CKC - Consulting on your Special Strategic Topics
In our daily practice working with our clients on their digital / IT strategy and developing their digital / IT organization, we often encounter special topics. These are of high strategic value and often act as one of the triggers for our clients to start their strategy development project or to rethink their operating model. Based on our experience and perceived patterns, we have structured them into four clusters: M&A (mergers & acquisitions), leadership change, strategic sourcing, and architectural challenges with strategic impact.
Let's dive into the typical Special Strategic Topics
Digital / IT plays a vital role when considering M&A activities. Although historically less in focus, the overall execution of virtually any business process in IT systems and the high reliance of corporations on their IT have shown its criticality. The value realization of the upfront M&A business cases is highly debated in the industries - an estimate of around 50% hitting their business case and 50% missing expectations seems plausible to us - when thinking in orders of magnitude. One of the main drivers for success or failure is a successful integration and realignment of the business processes, their depiction in interconnected IT systems, and the overall change & transformation management.
We strongly recommend proactively considering digital / IT aspects in any M&A activity. You can adjust the intensity and perform measures depending on your actual context. Along the typical M&A process, we see a few key elements where you should work on the digital / IT aspects at a strategic level:
- Initial considerations and target search
→ Digital / IT Executive Coaching - Target company evaluation (buy side / sell side)
→ Digital / IT Due Diligence - Company carve out planning and execution
→ Digital / IT Carve-Out - Company post merger integration
→ Digital / IT Post-Merger-Integration
At an already very early stage in the M&A process, digital / IT aspects could be influnce. We could help with executive coaching, including specific brainstorming sessions and milestone workshops. Typical topics to be discussed could be such as:
- Market report on known reputation regarding the target or target group for topics around digital / IT (e.g., maturity level indications, security incident headlines, standing at the prominent vendors, industry specifics, etc.)
- Brainstorming on how the M&A process for the specific context can be optimized towards balancing knowledge gain and resource investments for critical digital / IT aspects.
- Accompaniment for specific, critical early-stage discussions, alternatively preparation sessions, and reflections
When performing due diligence (e.g., commercial), you should also consider the digital / IT aspects. We can support you with relevant topics, such as:
- Perform a digital / IT due diligence with a focus on red flags
- Support the M&A team behind the scene and provide a second opinion
- Support the negotiation team with contract and pricing relevant aspects from the digital / IT perspective
Note: The investment in digital / IT due diligence and negotiation support can likely amortize in reduced risks and adjusted pricing.
Carve-out scenarios are a particular form of M&A. We can support you with support, such as:
- Digital / IT strategy for the remaining company, which got certain elements carved out (Scenario A1)
- Digital / IT operating model for the remaining company, which got certain elements carved out (Scenario A2)
- Digital / IT strategy for the new dedicated company that has been carved out (Scenario B1)
- Digital / IT operating model for the new dedicated company that has been carved out (Scenario B2)
- Note: The timing for the scenarios can be different. The strategy development can happen pre-transaction and post-transaction. In practice, it occurs at either time but has other focus areas and priorities.
Post-Merger-Integration scenarios are a common element in the world of M&A. They greatly depend on the overall corporate and M&A strategy, whether acquisitions are loosely or tightly integrated into the overall enterprise. We can support these processes in different ways:
- Digital / IT strategy with a focus on the post-merger-integration, prior to the transaction
- Digital / IT operating model with an emphasis on the post-merger-integration, prior to the transaction
- Digital / IT strategy with a focus on the post-merger-integration, post the transaction
- Digital / IT operating model with a focus on the post-merger-integration, post the transaction
- Evaluations and executive coaching for existing concepts on strategy, operating model, and the following transformation
Depending your company size, industry and type of ownership (private / public) the tenure of a leadership position, such as the CDO or CIO is changing at some frequency for different reasons. In multiple instances we have worked with different clients in such phases of transition. Often the company sets up a digital / IT strategy or operating model development poject, to support the crossover and to adjust specific strategic directions according changed market and corporate conditions.
