Posts Tagged ‘it governance’

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6 Reasons That IT / Business Alignment May Be Impossible To Do

Wednesday, January 13th, 2010

A quick quiz for you: what has been the #1 task on every CIO’s to-do list for the better part of the past 20 years? If you guessed “aligning IT with the rest of the business” then you are correct. This has been an IT goal for the past 20 years? What’s up with that? When you become CIO what are you going to do to solve this problem. Can it even be solved?

It’s All About Communication

Why has something that sounds so simple when we talk about it been so hard for CIOs to do? Tony Kontzer over at CIO Insight has taken a look at what’s been holding CIOs back and he’s come up with one answer: communication.

I’m pretty sure that we all know where this one is going. The non-IT business folks like to spend their time talking in business terms and we over on the IT side of the house seem to be only able to communicate using IT jargon. The results of this inability to communicate can be disastrous.

The Tower Of Babel — IT Style

When the business side of the house and the IT side of the house find it hard to communicate, what happens is that they simply stop communicating. When this happens, each side goes off and starts to do its own thing.

I can’t tell you how many firms that I’ve worked for where I’ve seen this happen. When communication breaks down between IT and the rest of the business is when you start to see the multiplying factor start to show up: multiple email systems, multiple ERP applications, etc.

From a CIO perspective, this is the worst thing in the world that can happen. The reason is that every IT system that gets added to the company means that there is one more system that needs to supported forever and that boosts the cost of having the IT department do work that does nothing to help the company’s bottom line.

The Big 6

When you become CIO, how will you be able to measure how well the IT department and the rest of the company are doing in trying to align themselves? Well, you’ll have to fall back on what everyone in IT loves the most: metrics. The trick is knowing what needs to be measured. Here are the top six alignment metrics as recommended by the Society for Information Management (SIM):

  1. Communication Channels: Have effective communications channels been established between the IT department and the other departments in the firm? Are these channels being used?
  2. Metrics: are metrics in place and are they being measured in order to determine where the firm stands in it’s efforts to align how the business processes operate and what the IT department spends its time working on?
  3. Governance: are there processes in place that will ensure that what IT works on lines up with what the company’s true business needs are?
  4. Partnership: is there a partnership between IT and the rest of the departments where each is taking actions to make the other more successful?
  5. HR: does the HR department understand what the company is trying to align and are they taking action to attract and retain the talent that will be needed to make this happen?
  6. Technology: are the right tools in place and available to be used in order to drive the changes that will be needed to transform how business is done once the alignment has occurred?

What All Of This Means To You

For way too long CIOs have been looking for ways to try to align what IT does with what the rest of the business needs. So far they have not been successful.

The primary stumbling block has been the simple fact that there exists an enormous two-way communications gap between the IT department and the rest of the firm. IT communicates using technical terms that nobody else knows about while the rest of the firm communicates using business terms that make no sense to the IT staff.

A first step in finally bridging this gap is to implement the six alignment process metrics that we’ve identified. When you become CIO these will provide you with a way to measure your progress in finally getting the IT department to become a meaningful part of the firm. Nobody ever said that this was going to be easy, but at least now you have a plan for how you can accomplish the impossible.

What do you think is the biggest barrier stopping the IT department from working more effectively with the rest of the company?

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What We’ll Be Talking About Next Time

When you become CIO, you’ll probably have all of the technical skills that you need to stay on top of today’s cutting edge IT issues such as storage, bandwidth, cloud computing, etc.  However, there is one thing that you may have forgotten to get: a law degree…

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It Takes A Strategic Execution Officer To Get Anything Done Around Here

Monday, November 30th, 2009
Image Credit CIOs Have Yet Another Hat To Wear: Mr. Make-Sure-The-Project-Is-A-Success

CIOs Have Yet Another Hat To Wear: Mr. Make-Sure-The-Project-Is-A-Success

We all dream of the day that we will get the nod to become CIO — finally we will have arrived. Or will we have? Take just a moment and think about all of those major projects that you’ve see during your career that started out with a bang and ended up failing and going away with a whimper. When you are CIO, things are going be different and that’s because you won’t just be the CIO, you’ll also be the company’s Strategic Execution Officer.

