Common Mind Traps in IT Operating Model Design

The impact of common mind traps on designing an IT operating model can be significant, influencing strategic decisions, resource allocation, and the overall effectiveness of IT operations. Awareness of these mind traps is essential for designing an IT operating model that is aligned with the organisation's goals, adaptable to changing circumstances, and capable of driving innovation and efficiency in IT operations. By recognising and mitigating the influence of these biases, stakeholders can make more informed, objective decisions that lead to the successful design and implementation of the operating model.

Here's a few examples that illustrate how common mind traps can affect the IT operating model design process:

IKEA Effect

Stakeholders may develop a sense of attachment or ownership towards certain aspects of the operating model, such as internally developed processes or tools. This can result in resistance towards adopting more efficient or effective external solutions, even if they would better serve the organisation's needs.

• In - House Developed Software - The IT department has invested significant time and resources in developing custom software solutions tailored to the organisation's specific needs. Despite the availability of more efficient or cost - effective external software solutions, stakeholders within the organisation have developed a strong attachment to the in-house developed software. This attachment leads to resistance towards adopting external solutions, even if they offer better features or scalability, as stakeholders perceive the internally developed software as uniquely tailored to their needs.

• Heavily Customised Processes - Over time, the IT department has customised various operational processes and workflows to align with the organisation's unique requirements. These processes have become ingrained in the organisation's culture, and stakeholders have developed a sense of ownership towards them. When presented with opportunities to adopt more standardised or streamlined processes, stakeholders resist the change, fearing that it will disrupt established workflows and diminish their sense of ownership and control over the processes.

• Proprietary Tools - The IT department relies on proprietary tools developed internally for monitoring and managing IT infrastructure and services. Despite the availability of commercial off - the - shelf (COTS) tools that offer advanced features and integration capabilities, stakeholders are reluctant to adopt external solutions. They have become attached to the internally developed tools, perceiving them as superior or more closely aligned with the organisation's needs, and resist adopting external solutions, even if they would better serve the organisation's requirements.

Confirmation Bias

Designing an IT operating model may be influenced by a confirmation bias, where stakeholders may seek out information that confirms their pre - existing beliefs about the most effective structure or approach. This can lead to the adoption of operating models that may not be the best fit for the organisation's needs or goals.

• Preference for Centralised Structure - The CIO of a large organisation has always believed that a centralised IT operating model is the most effective approach. When tasked with redesigning the IT operating model, the CIO primarily seeks out information and expert opinions that support their belief in centralised control. As a result, the new operating model heavily favours centralised decision - making and control, even though a decentralised or hybrid model may better suit the organisation's diverse needs and goals.

• Vendor Preference - The IT leadership team has longstanding relationships with a particular technology vendor and has always been satisfied with their products and services. When designing the new IT operating model, the team primarily considers solutions offered by this vendor, dismissing alternatives from other vendors without thorough evaluation. Despite potential benefits offered by competing vendors, such as lower costs or better integration capabilities, the team's confirmation bias leads them to adopt solutions from their preferred vendor.

• Technology Adoption Bias - A project manager is passionate about Agile methodologies and firmly believes that Agile is the best approach for all IT projects. When designing the IT operating model, the project manager advocates for Agile practices to be integrated into every aspect of the model, from project management to software development and operations. Despite concerns raised by other stakeholders about the suitability of Agile for certain projects or teams, the project manager's confirmation bias leads them to prioritise Agile over alternative methodologies without considering the organisation's broader needs and goals.

Sunk Cost Fallacy

Past investments in existing operating models may lead stakeholders to resist changes or improvements that would require abandoning or replacing existing systems or processes. This can result in operating models that are outdated or inefficient, despite opportunities for optimisation or modernisation.

• Legacy System Maintenance - The IT department has invested significant resources in maintaining a legacy software system over the years. Despite its outdated technology and inefficiencies, stakeholders are reluctant to consider replacing the system due to the substantial investment already made in maintenance and support. As a result, the organisation continues to allocate resources to keep the legacy system operational, even though modernising or replacing it could lead to significant efficiency gains and cost savings.

• Resistance to Change - A project manager is leading an initiative to upgrade the organisation's infrastructure to a more scalable and flexible cloud - based solution. However, stakeholders, including senior management, are hesitant to approve the project due to concerns about the financial costs and potential disruptions to existing operations. Despite the clear benefits of the proposed upgrade, stakeholders are reluctant to move forward because they perceive the investment in the current infrastructure as a sunk cost that should not be abandoned.

