Alignment: The Business of IT Is Business
Aligning IT with the business is not at all about "managing expectations."
CIO — Many IT professionals believe that alignment with the business is all about managing expectations. But the phrase "managing expectations" is ridiculous and should be stricken from CIOs’ lexicons. It conveys false hopes that, through artful maneuvering, delivering less is OK. Nothing but food satisfies hunger, nothing but money pays the rent, and nothing but a "yes" satisfies IT’s business partners.
Smart CIOs improve alignment by figuring out how to say yes in a way that works for both the business and IT. Overall, business-IT alignment has progressed during the past five years, due to the institution of executive committees, rigorous priority-setting, active portfolio management, "skin in the game" accountabilities, standardized technology and processes, strategic sourcing and better customer relationship management.
In spite of the improvements, alignment continues to top executive surveys as a critical initiative. CIO magazine’s "State of the CIO" research shows that alignment remains the top management priority for CIOs. At a recent breakfast for CIOs that I facilitated, participants shared stories that highlighted the persistent barriers to alignment. They discussed strategic plans that aren’t actionable, the challenge of working with decentralized business units, project justifications that put form over substance, funding decisions that are designed to keep the peace, constant pressure on noncapital IT costs, the difficulty of staying the course with technology plans and the leadership gap between CIOs and their direct reports.
This discussion highlighted the multifaceted complexity of the alignment problem, which encompasses the domains of strategy, governance, technology and organizational structure. To tackle alignment, CIOs must first accept the fact that IT’s business counterparts will always want more for less, without delay. CIOs need to learn how to balance the limited supply of IT services with the seemingly infinite demand in a way that is acceptable to the business. This is done through strategy and governance practices that force the business to acknowledge limits and say no to themselves. IT capacity constraints (which are more often people-based than money-based) can be relieved by designing technologies and organizations that "flex" as business volume and project demands ebb and flow.
There are six promising concepts to help CIOs face the challenge of improving alignment. I will briefly review them here and will discuss them in more detail in my next three columns.
1. Real-world strategy. Business strategy is usually informal, and it changes frequently as new learning occurs. CIOs need an ongoing, participative process for deriving business strategy and weaving IT strategy within it.
