Yes, operational initiatives are nothing new - let’s make that clear right away. We can look for them in the 1970s and 1980s in large-scale product companies, especially in the supply chain area. Going back another decade or two, we find Mission Ops at NASA, the actual mission control room (the term is still in use today). And finally, going back to World War II, we may find ourselves in the British military operations room, reviewing field manuals, learning about operational plans or receiving operational orders. The further back in time we go, the more today’s usually abstract processes and initiatives of the organization gain a physical or literal dimension.
Today, however, is not about that.
I’m writing this to give structure to my knowledge and experience of the last 13–14 years of work (mostly in the broader IT area) and to organize my thoughts related to current and future transformations in organizations, including predictions for market, society and technology changes. This is no revelation, let alone a flawless text. I feel that I am the main recipient of this series, but if it helps someone additionally - the greater will be my satisfaction with the work done.
The intensifying breeze of market corrections
We overinvested in the 2020–2022 period, swayed by cheap and widely available capital in the reality of relatively low inflation and objectively low interest rates. Both have rebounded boldly to the upside, and the pandemic boom is over, so companies are taking a noticeable “inhale” in the market - and see if they will suffocate from it or survive.
In this cutting off of external resources (such as software houses), adjustment of employment (especially of juniors), the pressure for efficiency and profitability continues to grow. Investors’ demands for financial performance naturally translate into cost-cutting, including personnel costs. This narrative has been further compounded by the euphoria in the AI space (2022+) and the kindling of hopes that the new buzzword will be a panacea balancing reductions and bringing companies to a level of profitability above the circa-pandemic prosperity.
The mistakes we’re not aware we’re reading
AI is the new mass incantation (remember blockchain? or “an uber for…” ideas?), with which it is easy to seal the lack of competence in the area of solving sometimes even basic problems. There is a growing number of AI specialists in the LinkedIn bubble, but there is also no shortage of charlatans or - above all - people who are helpless in the face of new solutions and often do not understand that “I asked ChatGPT…” does not necessarily mean that they have reached the truth. When you add to this the fact that hallucinations can be compounded by training models based on data that is flawed or even fake news - there is no moment of reflection to subject the machine’s answer to criticism even in one’s own mind.
In decision-making areas, but also closer to end-users, it is worthwhile to conduct evangelistic activities that explain in an accessible form that generative algorithms are something different from machine learning; that automation (especially based on simple if/then instructions) is not AI. That prompting training is most often not worth your money. And that AI agents will be another area to look at with caution.
The temptation of assets internalization
In parallel with hiring adjustments and helplessness in the face of accelerating change that structures, regulations and processes cannot keep up with, there is a natural desire to keep the most valuable talent inside the organization.
Even at this stage, we can consider how organizations define the value of talent:
- people as documentation because nothing was written down,
- people that are most cost-effective relative to KPIs,
- people that are the most determined or desperate relative to bringing value,
- people with the longest seniority,
- people with the greatest potential, even if not yet quantifiable.
A healthy mix of the above is usually needed.
The need of governance in the mix of old and new
The combination of internalization, financial caution and global multidimensional change makes it easy to grasp low-hanging fruits of innovation - or their mirages - in the dark. Risk rises. Competence support disappears.
This is where small cross-area units are needed at a whole new level of competence, decision-making and trust from the entire company, starting with the CEO.
More companies wanting to keep up with their transformation will need Ops initiatives on the board level, not department level.
And I have a few more thoughts to share about that.