Over the years we have identified typical patterns and entry points of such a process, and have honed our support accordingly:
- CDO / CIO retirement planning
- Working with an interim CDO / CIO in place
- Support the new CDO / CIO in his first 100 days
Any leadership change can be a sensitive topic for the organization. We always aim to respect the needs of the stakeholder groups while having the overall goals and strategy of the corporation in sight. If we can wish for an ideal constellation, we ask for the following:
- Clear articulation and compatibility between the interests of the retiring CDO / CIO, his direct superior, and the overall management board
- Execution of a digital / IT strategy development project to support the process of leadership transition
- Execution of a corresponding digital / IT operating model project to shape the future organization and set the stage for the succeeding CDO / CIO
Note: The timing of these two projects and the potential transition are specific to the client's situation and should be actively understood and shaped. In an ideal world, the prospect CDO / CIO candidate can participate in the strategy development process, and vice-versa, the experience and mindset of the candidate are a good fit for the envisioned strategic direction of the digital / IT function.
In certain situations, an interim CDO / CIO is in charge of leading the digital / IT area while the organization is preparing to onboard a future permanent staffing of this critical leadership position. We already have successfully supported interim CDO / CIOs and their corresponding board members, who had responsibilities and duties in different areas and brought in a particular background for the critical topics, such as:
- Execution of a digital / IT strategy development project to support the process of permanent staffing of the CDO / CIO position
- Execution of a corresponding digital / IT operating model project to shape the future organization and set the stage for the future CDO / CIO
- (if desired) Coaching the interim CDO / CIO and corresponding board members on the selection process and requirements for the permanent staffing of the CDO / CIO position
Note: The timing of these projects and our onboarding are specific to the client situation and should be actively understood and shaped. In an ideal world, the prospective permanent CDO / CIO candidate can participate in the strategy development process, and vice-versa, the experience and mindset of the candidate are a good fit for the envisioned strategic direction of the digital / IT function.
When you have arrived as a new CDO / CIO in a large and complex organization, it can be crucial to get a fast overview and subsequently provide a set of properly thought-through and clear-cut actions within a short period. A selection of our complete offer of services tailored to this context and timing can be valuable support:
- An independent as-is evaluation with fast results and the option to dive deeper into the most crucial topics to get a quick overview
- Supporting the digital / IT strategy development process to prepare the strategic perspective and derive crucial actions
- Supporting the digital / IT organization development to align the organization to the digital / IT strategy, the needs of the corporation, and the preferences of the new CDO / CIO
- Providing a protected-room in executive coaching sessions outside the system to have an exchange of thought on sensitive decisions with high impact and stakeholder influence potential
Since the early stages of corporate IT and digitalization in the last century, covering sourcing aspects has been essential in many digital / IT strategies. The unique background and experience of Christian Kaliauer can bring a comprehensive and independent perspective on your strategic sourcing topics to your benefit:
- Multiple years working for an international corporation that was heavily transforming their digital / IT sourcing, gaining experience on multiple sourcing life cycles, including mid- and long-term effects
- Multiple years working in strategic consulting at one of the world's largest and well-known sourcing partner for digital / IT services (Accenture)
- Multiple years working at a big4 consultancy internationally well-known for their shared services and outsourcing advisory practice, consulting on sourcing strategy and execution (KPMG)
- Discussing digital / IT strategic sourcing in many of the 60+ consulting projects with various clients
- Academic exposure to shaping supply chain management at the corporate level
Therefore CKC can work with you on your digital / IT strategic sourcing, in particular through:
We can cover the digital / IT sourcing strategy standalone or in conjunction with an overall digital / IT strategy development process. CKC typically shapes a selection of the following topics in the sourcing strategy:
Typical Elements in a Digital / IT Sourcing Strategy | |
---|---|
Service Portfolio, Composition & Mix | Vendor Portfolio |
Strategic Sourcing Guidelines & Policy | Supplier Management |
Geography Leverage & Shoring Model | (Strategic) Supplier Development |
Supply Chain Resilience & Adaptability | Game Changer: Cloud |
Buying Power Conditions & Preferred Contract Models | Game Changer: Automation |
Further Custom Elements | Game Changer: Service Innovation |
Complexity and the level of available experience handling this complexity is a question of perspective. We can offer companies which are facing such a complex sourcing situation in their digital / IT area support for their RFP & negotiation process in ways such as:
- Review the RFP documents and support the creation of specific elements
- Support the RFP team behind the scene and provide a second opinion
- Analysis of received proposals to validate them against the overall strategy, key requirements, and eventual between-the-lines topics
- Support the negotiation process and, in particular, the negotiator with outside experience, either in preparation and reflection sessions or as an accompaniment at the negotiation table
We like to call it the digital / IT trinity - strategy, organization & architecture: We often bring essential know-how on strategy and organization development in our daily work with clients. In contrast, the client has, by nature, a lot of know-how about his digital / IT architecture and relevant development plans. Fusing these three elements brings, in many cases, the most grounded and compelling strategy and target operating model to the corporation.
