From the formation of a learning organization, it is important to support learning and critical thinking, sharing new ideas and disseminating new knowledge across all departments, no matter what the situation is economically. The structure of the company should ideally allow for separate departments to have freedom to try innovative solutions and technologies, test different ways of building teams, and so on. Heads of departments may use very different methods of reaching their goals, which should later be documented, and regulated. This way it’s possible to see which methods are effective and can be adopted overall. But the amount of innovation and experimentation will largely depend on the state of the markets in any given economy.
The market changes every quarter, if not every month. Economic and political changes affect the state of the IT sphere. If an organization uses stable yet rigid mechanisms to ensure its infallibility, when fast transformations are necessary, such organizations may sink, like a tank in the bog. There is no flexibility for them to change as fast as the moment requires. Such mechanisms are also dangerous because they drain resources and often fail because of the ‘all eggs in one basket’ scenarios.
For IT companies, there are three possible market situations that affect their ability to survive and thrive:
In a crisis, the price of IT services and products becomes a number one priority, with everyone looking for the cheapest resource possible. If an IT company focuses on hiring top specialists who do only innovative, high-end projects, in a crisis such a company may run into a risk of not having enough customers to stay afloat. It may even collapse, and start fresh after the crisis is over and expensive projects are up for grabs again. Learning budgets are influenced by the effect of delayed expectations, where the business decision to invest into new developments may be postponed for a period of time (from a few months to a year).
Quality is the most important commodity in such a market. In a growing market, there may be more demand for companies boasting high level IT staff, and there is no shortage of extra funds that can be spent on learning. But the many firms who only differentiate themselves by offering low prices and speed may suffer, with the talented staff leaving to do more ambitious projects and clients being unsure of the overall quality. Even though such companies will always have their share of the market, such an approach stunts growth and is not geared towards long-term success.
In a stable market, all kinds of IT companies may have their place under the sun, with cheaper projects going to the low-level firms and prestigious undertakings being snatched by the best IT teams in the world. A healthy IT organization should try to offer affordable prices with quality being stable and guaranteed on every project. In a stable market, a portion of the profits should be allocated to learning.
Since most of the time, the world operates in stable and growing markets, diversifying efforts is the most viable approach. If the company tries different business models within its walls, it can survive much easier. Using the right business model at the right time is the only way to evolve into a better business.
New business models should be evaluated properly, however. When a new business model is tested within one department, it can either succeed or fail, with very little effect on the bigger system. When the whole company takes on something new, it is a great risk in case of failure. This method applies to trying instruments, methodologies, technologies, experiences, documentation types, presentations, anything that can perfect business and IT but should be tested before full implementation.
Working in different markets as a learning organization can teach IT companies to mobilize their forces and survive in any situation. Have you ever operated in an unstable market? Have you successfully driven your company out of a crisis? Are market fluctuations a true test to the resilience of an IT company? Please share your thoughts and stories below.