What Have I Signed Up For?

Business processes are like pit-bulls: they really don’t like change and if you try to change them, they are probably going to bit you really, really hard. This is one of the reasons that so many major company initiatives fail — nobody really wants to go to the effort to change.

What’s been missing for far too long has been a Strategic Execution Officer and since so many of today’s major projects involve the IT side of the house, who better to assume this role than the CIO?

In your future role as your company’s CIO / Strategic Execution Officer you will not only be responsible for making sure that the new IT systems go in on time, but also that the company’s processes and the behaviors of the staff are changed so that the new way of doing business actually gets implemented.

Sound challenging? It does to me. That’s why we need to reach out to researchers Dr. Jeanne Ross and Dr. Peter Weill who have taken the time to look into what four things a Strategic Execution Officer needs to do. Let’s see what they recommend.

Create & Manage IT Systems Used For Strategic Initiatives

A CIO will tend to look at a given project and search for ways to get it successfully implemented. A Strategic Execution Officer realizes that in order for the company to be successful, the core processes that allow the company to operate smoothly and efficiently need to be digitized.

This means not just one IT project, but potentially several need to be done in such a way that they support the company as it is today and as it will be tomorrow. Key components of this type of solution include a single well-managed database, a standardized development system that allows the creation of different applications to easily talk to each other, and a solid communications network so that workers can access the data and applications that they need from just about anywhere.

Become A Leader In How The Company Does IT Governance

The CIO / Strategic Execution Officer is the one person in the company who is best situated to see it all. This means that you are going to have to take an active role in the company’s IT governance process.

You are going to have to be able to make some hard calls when it comes to identifying what the company’s IT priorities are. On top of this, you will have to be able to communicate to others in the firm what the different trade-offs are to each decision.

Make Business Units Actually Use Digitized Business Processes

Time to play Mr. Tough-Guy here. As Strategic Execution Officer you are going to have to show up and make each of the company’s business units start to use the new digitized business processes once the implementation is done. This is not going to be easy to do.

We all know how this plays out: a project goes in and then half of the company finds a way to get their jobs done without using the new system because they don’t want to be bothered to learn how the new system works. You must not allow this to happen. If you have to take away the systems that are allowing them to work around the new system, then so be it.

Create Both Structures And Initiatives That Make The Company Change

Making the entire IT organization ultimately report to the Strategic Execution Officer solves the problem of how to motive the IT staff to follow through on a company-wide change. In firms that have multiple CIOs, this is one way to quickly solve a lot of common structural problems.

Getting the business unit leaders to sign up and agree to use the results of a multi-year IT project can be tricky. Identifying and removing real and perceived obstacles is one way to go about doing this. Another is taking the time to talk with each business unit leader in order to make sure that they understand why the change is happening and how they will benefit from it.

What All Of This Means For You

Becoming the CIO of your firm will be a major accomplishment in your IT career. However, far too many of us have become CIOs only to eventually fail at implementing some major company-wide project.

The reason that so many of these projects fail is because the company lacked a Strategic Execution Officer to see the project through from start to finish. This is a role that you are going to have to be willing to step up and play.

As the Strategic Execution Officer you will be responsible for coordinating projects that span the entire company. Your ability to be successful at doing this won’t rest so much on your technical skills as they will rest on you ability to motivate the business unit heads to participate in both the project and its final results. Good luck!

What will a Strategic Execution Officer’s biggest challenge be at your company?

Click here to get automatic updates when The Accidental Successful CIO Blog is updated.