Accordingly, we bring a range of offerings at the intersection between strategy and organization towards architecture:
- Modern digital / IT architecture vs. organization
- Scenario analysis on strategic architectural topics
- Technical debt management
- Core system(s) strategy & transformation
- Roadmap prioritization
Cloud-native computing, microservices architecture, and related topics are often in stark contrast to established monolithic systems at neuralgic positions. With their as-is technological capabilities, today's corporate digital / IT organizations are typically somewhere between emerging modern and well-rounded established architecture patterns. Shaping the target operating model, the organization needs the capabilities to envision, develop, manage and support this architecture as a whole and its (perpetual) transformation towards the future state. We can support this development and the resolution of potential contradictions by:
- Considering potential architecture vs. organization contradictions, specifically in the digital / IT strategy development process
- Developing an appealing while still realistically achievable target digital / IT operating model
- Working with executives in protected-room coaching sessions to elaborate on crucial topics that are intensively discussed among stakeholders
Specific digital / IT architectural options and directions can become heavily debated in complex organizations (e.g., fundamental decisions on re-platforming, prolonging legacy technologies, individual vs. standard software, utilizing emerging technologies, new architectural guidelines, etc.). We can be of help in such a process via:
- Determining a neutral as-is state through an external evaluation and putting this in context with the overall strategic direction of the client corporation
- Supporting the core team to develop a board-ready decision paper for the strategic options
- Designing and moderating workshops to reach a common conclusion on the scenarios and selection recommendations among stakeholders and experts
- Coaching selected executives on topics such as identification of typical patterns and resolution paths, options weighting, and potential approaches to come to a conclusion in their specific situation
Digital / IT functions in the corporate world commonly discuss the proper level of reducing technical debt against favoring the implementation of new business requirements. Furthermore, there are often different opinions among experts, digital / IT leadership, business peers, and the overall management board. We can help to come to a joint and binding agreement among stakeholders via:
- Performing an independent as-is evaluation of the current situation, backlogs, the state of the project portfolio(s), and stakeholder perceptions
- Including the topic of technical debt management in the overall digital / IT strategy development process
- Designing and moderating workshops to reach a common conclusion on technical debt management among stakeholders and experts
- Coaching selected executives on topics such as identification of typical patterns and resolution paths, options weighting, and potential approaches to come to a conclusion in their specific situation
Typically a corporation has heavily invested in its existing core system over many years. Internal factors, such as - new releases, end-of-life announcements, new products, and architectural trends - as well as external factors such as - strong business growth, new business models, or significant M&A activities - may require a thorough strategy process. In other situations, the corporation has already developed a new core system strategy, is in the middle of the transformation, and encounters significant obstacles. We can support in situations like this by offers such as:
- Performing an independent as-is evaluation with fast results and the option to dive deeper into the most crucial topics to get a neutral overview and (first) recommendations
- Designing and moderating workshops to work with key people on findings of the as-is evaluation and new ways how to overcome the identified obstacles
- Working with executives in protected-room coaching sessions to discuss the situation and weigh options to overcome the impediments vs. reconsidering the enacted core system strategy and roadmap
It is like a law of nature in the world of the corporate digital / IT function - there is a higher demand for projects than actual resources and time available. Combined with the typical estimation bias, which tends to create too optimistically designed roadmaps, it causes the (recurring) need to re-prioritize the strategic roadmap. We can support such re-planning exercises in ways such as:
- Performing an independent as-is evaluation of the current situation, the state of the strategic roadmap, strategic reasoning, and stakeholder perceptions
- Reiterating the digital / IT strategy development process in a lean and suitable manner to accommodate the new as-is situation and eventual changed strategic priorities
- Evaluating alternatives (e.g., innovative sourcing approaches) to improve the throughput and reduce project lead times
- Evaluating and (re-)shaping the digital / IT operating model to reduce bottlenecks and improve project management and execution capabilities
- Working with executives in protected-room coaching sessions to discuss the situation and weigh options in project reprioritizations, throughput improvements, strategic adaptations, and organizational measures
As the title of special strategic topics implies, the subject and situation can be very specific. We would be delighted to personally discuss your situation and critical objectives with you in further detail.