Proper Alignment with Technology Is Critical in Achieving Strategic Objectives
By David Mustin, Vice President of Strategic Consulting, Marcum Technology
A client recently approached Marcum Technology with an important question: “Are we getting value from our IT organization?” As he explained it, IT was becoming far more technical and losing its connectivity to the business. IT didn’t understand the needs of the end-users except through the boxes and wires, and they were losing all relationship to the business’s objectives. The client felt like he was missing a golden opportunity to grow the business, and he needed IT to help him get there.
This is a common complaint from senior business leaders. “IT has become commoditized.” “It is more about technology than running the business.” “There is a wide gap opening between what my IT organization does and what we need them to do.”
There are three common drivers that affect all organizations and are causing this disconnect:
- The rise of “do it all” ERP systems has effectively turned the business-side operations of IT over to large enterprise system vendors. While this has created exceptionally good applications to support the running of the business, it has reduced the need for business-centric IT leaders and analysts.
- Even before the pandemic, there was an increasing desire to be able to access information from anywhere. This was driven by flexible work-from-home arrangements, staff mobility and the rise of tablets and cell phones. This drove the need for stronger technical resources that could develop and support the robust infrastructure and the increasing technical requirements of that environment. The need to support an elastic workforce accelerated a migration to the cloud and hybrid clouds, where some solutions are on-premise and some in the cloud. Both scenarios have, again, led to more flexibility and better operational systems, but often with less individual talent that can focus on building and transforming the business.
- The prevalence of ransomware, cyber security attacks, phishing attacks and other cyber security issues have driven IT organizations into a bunker mentality of trying to protect against unknown threats to the exclusion of all else, until it’s too late. This is a perpetual effort that has become resource-intensive and all-consuming, to say the least. It unfortunately has the effect of taking IT’s eyes off the prize, which is the ability IT should have to help drive business success.
These three factors have driven a fundamental shift of IT as an “opportunity” to address business objectives, create competitive advantage and transform into a leaner, more agile, more innovative organization, into IT as a highly technical resource focused on keeping the organization safe and the lights on.
Business leaders who are seeking to develop an IT environment that supports growing and accelerating their businesses can take concrete steps to course correct. These changes take time, but they lay the foundation for organizations to digitally transform not just the IT organization, but the entire enterprise, enabling teams to think, act and lead differently.
Critical steps leaders should take to develop a business-aligned IT organization include the following:
- Hire an IT leader or IT partner with a solid business foundation and who understands the industry the organization is operating within. Business drivers, objectives, processes, and metrics all vary by industry. Your IT leader should have a thorough knowledge of those fundamentals. A qualified IT leader should also have a seat at the executive table to be a part of strategic discussions and to engage with other leaders on their needs and how technology can support the business objectives.
- Develop a strategic IT roadmap that directly connects to the business objectives. Businesses typically have 3-5 business objectives for the next 12 – 24 months. The business-focused IT leader needs to provide a clear link between IT capabilities and business objectives. This will likely require investment in IT capabilities, but the investment, and return on investment, should clearly be spelled out in the IT strategic roadmap and at a high level in the business plan.
- Acquire and develop business analysts in the IT organization who can speak the business leader’s language. They should be able to set aside tech-speak and speak to revenue, margin, business processes and the metrics that are meaningful to the business leaders. They should have a seat at the table whenever meaningful business unit discussions are being held and especially when business plans are being developed. These individuals become the bridge between the business units and IT and function as advocates for the business in all internal IT discussions.
- Embed business metrics in IT dashboards and IT projects. Focus on delivering business impacts and results, not just projects on time and under budget. Other than purely technical system refreshes, if a project can’t define the business impact, then should it be done?
Outside factors have driven IT towards a very technical orientation to the detriment of both IT and the business. In many organizations, IT leaders have lost (or never found) a seat at the table. However, with the rising need of increased and accelerated business impact, there is no better time for IT to establish its role in driving growth and a transformation of the business.