ITIL and culture exemplified by IS, Maersk Oil. Christian G. de Lichtenberg & Sune D. Müller, October 2015

Transcription

1 ITIL and culture exemplified by IS, Maersk Oil Christian G. de Lichtenberg & Sune D. Müller, October 2015

2 Maersk Oil at a glance OPERATED PRODUCTION 550,000 boepd Greenland Norway OPERATED FIELDS 26 UK Denmark Kazakhstan MAERSK OIL GROSS ACREAGE 54,000 km 2 USA Algeria Qatar Kurdistan Abu-Dhabi WORKFORCE IN 12 COUNTRIES 4,500 employees LICENCES operated Brazil Angola The value chain HEADQUARTERED IN COPENHAGEN WHOLLY-OWNED SUBSIDIARY OF APMM Exploration Appraisal Development Primary production Mature field EOR Abandonment Business Development 2

3 Case study: Information Solution (IS) in Maersk Oil Cause for wonder IS Strategy v3 reinforces the journey for IS becoming more effective and recognised as a vital partner for the business Previous research has shown that: Processes and roles of ITIL can help the implementing organization become more effective and customer-oriented ITIL implementation is challenging because of incongruence between ITIL and the organizational culture We try to understand: How can ITIL support IS in achieving the strategic goal of being more effective and customer-oriented? What cultural challenges arise when implementing ITIL, and how can the challenges be mitigated? 5

4 As-is culture Methodology Case study Organisational culture is a pattern of shared basic assumptions that the group learned as it solved its problems of external adaptation and internal integration, that has worked well enough to be considered valid and, therefore, to be taught to new members as the correct way you perceive, think, and feel in relation to those problems Edgar H. Schein Dominant characteristic Service Strategy Organisational leadership Criteria of success Organisational glue Strategic emphasis IS assessment ITIL analyse Service Design Service Transition Service Operation To-be culture Management of employees Continually Service Improvement Identifying the challenges of the cultural gap supports initiation of relevant mitigation action enabling you to harvest value from strategic initiatives 6

5 OUTPUT MAIN ACTIVITIES PURPOSE Method driven by a simple process By observing the areas of greatest discrepancy between the preferred future culture and the current culture on the profiles, a road map for change can be determined - Cameron & Quinn 2006 FIND OUT WHAT CULTURE ITIL DEPICTS ASSESS THE CULTURE OF IS COMPARE AND ANALYSE THE TWO CULTURE PROFILES Understand the underlying culture for ITIL and each of the phases Outline the organisational culture for each question and for IS a total Understand what are the key pain point of use ITIL framework in IS Analyse each of the five ITIL books using the OCTAT text analysis tool Create a culture profile for each ITIL phase using the Competitive Values Framework graphs Send out questionnaire to all IS employees in Copenhagen Create a culture profile for each question and IS as a whole using the Competitive Values Framework graphs Analyse the profiles for ITIL and IS and highlight for incongruence, strength, effectiveness, etc. Analyse what are the differences between the profiles and challenges in unite the cultures An individual culture profile for each ITIL phase A culture profile for ITIL in total Sheet with answer values A culture profile for each question A culture profile for IS in total An understanding of the underlying culture of ITIL An outline of the IS organisational culture A list of main challenges and mitigation proposals 7

6 Methodology Tools IS assessment ITIL analysis Questionnaire based on OCAI (Organizational Culture Assessment Instrument) Culture profiles Web service based on OCTAT (Organizational Culture Text Analysis Tool) Competing Values Framework 8