• Process Overhaul - The IT operating model includes a set of processes and procedures that have been in place for many years. Despite feedback from staff members about inefficiencies and bottlenecks in these processes, stakeholders are resistant to making changes because of the time and effort invested in developing and implementing them. Even though optimising or streamlining the processes could lead to improved productivity and cost savings, stakeholders are hesitant to abandon the familiar routines and systems they have become accustomed to.

Anchoring Bias

Being anchored to initial ideas or concepts about the IT operating model may prevent stakeholders from considering alternative approaches or adapting to changing circumstances. This can lead to a reluctance to explore new ideas or innovations that could improve the effectiveness of the operating model.

• Initial Proposal Fixation - At the outset of the IT operating model design process, a senior IT manager proposes a specific framework that they believe will address the organisation's needs. Despite subsequent feedback and suggestions for alternative approaches from other stakeholders, the team becomes anchored to the initial proposal. They are reluctant to deviate from the original concept, even when presented with evidence that alternative models may offer better alignment with the organisation's goals or changing circumstances.

• Historical Precedent - The IT department has historically operated under a particular structure or set of processes that have become deeply ingrained within the organisation. When tasked with redesigning the IT operating model, stakeholders are anchored to these historical precedents and are hesitant to consider alternative approaches. Despite recognition that the existing model may no longer be optimal or adaptable to evolving business needs, stakeholders are reluctant to explore new ideas or innovations that could improve its effectiveness.

• Leadership Bias - The CIO has a strong preference for a specific IT operating model based on their previous experiences or personal beliefs. When presented with recommendations for alternative models that may better suit the organisation's current needs or future objectives, the CIO remains anchored to their initial idea. They are unwilling to entertain new concepts or innovations, leading to a stagnation in the design process and a reluctance to explore potentially more effective approaches.

Loss Aversion

Fear of failure or disruption may lead IT leaders to design conservative operating models that prioritise risk avoidance over innovation or efficiency. This can result in operating models that are overly rigid or resistant to change, hindering the organisation's ability to adapt to evolving business needs.

• Resistance to Cloud Adoption - IT leaders may be reluctant to migrate critical systems and data to the cloud due to fears of data loss, security breaches, or service disruptions. As a result, they design an operating model that prioritises maintaining on - premises infrastructure, even if cloud solutions offer greater scalability, flexibility, and cost - efficiency. This conservative approach hinders the organisation's ability to leverage the benefits of cloud technology and adapt to changing business demands.

• Reluctance to Experiment with New Technologies - IT leaders may be hesitant to invest in emerging technologies or innovative solutions due to concerns about the potential risks and uncertainties associated with adoption. As a result, they design an operating model that favours proven technologies and established practices, even if newer technologies offer greater potential for innovation and competitive advantage. This reluctance to experiment stifles creativity and inhibits the organisation's ability to stay ahead of industry trends and disruptors.

• Overemphasis on Stability - IT leaders may prioritise stability and reliability in the operating model to minimise the risk of system failures or service disruptions. As a result, they design functions and processes that are overly rigid, have a complex governance structure, and resistant to change, making it difficult to adapt to evolving business needs or technological advancements. This emphasis on stability at the expense of agility and innovation hinders the organisation's ability to respond quickly to market changes and capitalise on new opportunities.

Hindsight Bias

Viewing past operating models or approaches as more successful or effective than they actually were may lead stakeholders to design the new operating model based on flawed assumptions or incomplete analyses. This can result in operating models that fail to address the root causes of previous shortcomings or inefficiencies.

• Over-reliance on Past Solutions - IT stakeholders may view past operating models or approaches as highly successful, attributing the organisation's past successes solely to these models. As a result, they design the new operating model by replicating elements of these past solutions without thoroughly evaluating whether they are still relevant or effective in the current context. This overreliance on past solutions may lead to an operating model that fails to address emerging challenges or capitalises on new opportunities, as it is based on outdated assumptions and incomplete analyses of the organisation's current needs.

• Ignoring Past Failures - Conversely, IT stakeholders may downplay or ignore past failures or shortcomings in previous operating models, focusing only on the positive aspects. As a result, they design the new operating model based on a selective interpretation of past experiences, failing to recognise and address the root causes of previous inefficiencies or shortcomings. This oversight may lead to the repetition of past mistakes and a failure to implement necessary changes or improvements in the new operating model.

• Misjudging Past Successes - IT stakeholders may overestimate the effectiveness of past operating models or approaches, attributing the organisation's past successes to factors that may not have played as significant a role as perceived. As a result, they design the new operating model based on a skewed interpretation of past successes, potentially overlooking alternative approaches or innovations that could lead to greater success in the current environment. This misjudgement may result in an operating model that fails to adequately address the organisation's current challenges or capitalise on new opportunities, as it is based on an inaccurate understanding of past achievements.