Have You Got Any ‘Watermelon Data’?
Q: How long will it take to fix alignment? A: 6.15 hours!
Few CIOs or CTOs are content for their departments to be seen as support functions. Rather, they want to be considered a ‘strategic business enabler' – as critical to delivering on business strategies for success. That is not easy, however, especially for those IT departments that have traditionally been considered a support functions.
Our research points to 11 factors that prevent CIOs and CTOs from connecting IT to business strategy. However, as the list below shows, all of these obstacles can be overcome.
1. It's difficult.
Getting clarity and alignment in respect of the business impact of a digital or technological investment is far from straightforward. After all, they say: ‘If it ain’t complex, it ain’t strategy!’
Moreover, compared to technology decisions, which are often relatively ‘black and white’, issues of business strategy can seem ‘fuzzy’ or ‘gray’.
To engage with strategy, CIOs and CTOs may need to be more curious, as well as more comfortable with ambiguity and uncertainty.
2. There is no time!
Connecting IT projects and initiatives to business strategy, requires a lot of thinking. It also requires considerable dialogue with the various stakeholders involved. But, where can CIOs find the time for this?
CIOs face increasing pressure to deliver, they are juggling multiple projects and initiatives at a time of scarce resources. With so much to be done, they struggle to find time for more talking and thinking.
A key first step is to segment the IT project portfolio, then to think strategically about those projects and initiatives that are most important to the business.
3. Limited Power & Influence
IT may not have a seat at the table when people are talking about strategy, or when budgets are being decided. The CTO/CIO may not have sufficient power, access or influence.
The CIO/CTO needs to be in the room when business strategy is being talked about. They need to bring value to the strategic conversation at the C-suite.
Engaging with the C-suite can test confidence, as well as the ability to build trust and influence.
4. The Business Case
Most organizations have arrived at the point where even a modest spend (e.g. $10k) requires some form of a business justification. That may be one page or 10 pages, but increasingly technology decisions are now business decisions too.
To get sanctioned, the need must be demonstrated, also the savings or payback that will result. For some, this is a bureaucratic hurdle policed by procurement, rather than a tool of strategy. Building the business case is an essential, but underdeveloped skill for IT leaders.
While, budgets and spreadsheets are not the IT leader’s primary skill, clarifying and communicating the business impact of any investments made is key.
CIOs and CDOs are often faced with the issue of communicating the return on investment (ROI) re the digital strategy or any aspect of IT. This can be a real challenge, but it is not one that IT should face alone. CIOs who spend hours trying to answer the ROI question via a spreadsheet often come up short. That is because, key cross-functional stakeholders need to be involved. Ask the customers for the various technologies and solutions that IT is charged with delivering to help in providing the business justification.
5. Legacy Issues
The term legacy is typically used in talking about past investments in IT that are now outdated and may constrain options for the future. Frequently overlooked is the IT Department's own (non-tech) legacy. That is its reputation or track record, as seen by others across the organization.
There are long memories and legacy issues associated with most IT Departments. Changing how people think about the IT Department is often necessary. This is especially true where IT is (rightly or wrongly) considered as inhibiting rather than enabling innovation. Also, where there is perceived to be a legacy of underperformance or failed initiatives by the IT Department.
To break free from the past, IT may need to signal a change in its mindset and behavior towards its internal stakeholders.
6. Confidence & Skill
Not surprisingly, many IT leaders think: ‘Let’s stick to what we are good at – that is the technology part of the equation’. After all, that is their primary area of knowledge or skill. They are thus reluctant to wander into the business territory (even if they are asked).
Naturally, IT leaders may shy away from issues of strategy, vision, culture and so on. However, where IT aims to be considered a strategic business enabler, it does not help.
Engaging with issues such as business need and business impact is key to IT being considered a strategic investment. Time and again, IT professionals demonstrate that they can contribute meaningfully to the business discourse regarding strategy.
7. Asking Why?
Connecting IT to business strategy requires asking the question. However, most IT leaders don't ask why often enough.
IT projects tend to be highly technical and by necessity focus on ‘the how’. Those leading them often assume that others are clear on ‘the why’. This is a dangerous assumption, especially in an era where there are lots of projects competing for scarce time and resources.
