Getting IT right Business IT Alignment

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1 Getting IT right Business IT Alignment A.J.Gilbert Silvius Lector Business, ICT en Innovatie

2 Gilbert Silvius 1963 Koninklijke Militaire Academie Fender Precision Bass Vlaardingen Koninklijke Landmacht Erasmus Universiteit MBA 2 kinderen Getronics Synergie Consultancy. Lector Business, ICT en Innovatie Projectmanagement Business ICT Alignment 2027 Katholieke Universiteit Leuven Ede PhD.. Utrechtse Ondernemers Academie Bedrijfseconomie Afghanistan Master of Informatics Aetsveld Master of Project Management

3 Hogeschool Utrecht

4 Kenniscentrum Innovatie en Business

5 Missie Wij inspireren en innoveren het onderwijs en de beroepspraktijk

6 Getting IT right Business IT Alignment A.J.Gilbert Silvius Lector Business, ICT en Innovatie

7 In what business is this company?

8 In what business is this company?

9 In what business is this company?

10 ICT als bron van innovatie hoog Transformatie Impact op Business Informatisering laag Automatisering Jaren

11 BIA strategies high Perception of external impact of IT low Business IT is business All technologies Service orientation Conservative IT saves costs Proven technology Efficiency orientation Innovative IT as competitive edge Experimental technologies Innovation orientation Essential IT essential in realising strategy New technologies Effectiveness orientation low high Perception of internal impact of IT

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14 Business IT Alignment Wat is het?

15 Business IT Alignment Business IT Alignment

16 Klare taal? Business IT Alignment IT Governance IT Planning Information Planning IT Service Management IT Strategy

17 Alignment?

18 Alignment? fit (Venkatraman, 1989) harmony (Luftman et al. 1993) integration (Weill and Broadbent 1998) linkage (Henderson and Venkatraman 1993) bridge (Ciborra 1997) fusion (Smaczny 2001)

19 Vragen Alignment: Proces of Toestand? Weill and Broadbent (1998): Alignment is a journey, not an event

20 Vragen Alignment: Proces of Toestand? Eenrichtingverkeer of wederzijdse beïnvloeding?

21 Wieringa et al. (2005): the problem of matching IT services with the requirements of the business Poels (2006): Alignment implies a mutual influence between business and IT.

22 Twee benaderingen BIA as the degree to which the business mission, objectives and plans are supported by the IT mission, objectives and plans

23 Twee benaderingen BIA as the degree to which the business mission, objectives and plans are supported by the IT mission, objectives and plans A more holistic view of BIA (Henderson and Venkatraman)

24 Het Strategic Alignment Framework Vier afstemmingsperspectieven: 1. Strategierealisatie 2. Technologie potentieel 3. Concurrentiepotentieel 4. Service niveau

25 Business IT Alignment Business IT Alignment is the degree to which the IT applications, infrastructure and organization, enable and shape the business strategy and processes, as well as the process to realize this. 25

26 Luftman (2000) Stimulansen voor BITA Top management sponsorship voor IT IT betrokken bij strategie ontwikkeling IT heeft goed begrip van de business Business-IT partnership Goede prioriteitstelling van IT projecten IT toont leiderschap Obstakels voor BITA Geen sponsorship van het topmanagement Relatie tussen business en IT afstandelijk IT ontbeert begrip van de business IT realiseert doelstellingen niet Zwakke prioriteitstelling IT projecten IT management ontbeert leiderschap

27 Jerry Luftman Business & IT Alignment Maturity

28 Maturity of the Business IT Alignment process Optimized Process Improved/Managed Process Business Strategy / Organization IT Established/Focused ProcessStrategy / Organization Committed Process Initial / Ad-Hoc Process Alignment gap

29 Business IT Alignment Maturity Variables Communications Understanding of Business by IT Understanding of IT by Business Inter-/Intra-organizational learning Protocol rigidity Knowledge sharing Liaison(s) effectiveness Value measurement IT Metrics Business Metrics Balanced Metrics Service Level Agreements Benchmarking Formal assessments/reviews Continuous Improvement Governance Business Strategic Planning IT Strategic Planning Reporting/Organization Structure Budgetary Control IT Investment Management Steering Committee(s) Prioritization Process Six IT Business alignment maturity criteria Partnership Business Perception of IT Value Role of IT in Strategic Business Planning Shared Goals, Risk, Rewards/Penalties IT Program Management Relationship/Trust Style Business Sponsor/Champion Scope & Architecture Traditional, Enabler/Driver, External Standards Articulation Architectural Integration: - Functional - Enterprise - Inter-enterprise Architectural Transparency, Flexibility Skills Innovation, Entrepreneurship Locus of Power Management Style Change Readiness Career crossover Education, Cross-Training Social, Political, Trusting Environment

