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The 6 keys to IT-business alignment

October 15, 2008

A number of core principles have emerged that are critical to bringing IT and business closer together. Before I list them, here’s a serious caveat: to really make the most of IT in business, it’s important to realize that both have to bend. Like two people locked in a small box, for an IT organization and its business ‘customer’ to get comfortable, they both have to coordinate their actions so that neither gets an eye gouged or a foot stuck in an awkward place. Business and IT are intimately intertwined.

Either you decide to embrace the role of IT in business or you decide to ignore the possibilities and accept current state of compromise.

For the vast majority of organisations that wish to align their IT closer with the business, we believe there are a number of principles which, applied in the right way, will offer significant benefits over just sitting on hands and hoping some bright spark will take the problem away. We’ve condensed the findings of our research into six principles, and the later chapters will look at each one in more detail. These are as follows:

  • The IT organization must get the basics right: without the fundamentals of sound IT service delivery, it will be impossible to build the appropriate level of trust with the business.

  • Create a common language: a shared understanding of goals, strategies, activities, metrics and change implications is a crucial foundation for the delivery of effective IT  capabilities. A common language is essential for the establishment and maintenance of that shared understanding.

  • Establish a peer relationship between business and IT: there needs to be real sharing of authority and responsibility when it comes to making and implementing decisions that have implications for business and IT.

  • Work towards coordinated goals and objectives: a common language is not enough if ever-broadening communities of IT stakeholders are to be led in a way that promotes agreement on what’s important and what isn’t. IT–business alignment needs a culture that promotes working together in a coordinated way to meet shared goals and objectives.

  • Manage IT as a business-driven portfolio: effective management of IT investments requires a big-picture view that does not just consider work that is planned or in progress, but also fully encompasses past investments to ensure a net overall contribution of value to the business from IT spending. This view needs to balance risks, costs and returns across the business as a whole.

  • Foster relationships with key IT suppliers: effective supplier management is essential, because suppliers provide IT capabilities and are potentially an invaluable source of skills, resources and insights to help optimize the delivery and support of services to the business. More than that, though, a lack of supplier management can lead to higher costs, unnecessary risks and failure to maximize return on IT investments.

While these principles can be applied in isolation, there are many synergies and dependencies between them. If the IT organisation cannot establish business trust by getting the basics right, for example, then it becomes very difficult for IT to establish a peer relationship with the business. Similarly, coordinated goals and objectives can only be worked towards if there is a common language between business and

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