The Three Stages of Business-IT Alignment

Innovation can be free—for those IT organizations that have climbed the IT-business alignment ladder.

“What happens is that almost by accident you start to uncover opportunities,” says John Hughes, CEO of IT and management consultancy GrowthWave, which focuses on improving IT’s leadership and governance and its alignment to business objectives.

“The business says they have a great opportunity and they never would have said that to IT in the past, and IT will say there’s a technology coming out that corresponds to that, and simply because of this conversation—and no deliberate investment in trying to uncover innovation—they create innovative opportunities,” Hughes says.

But organizations won’t get to the innovative alignment stage unless they first get to strategic alignment—and they won’t get there before they’re tactically aligned. Each stage builds on the one before, but ultimately all stages will co-exist together in the best-aligned organizations.

At its heart, Hughes says, all IT-business alignment is making sure that an IT organization is always working on the right things for the business, and that those right things are the things that deliver the highest value to the business.

“The only way to accomplish that is for IT to be in continual communication with the business,” he says. IT can’t be in the position of deciding on its own what the priorities will be, and making decisions for the business—which happens all too often.

Hughes recently spoke to bITa Planet about the three phases of alignment, and how to achieve them.

bITa Planet: Define tactical alignment.

Hughes: Tactical alignment is the key stage, because most IT organizations are still not very good at it. I hear from CEOs and business leaders all the time the question, “Am I getting value out of IT?” And that’s because IT organizations still struggle with tactical alignment. Businesses don’t see IT’s value until you move into strategic alignment, where IT helps grow the business or increase profitability.

At the tactical level, what’s frustrating to the business is that IT organizations are notorious for being firefighters. The whole point about tactical alignment is to get the day-to-day business support, whether infrastructure, maintenance, or help desk, with the least number of people, and least dollars, and automate as much as possible. You want to create dollar and people capacity. And then invest that capacity you’ve created through tactical alignment in strategic alignment, and that’s where the business starts seeing returns on investment.

IT organizations are good at creating capacity to do more — that’s the point of technology, but within IT we typically dump that right back into firefighting.

But IT departments often pride themselves on being firefighters.

I was brought in as interim CIO at an organization where the IT director said he loved firefighting and created an environment where IT was about firefighting — that was outrageously inefficient. I told the business that for a period of time IT would do perceptively less in order to stop IT people from just moving from one task to another. I wanted them to optimize the amount of tactical work they did in order to create capacity.