What We’ll Be Talking About Next Time

Just imagine the day that you become CIO: you’ll be able to shed all of those past associations and friendships that have gotten you to this exalted position and finally you’ll be able to focus on what really matters: forging strong links with your company’s senior management. Well, sure, if you don’t really need to get anything done…

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CIOs Need Smart Storage, Not More Storage

Monday, September 21st, 2009
Where To Put Everything Is A CIO Sort Of Problem <p> (c) -2007) </p>

Where To Put Everything Is A CIO Sort Of Problem (c) -2007)

With a little luck we can all agree that storage is a boring topic to talk about – I mean when you store something, it’s just sitting there not doing anything. CIOs prefer to talk about data in motion – reporting new sales or opening new markets. However, it turns out that storing data is the foundation that the company is built on and CIOs need to do this the right way…

Times They Are A Changing

The days of blindly adding more cheap storage are over – storage has long term costs. CIOs need to revist this issue and create a solution that works for both today and tomorrow.

Steve Delahunty, who works for Booz Allen Hamilton, has been looking into the storage challenges that today’s CIOs are facing and he agrees that we’ve got some challenges facing us.

The old approach to storage was to simply add more cheap storage as needed. This doesn’t work any more for a number of reasons. Just adding more cheap storage is a big waste of money, power, and floor space in data centers.

The new approach to adding more storage that CIOs need to quickly adopt is to realize that when it comes to adding more storage they need to consider the full storage environment: data security, disaster recovery, environmental concerns, etc.

Why The Old Way Of Adding Storage Doesn’t Work Anymore

In the brave new world in which we live, most companies are experiencing double digit storage growth. Sure, we are collecting more information about our customers, managing our supply chains from start to finish, and creating new web portal with which to interact with our customers nearly every day.

However, our dirty little secret is that often the data that we are storing is no longer needed. This may represent a huge liability if our company is ever sued – can you image the cost and effort that it would take to search through all of that (useless) stored data?

If that wasn’t enough to convince you that the the old way of just adding more cheap storage was the wrong way to run an IT shop, then consider this: Delahunty’s research shows that the amount of power that data centers use has doubled in the past 5 years. On top of this, the national average for the cost of electricity has shot up by 44% since 2004.

The Right Way To Store Things

So what’s a CIO to do? First, you’ve got to change the way that you’re doing business when it comes to adding storage. Instead of just meeting requests for more storage, CIOs need to start to make sure that they understand the business requests behind storage needs.

What this means is that the IT department needs to get more involved in understanding just what they are being asked to store. As the requests come in, they need to take the time to classify the value to the business of the data that is being proposed to be stored. When data doesn’t met the “I must always have access to it” criteria, then that data either needs to stored on inexpensive off-line storage or simply discarded.

You may have already realized this – this type of data analysis cannot be automated, it’s a people job. IT staff need to be involved in the data classification process in order to ensure that good decisions are made.

Final Thoughts

Once upon a time, adding additional storage was something that CIOs didn’t have to spend a lot of time thinking about. Storage was cheap and getting cheaper every day and so it seemed like you could keep growing your storage farms forever.

Reality has caught up with us and environmental costs coupled with possible legal issues have turned the world of storage upside down. Now CIOs need a new strategy to deal with their company’s growing storage needs.

Classifying the data that you are going to be storing is the correct first step. Weeding out what doesn’t need to be stored and then using the classification system to move non-critical data to low cost storage solutions can solve multiple problems all at once.

CIOs who can add more storage the right way will have found a way to apply IT to enable the rest of the company to grow quicker, move faster, and do more.

Click here to get automatic updates when The Accidental Successful CIO Blog is updated.

What We’ll Be Talking About Next Time

I’ve got a quick question for you: what is the next step in your career? What do you want to get promoted to? In fact, as long as we are talking about that, what comes after THAT promotion? If you want to become a CIO, then career ladder generally goes: IT worker, manager, director, executive director, CIO. Got a plan on how you are going to get to that next step?

