Fri, June 29, 2007 — CIO — Most major organizations claim to have a service-oriented architecture (SOA) plan. Not to have one would be oldfashioned. However, successful implementation of end-to-end data and business processes integration requires not only a technology architecture but also a parallel business architecture. You simply can't have a modern business model without modern processes, software and infrastructure that are tightly integrated.

But in most enterprises, this integration between IT architecture and the business model remains poorly articulated. I call this the CEO/CIO dialogue gap. This gap exists to some extent because of the relative "newness" of IT as a discipline. Professions like finance and manufacturing have matured over hundreds of years, with principles, structures and a body of knowledge that are well understood by business leaders. However, IT has been part of the commercial landscape for only four decades.

During the last 10 years, some CEOs and CIOs have been able to close the dialogue gap. However, in today's flatter—even upside down—world, competition is much harder and business moves much faster. In such exhilarating and dangerous times, strong leadership really matters. There's no longer any room for miscommunication between the business and IT.

Critical Alignment
The struggle for business/IT alignment is decades old. But today, the stakes are much higher because technology is becoming fully integrated into every facet of customer, supplier and employee interactions. The challenge for CIOs is multifaceted. First, they must grasp the competitive business context of their enterprise and understand the durable processes that drive the business versus organization structures that are perishable. Then they must be able to build a realistic multiyear modernization plan for the enterprise and establish process, data and investment governance structures with the executive team. Finally, CIOs must be able to articulate the value of the above to their business constituents continuously and with passion.

This is a tall order, but it's critical for the success of a modern enterprise. In the past, we could get away with short-term commitments and much less discipline because we were funding and executing projects that were contained within a business function and limited to a specific technology. But in our current era, most business processes require real-time integration of data and applications. If the business and IT integration model and investment strategy are not well-understood, aligned and managed over multiple years, you could end up with poor business results, dissatisfied customers and out-of-control IT expenses.