What does Business-IT Alignment mean today?
Business-IT Alignment is integral to organisational success.
We exist in ‘digital’ times. Most of us lead substantial parts of our lives, both professional and personal, engaged in digital landscapes. We leverage social channels such as LinkedIn to professionally network. We leverage Facebook to stay in touch with friends and loved ones. We watch YouTube for leisure or business. We surf the web for a variety of reasons. We engage in online gaming. We book professional conferences leveraging a wide number of digital resources. Equally, we book private travel and dining using online resources. In the morning we are using Zoom of GoToMeeting to professionally meet those at a geographical distance and in the evening, we use WhatsApp or Viber to do the same with loved ones in different time zones.
You get my gist. Significant component of human life is now spent in digital landscapes.
To reside in a digital world, people have embraced digital habits; professional and personal. So too, to effectively compete in the digital world, businesses must embrace digital practices. And to be an effective digital entity, the business must be powered by the underlying IT function. Most successful businesses today are a digital business. A business can either be manacled by the underlying IT function or liberated and empowered by it. The degree and extent of alignment between business and IT has a causal impact on organisational success today. Increasingly, IT has a unique opportunity to advise and enable business in the digital age. Also, far from having to labour in relative obscurity behind the scenes in the organisation, CIOs are incrementally important in today’s data-driven world.
This novel paradigm, which places significant emphasis on the business value of IT, is in marked contrast to the situation not long ago, when Business-IT Alignment was not quite as crucial. It was more of a check box activity.
Business was traditionally more siloed than it is today. There were impermeable walls that separated one function from another, diminishing collaboration. Also, the link between a functional unit and the overall business goal was not as cohesive as was required. In the same vein, when it came to ‘business’ and ‘the IT function’, there were distinct divisions. With business on one side of the fence and IT on the other. IT resided in a silo, with little to no direct causality to improve the business’ bottom-line. The language IT used to converse with the business was IT-centric. The business required business-centric language. The difference in language, the lack of link between the two and operational silos led to Business-IT misalignment.
For business’ to compete effectively in the digital era, IT and core business must be highly aligned, for which, they must converse in the same language. The communication barriers between IT and the business for decades, has earned the IT function some interesting nicknames! Humour aside, when the business becomes jaded with IT’s activity or lack thereof, or with the lack of alignment from the IT function, the scene becomes more tense and complicated. IT finds itself pushing harder to enforce necessary tactics, such as information security. Business users increasingly find ways to bypass and override IT rather than working collaboratively. Contrariwise, when the business does call on IT for support, IT’s approach to the business is not one of collaboration, and it is unlikely that IT will provide a high standard of service to uncollaborative business users.
Add to the above quagmire, management egos, company politics and the protection of turf, and it is little wonder that Business-IT Alignment has, until relatively recently, been little more than a pipe dream.
Even more telling has been the problem of business culture, which over the years has tended to regard IT Leaders as glorified technology professionals or, in best case scenarios, managers of standard IT services such as network servers, telephones, email and the like. These are all necessary for the daily running of the business and are cost centres. The business value of IT went mostly unrecognised and unexploited by senior management.
Strategic Alignment of IT and Business has become a reality
More recently, however, the headlong dash by businesses all over the world, to embrace all things digital – be it for e-commerce portals, big data analytics, revolutionising the supply chain, or other strategic use cases – has brought IT to the fore.
Now, the function of IT is integral to most businesses and, for many organisations, it is a source of competitive advantage. In some instances – think Amazon, Uber or Airbnb – IT excellence and innovation is the basis of the entire business model!
IT is now a significant business enabler and is challenging the way that companies organise processes, communicate with customers, and deliver their services. Business-IT Alignment is vital, not only for market impact and growth, but also for a business’ survival.
Since it is now a “significant business enabler”, IT is no longer relegated to the back seat in the cafeteria and next to the washrooms. Instead, IT is rubbing shoulders with sales, marketing, purchasing, production, R&D, finance etc, in the corner office and around the boardroom table. The CIO is no longer excluded from strategy sessions and is a crucial member of the leadership team.
The role of the CIO has evolved more than most other executive positions. Previously, the CIO’s function was to implement the technology that business leadership requested. The CIO rarely, if ever, participated in helping develop the business strategy. Now, organisations require more technology related-leadership and advice to help drive the strategic decision-making process. The age of Business-IT Alignment is truly upon us!
How can organisations achieve Business-IT Alignment
Internal politics and silos can delay or derail any alignment effort. Employing the services of an external expert can assist in bringing objectivity to the process. An expert can also identify areas where specific functions can be outsourced to free up IT talent to focus on strategic business initiatives, rather than the never-ending management of basic utilities. An example would be using an external service provider to manage email systems.
A lack of internal communication is said to be one of the biggest stumbling blocks to successful Business-IT Alignment. Communication must be made a priority within the organisation to resolve this stumbling block. Job-shadowing between personnel from IT and the other parts of the business is one way to achieve this goal.
Different viewpoints result in communication problems. Business users focus on achieving the business results, while IT focuses on technology. This problem can be exacerbated by the two sometimes being in different premises, or even in different cities or countries.
In seeking to achieve Business-IT Alignment and break down the existing silos, it is useful for IT to demonstrate its worth to the rest of the business and show that it is capable of being more than a cost centre and the custodian of standard technology infrastructure.
Instead, led by its newly empowered and now strategically well-informed CIO, the IT department should be developing value-added services that open up new areas of business opportunity, create innovative solutions to business problems, and generally support the strategic direction of the business, as articulated by the board and top management team. The goal of having one team allows for only one strategic direction.
Business alignment doesn’t mean always agreeing with the business, but for the CIO it does mean supporting its strategies and the directions in which it is heading. IT should work towards achieving business-related metrics, not just IT metrics. The focus must always be on improving alignment.
Alternatively, IT could strive to achieve an even loftier goal than Business-IT Alignment? “Convergence”, for example, may be more appropriate as it means moving toward union or uniformity, with both entities striving to be one unit. Alignment, on the other hand, implies that two separate entities are trying to work together but remaining distinct.
Could it be that Business-IT Convergence is the new buzz phrase on the horizon?
Experteq specialises in strategic modernisation and transformation of the workplace. If you would like to learn more about how you can modernise your workplace through the alignment of business and IT, contact us today.