Moving IT Up the Value Chain

By Anne Zink

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When you sit back and think about it, IT/business alignment is a ridiculous statement. Not that it isn’t true, it’s that it is so obvious. Who could ever disagree? Why have we been obsessed with this topic for over a decade?!?

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Over the last two years we’ve interviewed over 300 CIOs, their direct reports and their customers (both internal and external). We’ve found the problem isn’t lack of alignment, it is a lack of relationships.

“We’re totally aligned … in PowerPoint,” said the CMO of a pharmaceutical company.

“It’s not a disconnect between business objectives,” shared an SVP of emerging markets for a financial services company, “it’s a lack of connection between people.”

When we shared these comments with the CIOs, their sigh was deafening. “I have to be honest, comments like that make me feel like it will never be enough. I am only one man.”

Therein lies the problem. In our research we found almost 60% of CIOs feel the role of aligning IT and business objectives sits squarely, and solely, in their lap. A full 68% of IT directors and managers felt isolated from the rest of the business.

On the flip side, over 70% of non-IT executives felt they had little to no insight into the workings of IT and 65% felt that while IT was marching to the same strategic order, the cadence was a completely different pace.

“Honestly? We can check the IT aligned with business strategy box. But alignment does not always equal supportive. I know the lack of integration of my people into the business is a problem. We may be aligned, but we aren’t necessarily making life easy,” said a Fortune 100 CIO of a petroleum refining company.

“Let’s just put it on the table. IT is the pariah of the organization at the worker level,” vented another IT manager. “At the C-level everyone is great friends. Down here, where the work gets done, we are in the midst of a Cold War.”

Fortunately, a state of détente has been achieved by several of the companies we interviewed. For them, peace lay in changing the perception of IT. These CIOs set out to move their entire organization up the value chain. Evolving it from a roadblock to a facilitator.

These CIOs stressed, there is no magic bullet. The personalities, available resources, and overall savviness of the functional groups greatly impact success.

Looking across about 70 companies who have managed to not only align IT and business objectives, but IT and business people, several leading practices emerge:

Holistic Skill Building of IT Staff - These CIOs looked hard at the skill sets of their team beyond the requirements of IT.

They actively worked to lower the "geek factor” by adding generalists to their staffs. They spent time explaining the non-IT aspects of the corporate strategy. They connect the dots between tactical IT initiatives and strategic competitive differentiation. They invested in developing communication skills.

Assign IT Liaisons to Functional Groups - Instead of waiting for new projects or requirements to filter down to IT, these CIOs assign each functional group (e.g., HR, sales, marketing, finance) an IT liaison.

This liaison proactively works with the department to develop and refine IT requirements. More importantly, the liaison learns how their “customer” does business. They come to understand the daily pressure of their peers and how they are measured. They gain first hand knowledge of how IT impacts the function on a day to day basis.

Link Internal & External Providers & Customers - Today’s IT environment is a mashup of insourcing, outsourcing and co-sourcing. There is an ecosystem of internal constituents, service providers, alliances, suppliers, partners and end customers.

Our leading CIOs recognize this complexity requires greater attention to teaming both in terms of facilitating good teaming and oversight/governance. They create stakeholder councils chaired by their staff to insure all parties are grounded in the strategy they are supporting and that their objectives remain on target.

Aligning Compensation & Recognition Structures - These CIOs shift a portion of their staff’s compensation structures to reward for the satisfaction of users. A IT team must have a stake in the success of the rest of the company. They can’t puff out their chests for achieving SLAs if customer satisfaction plummeted due to changes we made to the online ordering system.

In the end, moving IT up the corporate value chain is about expanding the presence of IT beyond that of the CIO. It’s about people connecting with people. After all, people cannot value what they do not understand.

Anne Zink is founder of AZtech Strategies and go-to-market strategy consultant for the high tech industry. AZtech is dedicated to developing multi-channel strategies based on customer expectations, channel input, and industry expertise. AZtech specializes in bringing emerging technologies and services to market.