For long Industry has used the term Knowledge Transfer for the exercise between the new team and the incumbent as part of takeover proceedings. However a transition of this nature does not occur just by transferring knowledge. This type of transition is really about taking ownership. Hence we use the term Ownership Transfer instead of Knowledge Transfer. An Ownership Transfer exercise never occurs in isolation. The purpose of the transfer is quite often accompanied with a transformation dimension. It could be for many reasons.
- Most often the reason for transfer is cost. The costs are running high and the organisation looks for a way to bring down their expenses.
- In some cases, it is about expanding capability and capacity of the IT unit. The organisation may realise that it’s core expertise does not reside in IT. In order to keep up with the changing times it decides to partner with an IT expert
- Some IT units may feel constrained because they are heavily dependent on one IT partner. This may drive the group to diversify their vendor portfolio
- Geo political reasons to bring work onshore can drive an ownership transfer.
- Or it may perhaps be the final phase of a build operate transfer (BOT) for an organisation
Any of the above instances will show that an Ownership Transfer is really a change management exercise. As part of the transition, one will see changes to working relationships, processes and even technology. Hence it is crucial to look upon such exercises as transformation exercises and not merely as transition exercises. Articulating this view provides a lot of opportunities for the leadership to create a motivating environment for the new team as well as the incumbents to participate in this program. Everyone is involved in creating the future. The new team will be living with that future, and the incumbents will move on to create the future in another place.
A change management exercise by its very nature takes time to fructify and settle. Culture and process changes typically take longer to set in. Hence it’s important to start an ownership transfer early and plan the exercise over a long duration. This affords the leadership an opportunity to evolve the direction of the exercise based on feedback from the field as well. In one of our transfers at ThoughtWorks, the team realised that the incumbent had lost all context on a particular module. Since no defect or new features had come up on that module for two years, the incumbent team’s knowledge on that module had become quity rusty.
The management after discussion decided not to spend effort transferring that module. The incumbent team would have had to first learn and then teach the new team. If the incumbent could learn, so could the new team by themselves. Also the fact that no defect or enhancement has come up in that module for two years gave the management assurance on taking this approach.
For long Knowledge transfer exercises have been dealt with by applying Theory X as developed by Douglas McGregor. Theory X in short says that people in general dislike work. Hence they need to be instructed, forced and micro-managed. Theory Y on the other hand encourages creating the right working environment that will motivate employees to enjoy their work and give out their best. Ownership Transfer exercises must be planned and executed with a high percentage of the Theory Y philosophy. The transformation angle provides fertile ground for a motivating environment. At the same time, certain stakeholders within this exercise, such as the management of the incumbent would not find this exercise incentivising enough. This is understandable since their targets and key performance indicators do not reflect success of such an exercise. Hence the IT leadership would do well to incentivise the incumbent management, so that they will be sufficiently motivated to keep key personnel invested in the exercise over a longer duration. It’s important to emphasise that such incentives must be planned over longer durations (and not based on next quarter results). For example a financial incentive for the incumbent linked to production availability 1 year post transition completion can go a long way in keeping these stakeholders engaged in the exercise.
- Do it smoothly – no knee jerks and no need to cut off unless there are geo political or regulatory risks. One should negotiate contracts around the new philosophy.
- Provide for incentive to the incumbent so they can plan their business well and not cause disruption to your by pulling out key people in an unplanned way.
- Induct new staff, via pairing actively. Track only via new metrics.