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4 Innovation Strategies That Actually Work

Wednesday, September 16th, 2009
CIO's Looking For Innovation Need To Find The Four Techniques

CIO's Looking For Innovation Need To Find The Four Techniques

Innovation, innovation, innovation – everyone wants it, but nobody seems know know how to get and keep it. CIOs are under a lot of pressure to do more with less these days and being able to nurture an environment of innovation sure would help. The trick is HOW to do this…

The Problem With Innovation

One of the big problems that CIOs have is that when they start to think about innovation, they start by imagining a big blank sheet of paper and then they try to figure out how they can be innovative. This is exactly the wrong approach.

It turns out that how to innovate is NOT a blank sheet of paper – what techniques work is well known and now what techniques work together is also known. Two professors, Dr Frank Rothaermel and Dr. Edward Hess have taken a close look at what innovation techniques work, and they’ve discovered the four that work best.

Four Types Of Innovation

The first thing that CIOs need to realize is that there is no one-size-fits-all solution to finding an innovation strategy that works for a firm. Instead, there are four different approaches that seem to work the best. Just to make things more complicated, each of the four different approaches can be be combined. However, not all combinations result in more innovation. Let’s take a closer look.

The four different types of innovation that work best for firms are:

  • Recruiting & cultivating human capital,
  • Spending more on internal R&D
  • Strategic alliances,
  • Acquiring technology ventures

It is important to note that all four approaches can be pursued individually or all at once. However, going after more than one approach can allow a firm to achieve a higher level of innovation, but some strategies don’t mix well and can cause a firm to end up wasting both time and money. The key is to know which techniques work well with each other.

The Best Way To Foster Innovation

You knew that I was going to say this: the research shows that the best way to achieve continuous innovation over time is to hire and cultivate talented people. As always, this is something that is easy to say, but very hard to do.

The reason that taking the time and investing the money in your staff is the best way to foster long term innovation is because this approach allows an IT department  to to have more control over their IP and creates a steadier pipeline of innovation since no outside partners are being relied on.

To improve the odds of this approach working, the best IT departments build teams that are made up of both star and non-star employees. This allows the stars to look for new ideas while the non-stars turn ideas into successful products. Once again, you can see that although this is a powerful idea, it takes some serious CIO management skills to make it happen.

How To Combine Innovation Techniques

When a CIO decides that innovation must be boosted, all too often they will start throwing money at a variety of different techniques without fully understanding how they will (or won’t) work together.

For example, investing money in creating alliances is often done to create the same type of knowledge that companies can get from investing in their own people.

CIOs that invest in both approaches end up wasting money because of the overlap. The key question that a CIO needs to answer before perusing an alliance on top of developing star and non-star employees is to understand what key assets will be gained through the alliance that he/she can’t get from  their own employees.

Dr. Rothaermel and Dr. Hess have discovered that the two approaches that work the best together are alliances and acquisitions. CIOs that take the time to  form a joint venture with a vendor partner company before trying to buy it gives the CIO critical inside information on the target firm.

It turns out that both alliances and internal R&D spending also complement each other. Internally developed knowledge allows CIOs to better understand what market areas will become promising and this allows them to invest in the most promising alliances.

Final Thoughts

There is saying that goes “there is nothing new under the sun.” This holds true for CIOs that are seeking to boost the innovation in their departments.

It turns out that studies have shown that there are four innovation techniques that work the best. These four techniques can be combined and used together; however, CIO should only pursue multiple innovation strategies if they complement each other. CIOs who can grow innovation within their departments will have found a way to apply IT to enable the rest of the company to grow quicker, move faster, and do more.

Click here to get automatic updates when The Accidental Successful CIO Blog is updated.

What We’ll Be Talking About Next Time

With a little luck we can all agree that storage is a boring topic to talk about – I mean when you store something, it’s just sitting there not doing anything.CIOs prefer to talk about data in motion – reporting new sales or opening new markets. However, it turns out that storing data is the foundation that the company is built on and CIOs need to do this the right way…

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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.

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