Archive for the ‘alignment’ Category

Hey IT – Forget ITIL, Say Hello To BDIM!

Wednesday, April 8th, 2009

There's A New IT Management Process In Town - BDIM

There's A New IT Management Process In Town - BDIM

The world of IT is changing once again, are you ready? We have evolved a great deal in the last thirty years and it looks like we’re getting ready to make another great leap forward. This time around we have a name for what’s going to happen and it’s called business-driven IT management (BDIM)!

Antão Moura and Claudio Bartolini have been looking at how IT is managed and they’ve discovered that we’re getting ready for another change. Back at the end of the 1980′s IT management was all about tracking boxes and routers. This was the era of IT infrastructure management.

Stability and control were the key drivers behind this effort. IT acted as a technology provider – IT folks were technical experts and their goal was to minimize down time.

In the past few years this style of IT management has changed. Now IT looks less at the infrastructure and more at the end user. IT now practices what is called IT Service Management (ITSM). The thinking is that IT services use groups of IT infrastructure components to help corporate users (and customers) to do business with the firm.

Viewed this way, IT has become a service provider. The downfall of this is that IT is still viewed as being separate from the rest of the business. The rest of the business believes that IT is mainly concerned with expense control. This has caused one of the firm’s greatest concerns to become the issue of business-IT alignment.

We’ve come up with a whole bunch of technical ways to keep track of how the IT infrastructure is performing in order to ensure that our services are meeting their performance levels. These tools include quality of service (QoS), service level agreements (SLAs), and when you combine both of these you get service level objectives (SLOs).

The arrival of the IT Infrastructure Library (ITIL) set of best practice standards has provided a way to deliver IT governance which seeks to ensure that IT risks are mitigated, IT is aligned with the rest of the firm, and that the expected results are achieved.

The problem with all of this is that the best practices, such as ITIL, are very useful, but they just don’t go far enough toward providing concrete solutions.

This has led to the creation of the business-driven IT management (BDIM) approach to IT management. The goal of BDIM is to move IT one step further and start to use a full business perspective to mange IT. This means that we would need to stop using technical metrics measured at the IT level.

This can get a bit difficult to grasp, so here are a few IT management questions posed in BDIM format:

  • Of all the IT incidents that are occurring RIGHT NOW, which is impacting the business the most and thus should be worked on now?
  • Which services should we invest in to improve business results?
  • How many standby servers should we have for our e-commerce site?

Since I know some you may still be struggling, here is a formal definition of BDIM:

“BDIM is the application of a set of models, practices, techniques, and tools to map and to quantitatively evaluate interdependencies between business performance and IT solutions – and using the quantified evaluation – to improve the IT  solutions’ quality of service and related business results”

BDIM is still in the development stages. Models have to be created, how it related to the ITIL processes will have to be worked out, and creating BDIM decision support related tools will have to be done. However, yet another IT management change is almost upon us – and it’s name is BDIM.

Does your IT shop still use the IT infrastructure management approach or have you moved on to the IT Service Management approach? Is your IT shop seen as separate from the rest of the business or do you think that you’ve achieved business alignment? Leave me a comment and let me know what you are thinking.

Do You Have An IT Dictionary?

Monday, March 30th, 2009
IT Departments Need To Create A Dictionary So Everyone Can Speak The Same Language

IT Departments Need To Create A Dictionary So Everyone Can Speak The Same Language

In IT we often get accused of willy-nilly making up new acronyms on the fly. In all honesty, yes we do do this sometimes. However, there is a more subtle word problem that has been creeping around the edges of IT for a long time that nobody’s been brave enough to bring up: we have no idea what we are saying.

Ranjay Gulati, James Oldroyd, and Phanish Puranam are three researchers who have been studying this problem and they’ve made some interesting discoveries. Specifically, they’ve discovered that we all seem to THINK that we are talking about the same thing when in many cases we really aren’t.

In most companies the IT department serves multiple business units or departments. In order to meet the needs of those internal customers, the IT department is always creating new and different ways to present the information that has been collected. However, since nobody talks to anyone else in the company, we’ve been creating a million different ways to present (and talk about) the same data.

What’s been missing from IT’s output is some sort of dictionary. We need to standardize how we talk about the company’s data and how we describe the results of the processing that we do on that data.

Over at Best Buy, Robert Willett who is their CIO said that when he first showed up they 400 to 500 different ways to measure things. What this meant is that measurements done for one customer could not be interpreted by another customer so they had to do the processing all over again.

Robert spent over 10 months and drove to a point where they had single definitions for everything. It was only after this type of IT dictionary had been created that Best Buy started to get some value for all of its efforts.

Does your IT shop have a single set of definitions for the information that you collect and the results that you produce? Have you ever had a situation where two individuals or departments were trying to compare two things but couldn’t because they didn’t use the same words? How have you tried to solve this problem? Leave me a comment and let me know what you are thinking.

