Tear down that wall...

Posted by: Mike Rollings

This MIT Sloan Management Review article “How to Tap IT’s Hidden Potential” by Amit Basu and Chip Jarnagin, caught our attention today at Burton Group.  The article discusses that many companies fail to recognize the value of IT and that this failing is due to IT being separated from the rest of the business at most companies.

The article states that a blueprint for the demolition of the wall between IT and the business includes the following:

1. Begin with IT literacy and commitment at the top. Honestly, I’d rather see commitment and a willingness to collaborate.  The need to develop IT literacy can be misperceived as “understand it so you don’t have to talk with IT”, where as the willingness to come together, eliminate the language barriers by better understanding both sides is essential. 
2. Hire an IT leader who sees the big picture.  “The best CIO can work within the management culture at the executive level, can present IT issues as business issues to the executive team, and is willing to learn the business as well as technology.” I agree.  I would further point out that while the authors state the risks of being blindsided by competitors when CEOs use obsolete metrics like benchmarking the competition to decide on the role and to evaluate the performance of IT, CIO should realize that managing IT by benchmarks only raises performance to a level of mediocrity.  The IT leader must see the big picture and then set expectations to improve the IT outcomes that achieve that vision.  The measures of performance against goal follow. 
3. Rotate management and executive candidates through IT.  I’m all for IT spending time in the business and gaining a better understanding of their primary customer.  I’m also a believer that IT managers should be able to jump over to the business and vice versa.  But I’m not sure that spending time in the IT department gives someone a better understanding of how technology can be used differently by the business.  Don’t get me wrong, I think it would give people an appreciation for how things happen in IT and the challenges of their IT organization in the delivery of services. I think it would also help identify potential reuse opportunities for solutions used by other business departments.  It might even improve some problems in the delivery of business-aligned services.  But as a means to foster new innovation, I would add time looking at how other organizations, industries and consumers use technology and then spearhead an incubator type prototype.  Executive track participants would then be exposed to the challenges of behavior change and technology adoption. 
4. Create demand for IT solutions. I don’t think we have a demand problem.  In some organizations IT may push technology, but in most it is a misdirected glut of IT project demands that are not aligned with a consistent business direction.  I refer back to my collaboration comments on #1 as my preference for creating a portfolio of business aligned demand. 
5. Make sure nothing gets lost in translation. Wow, do we have a problem here!  IT tends to talk about methodology nomenclature, wires & pipes, and universal references like “architecture”.  Can’t we just remember that people who eat sausage don’t really want to know how it is made?  IT needs to have these discussions, but not in front of the business.  The discussion that needs to happen is agreement on the business operating model, strategies, the identification of supporting processes and information, required connections internally and externally, and the impact of those changes. 
6. Rationalize IT spending. 
7. Create an IT portfolio by evaluating risk and returns.  #6 and #7 together are dead on.  Priorities based on decision-quality information that comes from dependency identification, impact, risk and cost assessment.  The methods associated with identifying these dependencies are related to the enterprise architecture discipline and the outputs used within IT investment governance to facilitate their understanding.

                                                                                                                                 

Shattering the wall and improving IT value takes a concerted effort and involves enterprise architecture and other IT disciplines to hammer away at the problem.  To use a restaurant analogy…

All IT organizations have similar sounding ingredients today (e.g. databases, networks, application servers) and similar sounding IT disciplines (e.g. portfolio management, enterprise architecture, project management, system delivery, operations).  Teaching the business to understand the ingredients or the IT disciplines misses the point.  Sometimes we want a hotdog and other times Steak Diane.  In either case, not understanding what’s desired, not having the right ingredients, or not having the capability to prepare it will result in an unsatisfied customer.  Your end product is only as good as the weakest link.

So, demolishing the wall is just the start to improving IT value delivery.