Yes we can, yes we must: the ongoing case for IT/Business alignment

How do we (IT executives) get away from being typecast as technologists, unconsulted on core business issues and approaches? Face it, that’s a common situation and dilemma that we all encounter, early and often, and it’s the grist for a constant mill of articles and blog posts and books on business/IT alignment.

Lately, though, a part of that mill has started insisting that focus on technology should be avoided altogether by what they usually cast as the “next generation” of CIO.  So I’m going to (again) be a bit of a contrarian here: it’s possible for the pendulum to swing too far in the wrong direction. I think that we can at times go overboard in our desire to avoid being seen as the geek with the pocket protector.  Examples: some preach outright denial that there might be such a perception problem: don’t even think of using the terms “IT” and “business”, they urge, and they recommend against ever discussing “alignment” as a goal.  Stop referring to the “business” as something separate, they recommend; IT is just as much part of the business as anything else! Similarly, their advice is “avoid discussing the technology itself.” As if a mere shift in language could solve the perception problem and automatically propel the CIO into the inner circle of decision-makers.

Here’s the gist of how I see it, though: in many (I daresay most) companies, the path of IT from high priesthood to strategic key playerdom has not really been fully traversed: in other words, greater alignment IS still needed of IT with “the business.”

In many companies, there’s still a trust problem. IT is arcane. IT can be as resented as a roadblock as the in-house corporate counsel types who veto certain kinds of corner-cutting.  Of course we’re “part of the business” (and increasingly so), but that doesn’t mean it’s wrong to continue to focus on breaking down the walls that linger.  The walls, in many/most places, are a reality, and it’s going to take steady, relentless, active work, not just a shift in language, to scale them. What especially will not help our effort to do that is if we embrace this odd trend of sneering at technology as a lesser-order concern—basically, positing that we should let someone else do that while we do the important (strategic) stuff.

In other words, I differ (vehemently) with those folks who now look down on such things as the need to align IT with the business, or who don’t recognize the benefits that come from regarding people as “internal customers”, or who recommend even avoiding using the terms “IT” and “business”. While the basic spirit behind those sentiments is of course valid—again, it’s undeniable that IT is part of the business, as much as any other department—it is in fact IT that has a problem in how it’s perceived by other elements of the company, going back to the high priesthood. Let’s be frank: IT folks have often been snooty, vague, cagey even, about what we do, why we do it, and how we’re meeting the company’s business needs as a whole. Deprecating the important progress and mentality shift that’s occurred in the last few years (that is, the high priesthood evolving to a service mentality) is exactly the wrong approach.

And somehow, inexplicably, the deprecators are getting louder, despite years of research and general agreement on the value of approaches such as IT governance, the ongoing need for IT/business alignment, etc.

Taken to an extreme, insisting loudly that IT is part of the business can extend to feeling that IT knows just as much about what’s good for certain business processes (say, manufacturing or shipping or collections or whatever) as the people executing those functions on a daily basis.  From there, it’s just a small but perilous step back into the old sort of IT arrogance, where systems were designed and deployed with little or no feedback from the actual users.  I exaggerate? Quite possibly, but I’ve seen it happen.

IT needs to both know its place and insist on its place, not one or the other. Here’s another example of a truly ham-fisted (even though well-intentioned) attempt to align IT more closely with business: I took over as CTO at a high-profile internet company, in the midst of deep, bet-the-company changes to its main product, a consumer-facing web site. I learned in my first few weeks that my predecessor had initiated a robot project.  His idea was apparently that he’d program this robot to walk the halls of the company, greeting people and thus making them feel more comfortable with technology. As Dave Barry is fond of saying, I am not making this up.  Needless to say, this project swiftly became a laughingstock across the company, representative of IT embracing technology for technology’s sake, completely OUT of alignment with business needs. Meanwhile, systems were crashing, projects delayed, etc.  This CTO somehow thought he was being strategic and business-oriented, but he actually was just being plain clueless, and more tech-focused than ever.

With IT’s background and history, the push towards IT/business alignment is ongoing and needs to be continual, rather than dismissed as something we’ve now evolved beyond. Even more, alignment mustn’t be deprecated as somehow beneath the higher goal of strategy. It’s not an either/or, and it most certainly doesn’t happen through mere declaration. And openly striving for alignment with our peers is nothing that anyone should present as a taboo or a sign of weakness. Additionally, at the same time that we serve as service providers to the company, we can and must be strategic in our outlook. This shouldn’t be either a surprise or controversial; in fact, excellence in tactical delivery is the ante that gets you to the strategic table.

It’s taken decades to get where we are—and I’d say (given, for example, the anecdote I cite above) that most of us are not really there yet anyway. Let’s not risk reinstating the “ivory tower” of strategy, devoid of the reality that comes from grappling with the actual pragmatics of implementation.

So, here are MY three tips on how to help convert your CEO’s understanding of where IT fits into the bigger picture. You’ll notice the emphasis of these points is quite different from the similar list in the piece I’m responding to here: in particular, my points stress a healthy balance between strategy and tactics, technology and business.

