The Next Leap in Productivity: What Top Managers Really Need to Know about Information Technology

4.23. Which Kind of CEO Do You Want to Be?

There is an important lesson for CEOs here. In the 1970s, top management at General Motors (GM) and other automobile manufacturers believed that they were producing the best car they could at the time. Many of today's top IT managers have this same mind-set today: They think their organizations are producing the best software they can.

As a result, they are reluctant to invest in improving the infrastructure and the process. However, Toyota executives realized that if they invested in improving their production lines, they would see improvements in market share. Roll forward 30 years, and you see the result: Toyota captured a significant market share, which GM lost. The lesson is the same. If you do not adapt, you will be left behind.

If you do what ADP recommends, you actually improve productivity. First, you overlap QA with development. Say your QA usually lasts four months after development; if QA overlaps with your development phase, you save on four months of QA payroll.

Second, you put standards in place, which relieves you from the need to do a great deal of testing, and saves you money. There is another benefit, too: Developers become more innovative and more creative, which leads to higher quality.