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The ROI of Alignment

January 01, 2007 — CIO —

Simply put, if you match what you are doing in the IT department to the goals of your business—whether it be growth, building brand loyalty or entering new markets—you will, most assuredly, increase your chances for success as a CIO. Period.

How do we know? Because the results of this year’s "State of the CIO" survey couldn’t be more clear: Alignment brings the money.

CIOs who said they were aligned with the business reported that IT had enabled a new revenue stream more than twice as often as those CIOs who said they were not aligned (24 percent versus 11 percent). More important, more aligned CIOs said they had used IT to create a competitive advantage for the company than unaligned CIOs (38 percent versus 23 percent).

So how do you achieve this exalted state? Alignment is a skill that is less technical than it is social. How well an organization has aligned IT processes with the business strategy depends on "how well the CIO is communicating with C-level colleagues," says Laurie Orlov, vice president and director of research for Forrester. "They need to be able to fully communicate what IT is doing and why that is important to the business strategy."

But the sad fact is that few CIOs are aligned. Only one out of five CIOs said he’s aligned with his business’s strategic goals, according to "The State of the CIO 2007" survey. That’s a big problem for the other four out of five CIOs, says Albert Segars, a technology management professor at the University of North Carolina’s Kenan-Flagler Business School. If you’re not aligned, "you’re lost in space," he says.

Be All Business

Alignment is not easy to achieve, but there are some ways to increase the odds. For Bill Crowell, CIO of Oregon’s Department of Human Services, it’s being able to talk in business terms, which is much easier to do if you have experience in business. Crowell says his education and background are what have given him the understanding of, and empathy for, the pressures and demands facing business unit leaders. Crowell has an economics degree and an MBA from the University of Virginia. He learned the mind-set of CFOs when he worked for four years as CFO for a division of McGraw-Hill and as assistant deputy secretary of financial systems for the U.S. Treasury Department. This experience, and his ability to speak the language of his colleagues’ business units, enabled Crowell to learn from his peers what resources they needed to meet their strategic goals and missions. "The business management group really didn’t have a sense of where they were and where they needed to get to," he says. "They were looking for help, and I was able to provide some. I can’t say how important that was for me to establish credibility."

 

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