How IT Can Help Uncover New Products

Monday, March 23rd, 2009

IT Departments Have The Data Needed To Uncover New Products

IT Departments Have The Data Needed To Uncover New Products

“Alignment”, “Innovation” – arrgh! Who in the world of IT is not sick of hearing these two words used over and over again? Yes we’d like to be able to help out the rest of the business, but our IT budgets are being slashed left and right. We don’t have either the staff or the budget to launch a big new program to collect whatever data is needed in order to tell the company which direction it should go in. Or do we?

It is in the nature of any IT department to collect data on our customers. We already have disk pack after disk pack of historical data about everyone who ever showed even the slightest interest in one of our company’s offerings let alone how much information we have on our existing customers.

In that data lies the secret to how IT departments can help the rest of the company uncover new products. Ranjay Gulati, James Oldroyd, and Phanish Puranam are three researchers who have been studying this problem and they’ve made some interesting discoveries.

Harrah’s is an owner of several casinos. Their IT department has historically collected reams of data on their customers in order to support targeted direct mail campaigns and attempts to increase customer loyalty.

However, it was not until the IT department took a closer look at the data that they had already captured about their big spenders (“whales” in casino speak) that they realized that they had the answers that they needed in order to redesign their casinos in order to position games where they would get these customers to play even more.

The Royal Bank of Canada faced a problem – its consumer credit division  needed to have more customers. The IT department went back and took a look at the credit card applications that they had rejected in the past. What they discovered is that many of these people had improved their credit scores since being rejected. This gave the bank a great set of potential card holders to go after.

Clearly all IT departments are sitting on more customer data than anyone ever believed. Now we just have to figure out how to make that data work for us. It turns out that there are three principles that provide the core for doing this correctly. We’ll talk about them next time…

Does your IT department store enough information on your customers? Have you ever gone back and tried to put that data to use? Were you successful? Leave me a comment and let me know what you are thinking.

Alignment 101: How To Do It

Monday, March 16th, 2009
alignment_m_m3

Knowing How To Align IT And The Business Is The Key To Success

Achieving alignment between the business side of the house and IT is one of those things that everyone likes to talk about when they are putting together the goals for the upcoming year, and then nothing ever seems to get done about it.

A survey that was done by the consulting firm Bain & Co. may contain the reason why we never seem to make any progress on this: we’ve been trying to do the wrong thing. The Bain crew believes that IT departments must first become efficient, and then worry about becoming aligned with the business.

Now the trick here is that you can’t just do one at a time. Karenann Terrell who is that CIO over at Baxter International says that “There is a complexity to doing both, but that’s the job.” Her point is that you can’t wait to become 100% efficient before you start to work on the alignment thing.

Let’s say that you get the efficiently thing up to a point where it’s good enough, what then? Too often CIOs view alignment as being a situation where IT stands ready to do the bidding of whatever the rest of the business needs. That’s not what the business wants. Instead, the business needs IT to participate in the strategic decision making process – help do the thinking for the rest of the business. Perhaps a better word here would be “integration”.

Finally, the alignment of IT with the rest of the business needs to be supported from the CEO on down. Without top-level support, it’s never going to succeed. Strong collaboration between the business and IT is what will make alignment work. Remember that alignment is a dynamic process and that it will always be changing along with your business.

Do you feel that your IT department is effective? Do you believe that it is aligned? What steps are you taking to make it more effective? Do you think that you need to bother to align it with the rest of the business?

Just What Is This “Alignment” Thing?

Wednesday, March 11th, 2009
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IT Departments To Be Effective Before They Worry About Alignment

Once upon a time the Supreme Court justice Potter Stewart said that pornography is hard to define, but “I know it when I see it.” In the world of IT it would appear as though alignment with the business side of the house is a lot like pornography in this sense – it’s hard to define, but we’re all pretty sure that we’d know it we saw it. A survey that was done by the consulting firm Bain & Co. sure seems to confirm this.

It’s always a good idea to make sure that we’re talking about the same thing before we get into a big flame war. It turns out that the best definition of IT alignment that I’ve come across comes from Brian Watson over at CIO Insight magazine who defines it as “…synching up strategies [between IT and the business units]“.

The kids over at Bain have found that the two sides of the coin, IT and business, all too often misunderstand just what the concept of alignment is. Specifically, what a lot of companies try to do is to dole out IT resources to different business units and then they say “Ta-Da – we’re aligned”. They really should be syncing up their strategies.

Bain believes that making your IT department more effective is the correct first step before you go worrying about alignment. Effectiveness is defined as being excellence in process management and execution. Of course, you need to be able to make these repeatable and consistent. On the other hand, alignment means that IT and the business have a proactive relationship.

I’ve always looked at these two parts of making the business run more smoothly as being joined at the hip. Effectiveness is how things get done every day. Alignment is the direction that you are moving in. Both are needed to have a well run IT department.

Do you feel that your IT department is effective? Do you believe that it is aligned? What steps are you taking to make it more effective? Do you think that you need to bother to align it with the rest of the business?