Although IT tends to look at innovation through a technology lens, a slightly different perspective reveals ample room for management innovation as well. One of the things emerging from our research is a new emphasis on how companies engage skilled labor. This is particularly true after the most recent economic downturn. Business leaders increasingly want to move their labor costs from fixed to variable. These new approaches allow organizations to move away from the rigid resource models of the past and become more flexible and effective.
We all know that the global economy and major shifts in technology—from the cloud to Big Data—are creating huge challenges for IT. In another era, one of America’s iconic industries faced equally daunting challenges, which shook filmmaking to its bedrock. From the early days of Hollywood, a few major studios and movie moguls controlled the industry, including the stars, directors, stage workers and writers. It was one big, efficient monopolistic family. That was until antitrust and other lawsuits broke up this so-called Studio Model and threatened the existence of Hollywood movies.
New thinking avoided “The End” of Hollywood
As we know, the cameras didn’t stop rolling. The studios reinvented themselves. A new, more agile model emerged in which a producer brings in skilled people to handle specific roles—from actors to directors to key grips. Unlike in the previous factory system, these roles are temporary, and the producer is one of the few resources that actually remain with the company. So, in this model, the producer is a fixed cost, and everyone else is variable. Resources are brought in to meet the specific needs for the project and then when the film is in the can they go away.
Applying this so-called Hollywood Model to enterprise IT enables organizations to drive success with flexibility. As an analogy, if you were a producer making a light romantic comedy, you might not want the studio to dictate Martin Scorcese as your only choice of a director. Despite his extraordinary skill and many successes making films like Taxi Driver or Goodfellas, you would probably prefer the flexibility to work with a director more suited to the script in your hand.
Similarly, as complexity in the IT environment grows, you need the flexibility to choose just the right people to solve specific problems. Adopting the Hollywood Model could enable you to begin transforming the hierarchical structure of a traditional IT organization with matrixed teams that bring together the right match of skills to achieve specific goals. And increasingly, companies can achieve these goals by hiring people for outcomes, rather than for their time. In short, it replaces the emphasis on individual careers, rigid org charts and static teams with an emphasis on results. It also allows organizations to shift labor costs from fixed to variable, and align labor costs more closely with demand.
Experimenting with new ways to achieve business goals is one way to change the thinking that “innovation” is about gadgets like the smartphones. If you really stop to consider, innovation is about doing something different—whether it is business models or sourcing skilled labor—that brings value. I hope you will spark a conversation within your organization about some of the emerging innovative management resource models, and if you’re in IT, what you need to do to facilitate and enable them.
Have you seen any interesting human resource models start to emerge in your workplace?