Dr. Quirin Görz has one of the coolest jobs in enterprise tech—and one of the hardest. As the CIO of KUKA, a pioneering robotics company, he serves a diverse portfolio of business segments, each with its processes, app landscape, business lingo.
And its own priorities.
Deciding which new projects to accept, and then how to scope and pace them, is a downright hairy task. That’s especially true when organizations lack a clear view of their shared technology resources and how decisions contribute to the bottom line. In most enterprises, their IT landscape is like a puzzle, except it’s really four puzzles mixed together (and some of the pieces fit more than one puzzle).
Without a clear, shared understanding of enterprise IT resources, it’s nearly impossible to make rational decisions—and to justify them to stakeholders.
How KUKA built a foundation for strategic IT investment decisions
As a starting point, Görz’s team modeled business capabilities to provide a common denominator between the business segments: a shared language of core capabilities. His team took a top-down approach, starting with outside research as a guide, but then refining the model and stress-testing it with stakeholders across the business.
Using an enterprise architecture management tool, the team mapped critical business capabilities, like product management, software development, and sales and marketing. It also showed the IT resources supporting them and dependencies between them.
This tool served as a knowledge repository for the whole IT team. Critically, it also helped segment leaders understand the big picture when they negotiated technology requests.
Görz shared his full process in his presentation at last year’s LeanIX Connect Summit in Bonn, Germany:
Diplomacy starts with shared language
Enterprise tech leaders have to serve both business stakeholders from different units, but also the greater good of the organization. It’s no easy task: it often means saying no to new requests or setting longer than preferred timelines. Sometimes it also means saying yes to requests but delivering them but under different terms (e.g., different technology or processes) than stakeholders asked for.
KUKA’s pace layering methodology starts with bucketing all new projects to a business domain, and categorizing them into three areas to facilitate pacing and staff decisions:
1. Innovation:
Every capability supporting new features, products and business models gets added to this budget. Görz advises caution in allowing too much to get tagged in the innovation category. “Be careful, if you talk to colleagues in the business … they always think they’re innovative.” He addresses this by advising a maximum range of 10% for each business segment’s budget to be used for innovation.
2. Differentiation:
Görz defines this as important features that differentiate the segment’s products and services from those of competitors, and his team works with segment leaders to understand what those features are. This makes up to 20% of budget.
3. Commodities:
Unlike capabilities in the Differentiation and Innovation buckets, Commodities don’t drive new revenue or business models, so efficiency is the goal. In this case, Görz says, IT chooses the tools and processes.
KUKA’s pace layering methodology makes it easier to make the best decisions to serve the overall organization, and to negotiate and rationalize decisions with stakeholders. Mapping IT resources and dependencies sets them up to make decisions quickly and rationally—and seize the most important opportunities.
LeanIX Connect 2022: Poising organizations for always-on innovation
Innovation isn’t just for technology pioneers like KUKA—in an age of lightning-fast disruption, it’s the key value driver for every enterprise. Organizations that don’t find new ways to delight customers, earn more revenue, and react to threats and opportunities will get outrun by those that do.
That’s why we’re excited about this year’s LeanIX Connect theme: Innovation for the Always-On Enterprise. Consider this our invitation to hear from thought leaders like Dr. Görz on capitalizing on pandemic-driven digital transformation investments to build a long-term innovation engine.
