Business IT alignment is a topic that generates heated debates and outright ridicule sometime. There is a Gartner fellow, who declared, "None of you are in IT, all of you are in business". Then some one else claims why IT is so special, no one talks about aligning Finance and Accounting to business. The general feeling is that, it is a non issue.
I beg to disagree. All of these commentators are missing the point. IT and business need alignment, specifically because IT is not like other support functions of business. IT is not finance, accounting, HR or legal. IT IS special. And why is that so?
It is because IT is not only useful operationally or tactically, but can provide significant strategic and competitive advantages. It is not only useful in automating operations or producing relevant management information but also can add new market segments to business, open up new distribution channels, or sometimes add new lines of business. It is this capacity of IT that should allow IT to go ahead on its own strategic vision. IT going on its own and doing its own thing, is good for business. That unfortunately gives rise to issue of alignment.
Business leaders need to understand making IT just an 'order taker' for business removes any incentive for IT to contribute in this unique way that no other support function can. Enterprise IT function can use the building blocks available in market place to create the differentiators for the business. This unique function can not be totally trusted to a vendor.
This is especially true in case of banking, financial services and insurance sector, where essentially business is nothing without IT (and of course a lot of capital). Most business in this segment derive their USP from IT and must treat it as strategic asset (and most do). So when attempting to align business and IT, don't make IT totally subservient to business. There are multiple perspectives of alignment. IT being sensitive to business strategy is necessary but not sufficient. IT strategy must also respond to external IT world and bring relevant changes into business, whether dictated by business strategy or not. So business leaders need to be even handed and do a 'complete double loop' of alignment so that IT strategy has a chance to make difference to business, and IT is not just taking orders from business.
As business and IT strategies can be at loggerheads at times and that will make alignment difficult. But make no mistake, business IT alignment is required for optimal results and IT strategy need to be given some degree of freedom.
These are my thoughts about various issues faced by an enterprise architect.
Here you will find thoughts related to enterprise architecture, TOGAF, SOA, BPM, MDA, MDD, Web 2.0 etc.
Thursday, June 11, 2009
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Thursday, June 11, 2009
Business IT alignment: Who cares?
Business IT alignment is a topic that generates heated debates and outright ridicule sometime. There is a Gartner fellow, who declared, "None of you are in IT, all of you are in business". Then some one else claims why IT is so special, no one talks about aligning Finance and Accounting to business. The general feeling is that, it is a non issue.
I beg to disagree. All of these commentators are missing the point. IT and business need alignment, specifically because IT is not like other support functions of business. IT is not finance, accounting, HR or legal. IT IS special. And why is that so?
It is because IT is not only useful operationally or tactically, but can provide significant strategic and competitive advantages. It is not only useful in automating operations or producing relevant management information but also can add new market segments to business, open up new distribution channels, or sometimes add new lines of business. It is this capacity of IT that should allow IT to go ahead on its own strategic vision. IT going on its own and doing its own thing, is good for business. That unfortunately gives rise to issue of alignment.
Business leaders need to understand making IT just an 'order taker' for business removes any incentive for IT to contribute in this unique way that no other support function can. Enterprise IT function can use the building blocks available in market place to create the differentiators for the business. This unique function can not be totally trusted to a vendor.
This is especially true in case of banking, financial services and insurance sector, where essentially business is nothing without IT (and of course a lot of capital). Most business in this segment derive their USP from IT and must treat it as strategic asset (and most do). So when attempting to align business and IT, don't make IT totally subservient to business. There are multiple perspectives of alignment. IT being sensitive to business strategy is necessary but not sufficient. IT strategy must also respond to external IT world and bring relevant changes into business, whether dictated by business strategy or not. So business leaders need to be even handed and do a 'complete double loop' of alignment so that IT strategy has a chance to make difference to business, and IT is not just taking orders from business.
As business and IT strategies can be at loggerheads at times and that will make alignment difficult. But make no mistake, business IT alignment is required for optimal results and IT strategy need to be given some degree of freedom.
I beg to disagree. All of these commentators are missing the point. IT and business need alignment, specifically because IT is not like other support functions of business. IT is not finance, accounting, HR or legal. IT IS special. And why is that so?
It is because IT is not only useful operationally or tactically, but can provide significant strategic and competitive advantages. It is not only useful in automating operations or producing relevant management information but also can add new market segments to business, open up new distribution channels, or sometimes add new lines of business. It is this capacity of IT that should allow IT to go ahead on its own strategic vision. IT going on its own and doing its own thing, is good for business. That unfortunately gives rise to issue of alignment.
Business leaders need to understand making IT just an 'order taker' for business removes any incentive for IT to contribute in this unique way that no other support function can. Enterprise IT function can use the building blocks available in market place to create the differentiators for the business. This unique function can not be totally trusted to a vendor.
This is especially true in case of banking, financial services and insurance sector, where essentially business is nothing without IT (and of course a lot of capital). Most business in this segment derive their USP from IT and must treat it as strategic asset (and most do). So when attempting to align business and IT, don't make IT totally subservient to business. There are multiple perspectives of alignment. IT being sensitive to business strategy is necessary but not sufficient. IT strategy must also respond to external IT world and bring relevant changes into business, whether dictated by business strategy or not. So business leaders need to be even handed and do a 'complete double loop' of alignment so that IT strategy has a chance to make difference to business, and IT is not just taking orders from business.
As business and IT strategies can be at loggerheads at times and that will make alignment difficult. But make no mistake, business IT alignment is required for optimal results and IT strategy need to be given some degree of freedom.
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