7 Content Theory Theory Analysis Outcome 10

8 Competitive Value Framework Theory Dimension and Organisational culture types 11

9 The Competing Values Framework Theory The Four Culture Archetypes The Clan Culture A very friendly place to work where people share a lot of themselves. It is like an extended family. The leaders, or head of the organization, are considered to be mentors and, maybe even, parent figures. The organization is held together by loyalty or tradition. Commitment is high. The organization emphasizes the long-term benefit of human resource development and attaches great importance to cohesion and morale. Success is defined in terms of sensitivity to customers and concern for people. The organization places a premium on teamwork, participation, and consensus. The Adhocracy Culture A dynamic, entrepreneurial, and creative place to work. People stick their necks out and take risks. The leaders are considered to be innovators and risk takers. The glue that holds the organization together is commitment to experimentation and innovation. The emphasis is on being on the leading edge. The organization s long-term emphasis is on growth and acquiring new resources. Success means gaining unique and new products or services. Being a product or service leader is important. The organization encourages individual initiative and freedom. The Hierarchy Culture A very formalized and structured place to work. Procedures govern what people do. The leaders pride themselves on being good coordinators and organizers, who are efficiency minded. Maintaining a smoothrunning organization is most critical. Formal rules and policies hold the organization together. The long-term concern is on stability and performance with efficient, smooth operations. Success is defined in terms of dependable delivery, smooth scheduling, and low cost. The management of employees is concerned with secure employment and predictability. The Market Culture A results-oriented organization. The major concern is getting the job done. People are competitive and goal oriented. The leaders are hard drivers, producers, and competitors. They are tough and demanding. The glue that holds the organization together is an emphasis on winning. Reputation and success are common concerns. The long-term focus is on competitive actions and achievement of measurable goals and targets. Success is defined in terms of market share and penetration. Competitive pricing and market leadership are important. The organizational style is hard-driving competitiveness. 12

10 Competitive Value Framework culture profile Theory Example profile Example data Dominant Characteristic Clan 45 Adhocracy 35 Market 10 Hierarchy 10 13

11 The Competing Values Framework Theory Organisational Leadership The most effective leadership styles tend to match the organization s culture [Cameron & Quinn, CVF] Clan culture The most effective leaders are parent figures, team builders, facilitators, nurturers, mentors, and supporters Adhocracy culture Effective leaders tend to be entrepreneurial, visionary, innovative, creative, riskoriented, and focused on the future. Hierarchy culture The most effective managers are good at organizing, controlling, monitoring, administering, coordinating, and maintaining efficiency Market culture The managers rated as most effective tend to be hard-driving, whip-cracking, backside-kicking competitors. They are good at directing, producing results, negotiating, and motivating others 14

12 The Competing Values Framework Theory Organisational Effectiveness The criteria of effectiveness most highly valued in the culture types Clan culture Cohesion, high levels of employee morale and satisfaction, human resource development, and teamwork Involvement and participation of employees foster empowerment and commitment. Committed, satisfied employees produce effectiveness. Adhocracy culture New products, creative solutions to problems, cutting-edge ideas, and growth in new markets. Innovation and new ideas create new markets, new customers, and new opportunities. These outcomes comprise the basic indicators of effective performance Hierarchy culture Efficiency, timeliness, smooth functioning, and predictability. Control fosters efficiency (elimination of waste and redundancy) and therefore effectiveness. Market culture Achieving goals, outpacing the competition, increasing market share, and acquiring premium levels of financial return. Competition creates an impetus for higher levels of productivity and therefore higher levels of effectiveness. 15

13 The Competing Values of Leadership, Effectiveness, and Organizational Theory Cameron & Quinn, 2006 Theory 16

14 Diagnosing and changing organizational culture Theory Culture Profile Interpreting The highest score identifies the basic assumptions, styles, and values that predominate Areas of discrepancy can determined a road map for change Compatibility with long term goals, styles and inclinations Helps identify what should be increased, what should be decreased Effective organisations shift to a more rule based culture as they develops and grow Organisational Culture Strong cultures are associated with homogeneity of effort, clear focus, and higher performance Highly effective organisations often has high congruence is the culture Congruence The higher the score of one culture type the stronger or more dominant is that culture Contradictory cultures is more incongruent than when adjacent quadrants predominate The less variance between the profiles the more congruence in the culture 17

15 Consequences of Organizational Incongruence Theory Consequences Creates discomfort in the organization, leading members to complain about ambiguity, lack of integration, and absence of fit Leads to differences in perspectives, goals, and strategies Leads to hypocrisy when observed organizational behaviors are incompatible with what is perceived to be the espoused values. Hypocrisy is often one of the major symptoms that incongruence exists in a culture Sap the energy and the focus of organizational members Incongruent cultures are more typical of lower performing organizations than congruent cultures Stimulates an awareness of a need for change. Increased motivation for change in the culture may be a desirable result Temporary incongruence may be functional in that it highlights aspects of the organization that are uncomfortable, or it can uncover previously unacknowledged aspects of the culture that are dysfunctional 18

16 Content Analysis Theory Analysis Outcome 19

17 Culture profiles of ITIL v3 books Analysis Congruent Strong Effective CVF profiles based on the OCTAT analyse of the five ITIL v3 books 20

18 Analysis Culture assessment of IS Dominant characteristic Organisational leadership Management of employees Organisational glue Strategic emphasis Criteria of success IS total/average Clan Adhocracy Market Hierarchy One profile for each area Areas of interest OCAI result of the IS assessment 21

