Posts Tagged ‘Information technology management’

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Shadows in the late afternoon. (Photo credit: Wikipedia)

Last week I read an article of Raf Cammarano, which got my attention. In this article it is stated that alignment is about a fixed position at a certain point of time. Although I have seen lots of other definitions, which define Alignment as a process, rather than a state, Cammarano defines alignment as making sure everyone is on the same pag at day 1. He states that the real issue is about synchronization, making sure everyone stays on the same page from day 2 onwards. On this I agree. Cammarano comes up with four interesting types of lag, which all make it impossible for IT to stay synchronized:

  • Stimulus lag: the delay between the business changing course and IT finding out about it
  • Response lag: the delay between IT finding out about the change and deciding what to do about it
  • Execution lag: the delay between IT deciding what to do and actually doing it.
  • Results lag: the delay between IT completing what it needed to do, and the business seeing the results.

These four types of lag are recognizable, at least in my experience. Interesting though, is that many strategic alignment models and theories focus primarily on reducing the first two types of lag, by making sure IT’s strategy and business’ strategy are aligned. But, I am convinced that the last two types of lag, execution and results, are driving alignment even more. This is also something which is mentioned in my previous post, in which successful IT history is named an important influencer of the success of alignment.

Also in a survey published by A.T. Kearney, it is stressed that there is still work to do. While Business and IT executives agree on intent, they often disagree on delivery and execution. Business and IT executives have – according to the survey – very different perceptions on execution, and business executives are also more sceptical of IT’s budgetary efficiency.

Cammarano doesn’t mention real suggestions HOW to minimize the lags, although Oursourcing and Cloud computing should enable the synchronization or ‘movement’ strategy, as it is compared with a guerrilla. Cloud and outsourcing could eliminate fixed positions (data centres and legacy systems) and bring in additional firepower (outsourcing).

Reference

Raf Cammarano (2012) on http://www.rafcammarano.com/content/alignment-yesterdays-war.aspx

A.T. Kearney: Why Today’s IT Organizantion Won’t Work Tomorrow, 2012 http://www.atkearney.com/index.php/Publications/why-todayss-it-organization-wont-work-tomorrow.html

Jerry N. Luftman, well known for his Strategic Alignment Maturity Model (SAMM), published a new book: Managing the Information Technology Resource. It’s worth the money!

There are numerous articles, studies and models to be found on the topic Business/IT-alignment. This makes it hard to define which model is most adequate to use. But some models are apparently much more accepted than others, although there seems to be no consensus on the best one. The basis of many models seems to be the Strategic Alignment Model (SAM) of Henderson and Venkatraman [Henderson and Venkatraman, 1999]. This model suggests that IT-business alignment can be achieved by building linkages among four strategic domains:

The dimension of strategic fit differentiates between external focus, directed towards the business environment, and internal focus, directed towards administrative structures. The other dimension of functional integration separates business and IT. According to the authors, Strategic Alignment can only occur, when three of the four domains are in alignment.

According to Leonard [Leonard, 2008] the SAM-model merely describes what needs to be aligned. In the same study, Leonard points out that there has been far less consensus regarding how alignment is to be achieved. The model which is seen by Leonard as the model which gives insight in the processs by which alignment can be improved is the model of Luftman. This is more about the question how alignment is achieved. The theory of Luftman is found in many articles as a framework for assessing Alignment within a company, and looks very useful.

Luftman developed a maturity assessment model, based on the 12 elements of Business/IT-Alignment, which can be recognized in the model of Henderson and Venkatraman. The components of this model, in concert with the earlier enables/inhibitors research [Luftman and Brier, 1999], form the building blocks for the strategic alignment maturity assessment method [Luftman, 2000].

This model can be used in a survey to see where a company stands regarding maturity and once this maturity is understood, it can provide the organisation with a roadmap that identifies opportunities for enhancing the harmonious relationship of business and IT [Luftman, 2000]. The model consists of 6 alignment areas. Each area has multiple attributes. For each area there are clearly defined maturity levels. All areas should be given attention to mature the alignment between business and IT.

The areas are:

Communications

How well does the technical and business staff understand each other? Do they connect easily and frequently? Does the company communicate effectively with consultants, vendors and partners? Does it disseminate organizational learning internally?

