When SOEs encourage a responsibility-avoiding fantasy...

By Rick Jelliffe
February 8, 2010

(A follow up to this week's The problem with Standards Operating Environments and An SOE comedy of errors, and see the comments.)

Our Nick Carr gave me a heads-up about an article in The Economist print edition (Dec 3rd 2009) Silo but deadly: Messy IT systems are a neglected aspect of the financial crisis .

It deals with general fragmentation of technology in financial firms, and the issue of people needing to use ad hoc desktop applications comes up: a manager says 'The big task of management is to manage down the number of spreadsheets'.

The most interesting comments for me are the paragraph on 'deskilling' (to what extent does the provision of centralized applications and limited SOEs result in the abdication of responsibility by management for ad hoc spreadsheets?: or to put it positively, if you know that your staff will use their own spreadsheets when the central service is inadequate, what provisions are in place to make sure that these ad hoc spreadsheets conform to the organization's accounting and risk standards?) and the paragraph that contrasts 'data warehouses' with real-time 'feeds'.

SOEs that are not agile and aligned with worker's requirements are counter-productive and cause the proliferation of ad hoc, unmanaged, non-standard operating environments (or, at best, a blackmarket SOE that actually does the job.) The less that agility is possible, or the less that the central office is capable of identifying and analysing every class of user and provisioning them appropriately, the more that some other strategy is appropriate. (In comments in a previous blog, Bill Donaghoe suggested clouds may have a place by allowing outsourcing of SOE provision: a market for SOEs! Departments can select their optimal SOEs according to their budget.)

Nick's comment to me that the adoption of ad hoc desktop computing should perhap be taken as a sign that the centralized applications are inadequate:

Maybe their existing system is defined by the IT staff and how _they_ express requirements, rather than how traders express requirements (same problem as the legislators and IT). For that reason, the traders are neither responsible, nor accountable for the systems. And funnily enough, neither is IT! Cause bad risk and Excel aren't their problem...


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