6 signs it’s time to restructure your IT organization

As the restructuring planning begins, all stakeholders should be given the opportunity to voice their concerns and needs equally. “This is the only way to establish an IT culture that doesn’t erode from within,” Kirkham says. The restructuring should also establish priorities that contribute to the enterprise’s overall well-being, including its internal and external security.

5. Essential tasks are forever stuck in neutral

IT has fallen into a rut. Critical attributes, such as innovation, initiative, and transformation, are either absent or rarely seen. Decisions are made slowly, reluctantly, and infrequently. Meetings may be held to discuss critical issues, but end without resolution.

Meanwhile, necessary changes remain in limbo, as previous decisions are questioned during the execution phase. “These [signs] often signal there’s confusion as to who the key stakeholders are, where authority lies, or [there’s] a mismatch between organizational structure and how work is intended to flow,” says Ola Chowning, a partner with global technology research and advisory firm ISG.

“Delays or erratic workflows may be the result of organizational confusion,” Chowning observes. She notes that confusion is usually caused by a disconnect between the organizational structure and the operating model, and typically manifests over time. “This may be due to a new way of operating — such as a move to agile or product-oriented delivery, the distribution or centralization of major functions, or the influx and/or outflux of people,” Chowning says.

Full restructuring is a drastic move. Chowning believes that it’s a decision never to be made lightly. “Departments should make sure a reorganization is being done for a specific reason or need, and not as a knee-jerk reaction when a key leader exits, when a new CIO enters, or because it hasn’t been done in a while,” she explains. “Reorganization should signal to the entire department that you are expecting changes to outcomes and ways of working.”

Creating the new operating model will require a significant amount of time. “My experience has been anywhere from five to eight weeks for the complete design,” Chowning says. “Placing names in frames and selecting leaders, if that’s required, would follow, and that timeline is most often dependent on the HR practices of the enterprise.”

6. IT has a lousy internal reputation

The most important sign that something needs to change is when C-suite colleagues begin harboring a negative perception of the IT department, says Ben Grinnell, managing director at business and IT consulting firm North Highland. “Common perception issues include when IT is viewed as a cost center by the CFO; when IT is the last place the business turns to for help with digital innovation of its products and services; and when IT has more roles that don’t work directly with the business than those that do.”

To counter negative perceptions, the CIO should consider reconfiguring IT into a more flexible structure. “The organization’s efforts should be outward facing, with the goal of changing the perception of IT,” Grinnell explains. He advises CIOs to tap into discussions about how IT can drive revenue and increase margins through innovation, and what investments will be needed to enable change.

IT is an ecosystem, Grinnell states. “Any restructuring needs to include the entire workforce, including the employees, consultants, contractors, system integrators, and outsourced elements.”

Grinnell believes that IT restructuring should never treated as just another project. “It should be viewed as an always-on transformation, not a project that will one day be finished,” he explains. “That’s an unrealistic goal that sets the team up for failure.”