Data is a key enabler in enterprise IT, but there are more aspects to consider before deciding what solutions or systems to implement. Deborah Nightingale, Professor of the Practice of Aeronautics and Astronautics and Engineering Systems and Co-Director, MIT Lean Advancement Initiative, recommends an approach that is “looking at the whole enterprise in a more holistic way. It starts with the strategic objective, and then understanding what’s going on around you” – ecosystem, stakeholders, and then thinking about it from multiple dimensions, she explained in a live interview with theCUBE co-hosts Jeff Kelly and Dave Vellante at the MIT CDOIQ conference.

Vellante stressed that IT permeates every part of our life and our organizations much more so than ten or twenty years ago. He asked if this development has made her mission harder or easier. Nightingale’s answer was, “both.”

Because IT is such a key enabler, organizations can do things they were not able to do before. “You can come up with new business models, new ways of doing things,” but IT needs to be used in an effective manner, otherwise it creates more chaos, Nightingale explained. That requires presenting a more systematic approach based on concepts of system engineering and organizational change that highlight where and organization is going and how it gets there.

Asked to describe the typical situation she encounters in an enterprise, Nightingale said “often times they have taken a very siloed, reductionist approach.” Or they have already gone through failures and want to avoid them. The typical go-to scenario is “When in doubt, let’s reorganize.”

She used Netflix as an example, who a few years back decided to split the online streaming from the DVD business. They did not check with the stakeholders, who were not very happy with the decision, so the company needed to change back.

She also typically helps organizations that have grown really rapidly around a new technology or product, but “don’t know how to design the organization to really take advantage of that.”

Explaining how she goes about having everyone involved better communicate, Nightingale said one of the most effective ways is to get everyone in the same room — top management, IT, HR, finance, and “getting them to understand who are the stakeholders, what is their value. They do not understand what the stakeholders want from them,” although typically they know what they want from the stakeholders.

She then helps them understand what’s working and what’s not working. The next step is “getting them to create a shared vision of where they want to go. Often times they all have a vision of where they want to be. Getting them to collectively define this, and share it, and then getting them to think about the future and which are some options on how to architect it” is the goal, Nightingale explained. In short, “getting them to think about things before they go and change everything.”
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Impacting business decisions as CDO

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“When you work with an organization, how prescriptive do you get, specifically with the role of the CDO?” Vellante asked. Nightingale responded that “data and information, they run everything within the organization. Once you get the strategic direction and everyone agree on that,” then you can decide on a specific data system.

Asked if there was a consensus for a the need of a CDO in the organization, Nightingale said “there isn’t a consensus yet, but it is evolving. There’s also this movement towards distributed things, and part of the challenge is what things do we need to standardize, and what things does that really not matter.”
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Commenting on whether the CDO should report to the CIO, Nightingale stated ”they need to be tightly integrated. Where they report is very much a function of the culture of the enterprise they are working in. They need enough access to the CEO to understand what the strategic drivers are. I think that reporting higher in the organization is an important piece to that.”

CDOs have to be integrated along with a whole lot other things. “I don’t think you can totally separate them,” Nightingale shared, going on to say that CDOs should be given autonomy to do their job. “I think it’s probably better if they report to the same individual,” she concluded.

Asked about the most common mistakes organizations make, Nightingale said that many times they want to solve a problem in a certain way, when they actually have a different solution that is more effective.

She exemplified with a hospital wanting to fix the emergency department. ”They wanted to put in some new technology to check in people faster.” After analyzing the whole hospital, the conclusion was that 30 percent of patients were in the ER because they could not see their primary physicians, or because they were waiting for their rooms to be cleaned and prepared for admittance, or they were waiting for lab results. The solution was to open an after-hours walk in clinic, to fix lab turnaround time, and implement a way of signaling when rooms needed to be made available.

Another prevalent problem is starting with “the IT data system as the solution when they don’t really understand the problem.”