  • Make sure there’s a rock-solid prioritization mechanism for all projects, where the priorities are clearly set, the tradeoffs carefully examined, and tough choices explicitly made and regularly revisited by the group of senior management, including the senior technology executive, who are jointly responsible for the business success of the company.  Focus on IT governance, Project Portfolio Management, etc.
  • Speak up visibly and strongly to ensure that “roof projects” are given appropriate attention and priority. Build for the day after tomorrow rather than just for tomorrow. You in IT are a key advocate for this sort of basic corporate responsibility; you have and need to exercise your equal seat at the table.  And don’t let a misguidedly monomaniacal focus on strategy derail your obligation to keep the trains running on time. Nothing undermines the case for IT to be viewed as having a greater strategic role more than if the company is experiencing ongoing crises in basic delivery and systems.
  • Be the straw that stirs the drink. IT, given a leader with appropriate vision and perspective, can and should be a natural cross-functional leader in the enterprise, both initiating business innovation AND espousing tactical responsibility.  They go hand in hand.

Let me end by quoting my colleague Steve Romero, who wrote, “Recognize that the “achievement” of alignment does not mean you’re done. This is where the “journey” analogy comes in. Think of IT-Business Alignment as “getting your head above water.” Once you reach the surface, you are not done. You need to keep treading water or you sink again. IT-Business Alignment is something that must be maintained as opposed to achieved.

Lagniappe:

Comments

  1. Peter, this is great, thanks for a terrific discussion of the issues. Speaking from “the business side” I think that one of the key things we can and must do is be willing to learn more about IT. The problem I frequently see goes beyond the language barriers; business folks are intimidated or are simply embarrassed to say to their IT partner: “I don’t understand what you’re talking about, please explain it”. The lack of back and forth learning is what leads to the perceived arrogance you mention, and worse, the inability for anybody to call “BS!” on someone in IT if needed. Thanks again for the good food for thought.

  2. Definitely speaks to how a good IT department has “a finger in every slice of the pie” so to speak. Building a solid strategy that truly aligns with the business, driving those initiatives is fundamental to IT success (I wrote about that topic here: http://bit.ly/dhZtkQ).

    Well written, keep it up. I’ll be back for more!

    Matthew Schmitt
    http://matthew-schmitt.com
    http://twitter.com/matt_schmitt/

  3. Peter,

    Nice job summarizing (among other things) and interesting set of Twitter conversations on “the business” and IT. This distinction is so silly – do we talk about “the business” and HR? – but a reality because of the mystery that IT represents to many in other functions. Just ask someone with a business degree about their single “programming” class – if they even require it anymore.

    As we discussed a few weeks ago, the Weill/Ross book IT Savvy does a great job of discussing the business/IT alignment issues from a “business” or dare I say, neutral perspective.

    I agree that prioritization is a top, if not the top, aligning capability that if done right, drives alignment explicitly. It is, however, something that few companies do consistently well. It usually takes a large investment to drive a detailed prioritization discussion of the functionality, waves and phases. The medium and smaller investments often go where the wheel squeaks the loudest.

    On the flip side, I think that governance is often misused as an alignment generator. Instead, a core work process like prioritization is a much better way. A complete system would also include aligned processes like enterprise architecture planning, and multi-year roadmapping.

    Thanks again for an on-point and practical (as always) article.

    -Chris
    CIO Dashboard

    PS. As I was getting ready to “Submit” I saw the latest Tweet from Matt Watson, CIO/CTO of VinSolutions. Check it out – he’s the first listed: CIO Twitter Dashboard

  4. Chris,

    Interesting perspective, but when HR is viewed as a compliance role, I indeed hear people commenting on “the business” and HR. Any barrier to the pure goal achievement and execution by “the business” has the potential to be fill the “the business and ” connotation. If IT provides any slowdown to that pure goal achievement, however ill informed, also runs the risk of filling in the .

    Governance is critical, beyond an alignment generator. Without it, “the business” looks back over the year and struggles to understand why IT allowed “the business” to over spend on what turned out to be whimsical priorities given a lack of true business priority matched against shared resources and competing priorities applied frivolously.

    “IT, you know I was going down the wrong road. Why didn’t you stop me?”

  5. To Sally McKenzie:

    You make a valid point but let’s not downplay the fact that, just as often, it’s the case that IT folks are intimidated or are simply embarrassed to say to their Business partners: “I don’t understand what you’re talking about, please explain it.”

    Learning has to go in both directions because each group has exclusive information that’s critical for ongoing success.

  6. Peter,

    Excellent article that I just stumbled onto. Although now a few years old, the basic issue continues to be present.

    What I did not see in your post is two additional areas that I have personally experienced positive traction on. First is the fair valuation of projects using time-value-money calculations. While many in IT do not have access to the positive impact a project is forcast to have on a line of business (or the negative impact if a service were to be discontinued), they can and should have these numbers available to them, especially if a CIO/CTO is looking to sit at the strategic table.

    Second, tied closely to the first, is project tracking through the full lifecycle. IT projects should not end with the transition to a Business-as-Usual state, but instead should track the project and its impact on the company through the full life of the technology until retirement/replacement. In this way IT can build a track record of the strategic value-add it provides to the company.

    Best,
    Tim Foley

  7. Thanks for commenting, Tim. Excellent points, both. I’ve written elsewhere, at fairly great length, about project valuation, which is a great interest of mine. See my series on Financial Metrics For IT, starting here.

    And the idea of tracking projects after launch? It’s absolutely critical, and a custom much more honored in the breach than the observance. I completely agree with your point, in other words.

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