19 OCAI culture profiles of IS Analysis 1. Dominant Characteristics 2. Organizational Leadership 3. Management of Employees Internal focus Clan Flexibility & discretion Adhocracy External focus Internal focus Clan Flexibility & discretion Adhocracy External focus Internal focus Clan 28 Flexibility & discretion Adhocracy External focus Hierarchy Market Hierarchy Market Hierarchy Market Stability & control Stability & control Stability & control 4. Organization Glue 5. Strategic Emphases 6. Criteria of Success Internal focus Clan 33 Flexibility & discretion Adhocracy External focus Internal focus Clan 23 Flexibility & discretion Adhocracy External focus Internal focus Clan Flexibility & discretion Adhocracy External focus Hierarchy Market 37 Hierarchy 21 Market Hierarchy40 22 Market Stability & control Stability & control Stability & control CVF profiles based on the IS assessment 22

20 Incongruence comparing ITIL and IS Analysis Organizational success depends on the extent to which your organization s culture matches the demands of the competitive environment. Cameron & Quinn,

21 Content Outcome Theory Analysis Outcome 24

22 Findings Outcome 1. Clan is what holds IS together Use Clan actively to empower and involving employees in defining, creating and filling in the cross-organisational ITIL roles and to transform in from technical specialist to process owners 2. Working in silos based on a top-down hierarchic Should be played down and replaced by personal objectives to work cross functional based on shared processes and procedures as a means of measuring organisational success 3. IS has less Market focus compare to ITIL Increase customer focus in IS by a closer and more continuous engagement with the business; define a Business Relation Manager (BRM) role and implement a BRM for each business area with responsibility of Service Strategy 4. Management of Employees is divided Agree on one path/one culture type to support in all means supported by a common (ITIL) language 25

23 Conclusion The challenges of cultural incongruence Outcome The only thing of real importance that leaders do is to create and manage culture and that the unique talent of leaders is their ability to work with culture. [Schein 1994, p. 14] The ITIL implementation in IS should not be a project solely for culture change The challenges mentioned are seen as important to deal with in order to ensure successful implementation of ITIL The challenge for IS management is to implement the changes so that they become the new way people act and behave This requires changes to be implemented in the core of the culture, i.e. changes in the underlying assumptions of the culture 26

24 Qualitative interviews Analytical context Outcome Maersk Oil in cultural transition like the rest of the group. More commercial. Results-oriented. Clear strategic positioning. Focus on cost structure. From a re-active doer culture to a more proactive, performance oriented, commercial, and global organization. 27

25 Qualitative interviews ITIL implementation challenges Outcome Many cultures within Corporate IS and IS across Maersk Oil. Within: ITIL received differently across the four service areas due to different perspectives on the need for documents, policies, and procedures. From not sharing objectives to depending on each other. Across: Culture clashes in the transition from chiefdoms to performance based organization. Depending on local resources that corporate does not control. IS implementing service management on corporate mandate without selling the vision. IT not a core capability (IT as a commodity). No perceived value in cross-bu process integration. Incremental vs. radical roll-out ( cherry picking and the big picture). 28

26 Qualitative interviews Positive forces Outcome Fit between Maersk group values and ITIL. ITIL as an industry standard. Not built in-house, i.e. no baggage. ITIL enables a common language within IS. Strategic alignment: ITIL as part of the strategic transformation of the IT business. IS strategy inspired by and in accordance with ITIL. But need for goal agreement: increased efficiency vs. effectiveness (lower costs vs. better IS-business processes). But need for agreement in terms of level of ambition: 1 st division vs. Champions League. 29

27 Qualitative interviews Implementation strategy Outcome Communicate the vision. Transition from Clan to Market through Hierarchy. ITIL implementation through means associated with Hierarchy (e.g. structure, control, and governance). BUT avoid bureaucracy. Keep performance and market orientation of ITIL. Don t get stuck in Hierarchy. Stay agile. Empower individuals despite need for bureaucracy and documentation. Focus on ITIL on a principle level as opposed to the nitty gritty details. 30

28 Summary Recommendations to you! Outcome Focus on the why before what and how. Connect to values and strategy execution. Consider big bang versus salami approach. Adapt improvement tactics based on organizational culture and values underlying the model/standard (ITIL) used for process improvement. Maersk: Involve and empower employees: set boundaries instead of instructions. Embrace business processes as means to institutionalize Market values, e.g. customer and performance orientation, but do so cautiously. 31