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Is Your IT Adding Value to the Business?

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Working hard is great, but if you are not focusing on what is important to the business, all that hard work is misguided or inappropriate. Info-Tech Research Group states that 47% of business leaders feel that business goals are unsupported by IT. Wow, that seems incredibly high. Clearly, there is a disconnect between IT and business leaders. Wait a minute: shouldn’t the head of IT be a business leader too? If IT fails to support the projects or programs that benefit the business, then IT is perceived as not delivering value, not contributing to increasing revenue or reducing costs, and basically providing very little real value.

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Your Challenges

You may be presented with several challenges as you embark on ensuring that IT is aligned with the business:

  • The business may not view IT as a strategic partner. Many CIOs or senior IT people are not invited to participate in any of the organization-wide strategic planning and decision-making activities. Or, the business may not even be interested in strategic IT planning.
  • It may also be that the IT department does not have the expertise or capacity to develop an effective strategic plan for IT. IT strategic planning can require a highly specialized skill set and resource commitment. It is rarely successful if approached as an “oh, by the way” activity.
  • In some cases, IT strategies tend to focus mainly on technology and fail to cover other areas and are often “too technical” and written in a language the business cannot understand.

What’s Alignment Mean?

Here is a textbook definition, a bunch of words, I know, but they are important: The art and science of formulating, integrating, and implementing decisions between the business and IT, which enables an organization to achieve its business objectives. The “science” part you likely have covered: you are very technically savvy with solid expertise. But regarding the “art” part of the equation, you will need to rely heavily on soft skills—such as speaking, writing, presenting, and leadership—to ensure you make alignment happen.

So, when someone in a company says, “we have aligned our IT to the business,” they mean that their business organization is able to use information technology effectively to achieve business objectives, resulting in improved business outcomes such as enhanced financial performance, better products, services or marketplace competitiveness. The bottom line is the ability of IT to create business value.

So, are you aligned? Let’s see, pop quiz. For everything you do in IT, can you say the following: what my team is doing now results in adding business value? Oh yeah, the kicker: can you prove it? That is, can you connect the dots between your activities and meeting business requirements? If not, you must inspect what you are doing and adapt so that your team or organization is, in fact, focused on always adding business value. Then, you will be aligned.

As you can see in the figure below, in this simple example, all the IT goals do in fact map to business goals. Basically, to answer the pop quiz, line up all the business goals, then make a list of all the major IT work you are doing that accounts for at least 85% of your budget, and see what happens. Anything that doesn’t map should be analyzed to figure out why it is not aligned, and be stopped, reduced, or adjusted accordingly. 

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Effects of “Misalignment”

Let’s talk about what can go wrong if the work your team does is not aligned to the business. Many people think: I am coding away all day, I think I am doing what is important, or what difference does it really make? Well, it might be minor, but it could affect your job or even your career.

Let’s explore these questions and think about how you would answer them:

  • Is your team working on the right priorities?
    • So, what is the right priority? You need a process to identify and prioritize your demands and work to ensure they are aligned with the business.
  • Is your team helping the business achieve its maximum potential?
    • So, what is the maximum potential? You need a process to determine what the ‘right’ work is from the business standpoint. Just working on ‘stuff’ is not enough; it must be the right stuff.
  • Do you and your team feel connected to the business?
    • I think this one might be most important. I truly believe that if you and your team feel connected to the business, you will feel that your contributions really mean something and that they have an impact on the business and its customers. This improves morale and productivity, and in fact, reduces turnover.
  • Do you sense a mistrust and misunderstanding between the business and IT personnel?
    • In my career, I have seen time and time again this ‘misalignment’ between IT and the business that results in less productivity and increased organizational issues. You must have good processes by which the business and IT get together and understand the business goals and how IT can help achieve them. This collaboration helps build trust and, I think, will make your job must more rewarding and fun too.
  • Is there analytics-driven visibility into IT’s contributions?
    • The business needs to see and understand the impact of IT to their bottom-line using real-time visibility into key business performance indicators. But ultimately, the business needs to weigh the cost of service delivery against the value the service brings to the business. And how can they do that without good data that you should be providing?

Your Next Step

This is truly a partnership. Without the business providing a strategic roadmap with goals and objectives that are measurable, how can you align your work to it? Well, you might think you can’t, but you still can. Though it would be ideal to have business planning documents (and believe me it is), in the event you do not have the necessary planning documents, the next step is to work with the business to develop your IT strategic plan. Dialog is key. You need a solid understanding of the organization’s business needs, drivers, and constraints in order to build an effective IT strategy and plan. And you can’t get that without developing and nurturing a concrete communication platform and supporting planning processes. Creating and executing a successful IT strategy will help drive IT into a leadership role—especially if the organization has not yet formulated a formal strategy of its own.

The Bottom Line

Articulating a clear IT strategy that aligns IT with business objectives is the most important activity a CIO, IT department head, or you can do for the IT department and organization. What are you waiting for? Start today.

Want to Learn More?

If you want to learn more about:

Michael Krasowski

General Manager

Fairway Technologies Inc.

mkrasowski@fairwaytech.com

 

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