutting alone, Begley says. "Excellence is the priority."
GE picked top performers across IT and business functions to collaborate in person and by video in conference rooms about how to consolidate processes and applications. They borrowed agile development methods, such as setting weekly milestones and appealing to decision makers to solve problems the same day as they are discovered. "One thing that drives me crazy--I'm not an IT person--is everything seems to be a three-year project," Begley says. "We're trying to get away from [that]."
Spelling out clear goals for each person on the team has kept GE's simplicity quest on track, she says. CIOs in business units have to report to her and their business managers quarterly about whether they made their goals to, say, eliminate a given number of ERP systems. Begley must meet yearly objectives set with Chairman and CEO Jeff Immelt and the board. "We have dashboards with names, dates and the people who care."
She expects payback from this work in two to three years and plans to invest some of the returns in cloud and mobile technology.
Getting It Done
Simplicity doesn't happen naturally, so CIOs should make detailed plans. Tactical moves include whittling down the number of IT suppliers you count as essential, which streamlines more aspects of the operation than technology and support choices do. This may lead to fewer contract negotiations, better pricing and stronger relationships. At GE, each business unit has now chosen core technologies and vendors and intends not to deviate, Begley says. As key software is upgraded, GE's IT group will avoid much customization, which adds complexity and cost. "No matter what you're running, you're going to be more competitive if you go faster. I'm bringing that mind-set to IT," Begley says.
Sign up for CIO Asia eNewsletters.