How to Change the Corporate Mindset Towards IT - Page 1

Nov 15, 2011

CIOUpdate Contributor

by Derek Lonsdale, Nilesh Chandra and Chris Gallacher of PA Consulting -

The IT function exists to support the business in achieving competitive advantage. However, many business users often see IT merely as a barrier to their initiatives; a function that over-spends and under-delivers. In order to foster a better relationship with the business, IT must strive to change the corporate mindset and demonstrate that it can be a reliable technology partner for the business.

In this article, we argue that a common engagement model can be valuable and we explore practical ideas by which IT can improve its relationship with the business exploring different strategies that apply to different stages of a service lifecycle from strategy to implementation and delivery.

The IT function exists to support the business. Business and IT leaders recognize this and thus continue to make investments in the IT organization and infrastructure. However, this view of IT as a strategic asset changes as you move down the organization chart.

To most business users, IT is often a barrier rather than an enabler. IT is perceived as the organization that says “no” to innovative ideas -- the organization that over-promises and under-delivers. Much of this criticism is unfair and arises from a lack of appreciation of the complexity of technology implementation and day-to-day management. However, there is also some truth to this criticism. In every organization there are plenty of examples of delayed projects, unrealized benefits and technology that simply doesn’t address user needs.

If IT is to have an improved relationship with the business and it has to be perceived as a trusted technology partner to the business. IT leaders must work hard to address these concerns by fostering a consistent and intuitive engagement model between IT and the business with clearly defined roles and responsibilities, clearly agreed strategy and scope, and strict adherence to priorities and timelines. In the rest of this article, we apply some of these strategies to a standard service lifecycle.

Strategy - Understand the business strategy and ensure IT is aligned to support it.

In our experience, the high level details of a business strategy are well known in most organizations. However, IT often lacks a detailed understanding and appreciation of the business’ expectation from IT to support the execution of the strategy. This happens because IT is seldom engaged by the business during the development of the strategy. Instead, the business groups develop a strategy and then hands it off for “implementation” to IT. As IT begins to implement solutions, the rationale behind the strategy is not well understood and thus incorrect assumptions are made. This undermines the very strategy that IT was asked to support.

Learning point: Engagement at the strategy level must include all relevant business and IT stakeholders

Design - Involve the business during design decisions.

This is much easier said than done since most business users assume that design is a technical activity where they have little to contribute. However, in our experience, the single biggest cause of failure of any IT initiative is flawed design decisions.

One way to involve the business in design is by removing technical jargon from discussions and talking about design decisions from the business point of view. Not only does this ensure that business stakeholders can contribute to the discussion, it also helps IT get a better understanding of the business they support.

Getting the IT organization and the business to talk a common language can help bridge the historical divide between business and IT and go a long way in changing the corporate mindset towards IT. Business users often have very clear ideas of the solutions and services they want, but do not appreciate the technical complexity involved or the costs of delivering their requirements. This causes numerous instances of “sticker-shock” as well as the common refrain “Our IT organization is so expensive, we could get external contractors to come in for half the cost”, or “The solution vendor said this would only cost half of what IT is saying."

In both cases, the most common reason is a lack of understanding of the solution’s total cost of ownership (TCO). By closely involving the business in design decisions, IT can help them better understand the complexity of a technology and TCO associated with any solution or service. Implementing a gated approach to projects can help ensure the right information is prepared and reviewed at the right time. This can avoid the common “throw it over the fence” approach whereby the operations team are left picking up the pieces in order to provide a sustainable service.

While IT needs to refrain from using complicated jargon when describing the solution and they also need to describe value in business terms and metrics, e.g., the output of a payroll service is number of payees/pay checks issued rather than 99.99% server availability.  In contrast, the business needs to understand that IT should be considering the availability, capacity, continuity and security requirements of the solution as well as the utility or functionality required and these requirements can drive up TCO.

Learning Point: Time and effort spent engaging at the design phase will pay dividends by reducing costly errors that may only be identified after solution build and test.

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Tags: IT Leadership, IT strategy, PA Consulting Group, CIO credibility,

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