Competency/Value Measurement

How well does the company measure its own performance and the value of its projects? After projects are completed, do they evaluate what went right and what went wrong? Do they improve the internal processes so that the next project will be better?

Governance

Do the projects that are undertaken flow from an understanding of the business strategy? Do they support that strategy?

Partnership

To what extend have business and IT departments forged true partnerships based on mutual trust and sharing risks and rewards?

Scope & Architecture

To what extend has technology evolved to become more than just business support? How has it helped the business to grow, compete and profit?

Skills

Does the staff have the skills needed to be effective? How well does the technical staff understand business drivers and speak the language of the business? How well does the business staff understand relevant technology concepts?

In my experience, the assessment-method of Luftman really provides enterprises and organisations with a tool which gives insights in the business/it-relationship. It is very useful in defining improvement areas, and even more important, it facilitates an open discussion with executives from business and IT. What it doesn’t, is providing guidelines how to improve the alignment between business and IT. But, the six dimensions cover, in my experience, quite nice on which elements attention should be given. Not at one specific, but all dimensions should be in harmony. I will come back to these dimensions in following posts.

References

Henderson, J.C. and Venkatraman, N.:Strategic Alignment: Leveraging Information Technology for Transforming Organizations, IBM Systems Journal, 1999

Leonard, Jenny: What are we aligning? Implications of a Dynamic Approach to Alignment, 19th Australian Conference on Information Systems, Christchurch, 2008

Luftman, Jerry and Brier, Tom: Achieving and Sustaining Business-IT Alignment, Calirfornia Management Review, Fal 1999

Luftman, Jerry: Assessing Business-IT Alignment Maturity, Communications of AIS, Volume 4, Article 14, December 2000

Cover of "Competing in the Information Ag...

Cover via Amazon

The search for a common definition of Business/IT-Alignment didn’t bring up one single version, although the topic is frequently seen in the Top 10 of IT Management issues. This is illustrated by [DeLisi and Danielson] who state:

“There was no generally agreed-upon definition of IT alignment among the CIOs that we interviewed. Indeed, interpretations ranged from alignment as a governance mechanism to alignment as a project portfolio mechanism. Broadly speaking, there was general agreement that IT alignment had to do with the alignment of the IT strategy with the business.”

There is also discussion whether Alignment is a ‘state’ that can be achieved, or a ‘process’ to get to a certain state. The concept of Business/IT-Alignment as a state is further developed by Luftman (2000), who assesses the Business/IT-Alignment maturity level of organizations [Sylvius, 2007]. The concept of alignment as a process, is presented by Weil and Broadbent (1998), by stating that “Alignment is a journey, not an event”.

Although a representative of the state view on alignment, Luftman connects the two perspectives when he states, “The endless, quicksilver shifting of business strategies and technology makes aligning them as difficult as surveying sand dunes in the Sahara. Organizations must draw ‘a line’ in the sand, however, and continuously ensure that the process for aligning IT and business is appropriately managed” [Luftman, 2003].

One definition that expresses both a ‘state’, the degree of alignment, as a ‘process’, the activities or methodology to reach a certain state of alignment:

“Business Alignment, the degree to which IT applications, infrastructure and organization enable and support the business strategy and processes, as well as the process to realize this.” [Sylvius et al, 2009].

One conclusion can be drawn. There is no single accepted definition on Alignment, but it’s clear that Business/IT-Alignment has to do with aligning Business and IT strategy.

References:

DeLisi, Peter S. And Danielson, Ron: A Research Study of IT Alignment.

Luftman, Jerry: Assessing Business-IT Alignment Maturity, Communications of AIS, Volume 4, Article 14, December 2000

Luftman, Jerry N.: Competing in the Information Age, Align in the Sand, Second Edition, Oxford University Press, 2003

Silvius, A.J.Gilbert: Exploring Differences in the Perception of Business & IT Alignment, Communications of the IIMA, Volume 7, 2007

Silvius, A.J. Gilbert, Waal, Benny de, Smit, Jakobus: Business and IT Alignment; Answers and remaining questions, PACIS 2009 Proceedings, 2009

Weil, Peter and Broadbent, Marianne: Leveraging the New Infrastructure, How Market Leaders Capitalize on Information Technology, Harvard Business School Press, 1998