Asking the why question has three levels:
- Why this IT initiative or investment?
- Why now?
- Why this approach, rather than another option or alternative?
Sometimes leaders fear asking the ‘why' question – they may fear that the answer could undermine their project or initiative. However, if there is doubt or confusion about the why, it is generally better for IT to face it head-on, rather than waiting for others to do so.
3. Portfolio Thinking
A portfolio mindset is key to it being a strategic player. In this way, IT leaders recognize that not all projects and initiatives are equal – some are more important or strategic to the business than others.
Linking IT investments with business strategy requires joined-up thinking. That means leveraging the synergies, linkages and dependencies between the various IT projects and initiatives within the portfolio. However, this isn't happening enough, with many project being managed in silos and decisions being made on a stand-alone basis.
There will always be more projects and initiatives than available resources. This can result in difficult choices, tradeoffs too. Moreover, not all projects and initiatives can or should start at the same time, getting the prioritizing, sequencing and timing right is at the essence of strategy.
8. Cross-Functional Collaboration
Engaging internal stakeholders can be a challenge. In particular, cross-functional collaboration is difficult for organizations that have traditionally been structured along functional lines.
Projects and initiatives that are not connected to strategy are solo-runs, with IT is operating in a silo. In reality, however, many IT leaders have a peculiarly hands-off approach to their stakeholders – it is a key blind spot.
There is, however, one thing that can and should unite all departments and functions within the organization (from IT to Finance), that is business needs and priorities.
9. The Language Gap
There can be a language gap – a gap between tech jargon and business speak. For example, IT teams frequently face challenges in conveying their value (using technical data and metrics) to the C-suite which is focused on business performance and shareholder value. Meanwhile, business executives regularly struggle to engage with technical terminology.
IT must learn to communicate in a language that resonates with the C-suite, going beyond technical data to talk about business impact, strategy and success.
To ensure that its role is understood and valued at the strategic level, IT needs to use simple language, avoiding jargon and technical terms that might confuse non-technical executives. It also needs to frame IT achievements in terms that align with C-suite priorities like market growth, operational efficiency, and revenue generation.
10. The Clock is Ticking!
Many IT leaders think: ‘The project will never get started if we have to wait until there is clarity regarding all of these business-related issues’. Take, for example, the requirements of building the business case or engaging internal stakeholders and the number of meetings, emails and reports likely to be required.
However, the time savings may be illusory. After all, if an initiative is not connected to strategy at the start, it can cause many problems and lost time, later.
If a project is strategically important, make time for strategic conversations with the key stakeholders involved at the start. In other words, you may need to slow down to speed up later.
11. The Job is Never Fully Done!
Connecting it to strategy is a job that has never really complete. It is not just a once-off, but needs to happen at the start, at the end and in the middle too!
A. Connect Early
Connecting to strategy must be done early, or it may be too late. When projects are up and running, there is often the expectation that people will demonstrate unquestioning commitment to them.
It can be difficult to ask questions such as: ‘Is this really a key strategic priority?’, ‘Why are we doing this?’ or ‘Why are more resources not allocated to this?’
These are great questions, if asked early enough — that is, during the foundational first mile of a project or initiative.
B. Connect Often
Connecting IT to business strategy is an ongoing requirement, rather than a once-off. That is because, business needs and priorities are continually changing. Just because a project is connected to strategy at the start does not mean that it will remain so throughout.
In addition to checking against time, budget and resources, project reviews should connect to strategy. That means asking: ‘How is the project addressing business needs and priorities today?'
C. Connect to Close
The last mile of a project is of critical importance in terms of connecting it to business strategy and IT project goals to business results.
The lesson of ‘the longest mile’ is to never take project success for granted. Be ready for setbacks and disappointments, especially in the final phase of a project. Most important of all, make sure you don’t arrive at the finish line only to find that it has moved and that stakeholders are waiting impatiently somewhere else.
The issue of benefits realization cannot be left to chance. Nor can the related issues of embedding change and building capability, which are also key to how IT investments impact strategy.
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