How IT shops become bureaucracies

An Advice Line reader floats a nautical-themed theory on how once-lean companies get mired down with bloat and barnacles

Dear Bob ...

I have been thinking of running a concept by you for some time.

I often think about things in nautical terms. As such, I came up with a nautical-related analogy concerning barnacles to how our IT shop is run, especially in light of how bigger and older businesses become the slower and less adaptable with time.

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When a company first starts up, it usually has a very lean approach, it has the best and brightest (hopefully) doing the startup, and it can build its IT shop with all new computers and with fresh lean software designed for their specific purpose. This gives these new startup companies the ability to be versatile in the face of change, able to adapt at a moment's notice.

Eventually, though, they begin to settle in, and the various departments that spin off find the databases and procedures too lean for their flavor of bureaucracy, so they ask that the IT shop begin adding on various new fields or patches, new reports, and new utilities that mine the data every way imaginable. They end up with what I call barnacles, and the once-streamlined sloop is now a barnacle-encrusted freighter that is slow to adapt. All the energy in the IT shop is now focused on maintaining the patches on top of patches, and by my experience eventually there comes a fear of even touching the old Cobol-based database that was written by developers long ago dead, so they add even newer GUI interfaces to talk to the old database in carefully formatted ways -- even more barnacles, even more friction to the overall flow of the business.

Well, you get the picture.

Here is where keeping the business running is the most tricky. You cannot afford to dry-dock to get rid of the barnacles unless you can build a whole new boat to back up the old one and stay in business.

What usually happens is the energetic business leaders split off from their old company and build a new one that can dance circles around the old freighter. The old freighter plods along until it becomes forgotten (IBM) or just a long-floating eyesore (AT&T) that handles the commodities of the business while everyone else innovates around them. Those energetic leaders are now lost to the original company.

Seems to me we need someone to champion a business model where you can have new boats launched and the ability to dry-dock the old systems while they are brought up to date. Otherwise, the entropy will set in and every successful company will eventually find themselves old and irrelevant.

- Barnacle Bill

Dear Barnacle Bill ...

I like the metaphor. What I'm not sure about is how well it illustrates the situation -- fun, though.

Here's the challenge: Compare two companies of the same age. Both were lean, agile, nimble, and so on when they started. One stayed small -- successful enough to keep everyone happy, not so successful that it grew beyond a few hundred people. The other was terrifically successful and grew to more than 10,000 employees.

Compare the two for barnacles and what do you think you'd find?

In my experience, which is broad enough to give me some confidence and not so broad as to provide any certainty, barnacle-ness is more a function of size and success than of age. It's when business turns into bigness that the encrustations happen.

Even harder to deal with is this: Every so often, I run in to a very large company that has avoided the barnacles. They tend to be very badly run.

Big companies aren't just like small companies, only taller. They are different in fundamental ways. For example:

  • In a small company, one person can entirely understand the company. In a large company, were a person to try to fully understand how things work, that person's head would explode.
  • In a small company, most responsibilities are handled by one person, which means they're handled consistently without having to write anything down. In a large company, most responsibilities are handled by teams, and without documentation and training they'd be performed differently depending on which person performs them, often creating chaos in the process.
  • In a small company, it's easy to build trust because everyone knows everyone else as a person. In a large company, many business processes involve people who have never met each other.
  • In a small company, the CEO can understand everything important about what's happening in the company by walking around and chatting with people. In a large company, were the CEO to take this approach, his or her children would reach retirement age before the first loop was completed, which means CEOs and other corporate executives have to rely on indirect forms of organizational listening to get a handle on things.

It takes more overhead to run a large company than a small one, but this doesn't mean there aren't barnacles a-plenty. It means distinguishing between a barnacle and a rivet can be more difficult than you might think.

- Bob

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