30 Business & IT Alignment Maturity Variables Communications Skills Competency & Value Measurement Scope & Architecture Governance Partnership

31 Luftman companies

32 Why is alignment still an issue? The first reason is that the definition of alignment is frequently focused only on how IT is aligned with the business. Alignment must also address how the business is aligned with IT. Alignment must focus on how IT and the business are aligned with each other; IT can both enable and drive business change. The second reason is that organizations have often looked for a silver bullet. Originally, some thought the right technology (e.g., infrastructure, applications) was the answer. While important, it is not enough. Likewise, improved communications between IT and the business help but are not enough. Similarly, establishing a partnership is not enough nor are balanced metrics that combine appropriate business and technical measurements. Clearly, mature alignment cannot be attained without effective and efficient execution and demonstration of value, but this alone is insufficient. Our research has found that all six of these components must be addressed to improve alignment. The third reason IT-business alignment has been elusive is that there has not been an effective tool to gauge the maturity of IT-business alignment a tool that can provide both a descriptive assessment and a prescriptive roadmap on how to improve.

33 Luftman 2007

34 Main observations Industries vary in their alignment maturity Alignment maturity is rising Business executives score alignment higher than IT executives Rankings among Level 2, 3, and 4 companies are remarkably consistent

35 ROC BIA maturity onderzoek Ca. 25 ROC s, in twee groepen September 2009 Januari 2010 Februari 2010 Juli respondenten per ROC Business ICT Intermediair Vragenlijst gebaseerd op Luftman assessment Ist Soll

36 Overall Maturity Communications 5,00 Skills 4,00 3,00 2,00 1,00 0,00 Competency & Value Measurements Scope & Architecture Governance Partnership Totaal

37 Huidig / Gewenst Maturity Communications 5,00 Maturity Communications 5,00 4,00 4,00 Skills 3,00 2,00 Competency & Value Measurements Skills 3,00 2,00 Competency & Value Measurements 1,00 1,00 0,00 0,00 Scope & Architecture Governance Scope & Architecture Governance Partnership Totaal Partnership Totaal

38 Huidig / Gewenst Maturity Communications 5,00 Maturity Communications 5,00 4,00 4,00 Skills 3,00 2,00 Competency & Value Measurements Skills 3,00 2,00 Competency & Value Measurements 1,00 1,00 0,00 0,00 Scope & Architecture Governance Scope & Architecture Governance Partnership Totaal Partnership Totaal Spreiding Spreiding MAX Gem MIN 30 29b 29a MAX Gem MIN 30 29b 29a

39 Communicatie Communicatie Het Begrijpen van de business door de IT 5 4 De doeltreffendheid van samenwerken Het begrijpen van de IT door de business kennisdeling Evaluatie en van elkaar leren De mate van standaard protocollen Business Intermediair ICT

40 Communicatie Communicatie Het Begrijpen van de business door de IT 5 4 De doeltreffendheid van samenwerken Het begrijpen van de IT door de business kennisdeling Evaluatie en van elkaar leren De mate van standaard protocollen Business Intermediair ICT Communicatie De doeltreffendheid van samenwerken Het Begrijpen van de business door de IT Het begrijpen van de IT door de business 0 kennisdeling Evaluatie en van elkaar leren De mate van standaard protocollen Business Intermediair ICT

41 Waardetransparantie Waarde metingen De performance van de IT 5,00 Continue verbetering van prestatie indicatoren Achteraf evalueren van projecten 4,00 3,00 2,00 1,00 0,00 De performance van de Business De onderliggende link tussen Business en IT Waarde metingen Benchmarking Service Level Agreements De performance van de IT 5,00 Business Intermediair ICT Continue verbetering van prestatie indicatoren 4,00 3,00 2,00 De performance van de Business 1,00 0,00 Achteraf evalueren van projecten De onderliggende link tussen Business en IT Benchmarking Service Level Agreements Business Intermediair ICT

42 Governance Governance Strategische business planning 5,00 Projectprioriteit Bestuurscomités 4,00 3,00 2,00 1,00 0,00 Strategische IT planning Organisatie structuur en rapportage Governance IT investeringen Budget beheer van IT Strategische business planning 5,00 4,00 Business Intermediair ICT Projectprioriteit 3,00 2,00 Strategische IT planning 1,00 0,00 Bestuurscomités Organisatie structuur en rapportage IT investeringen Budget beheer van IT Business Intermediair ICT

43 Partnership Partnership Beeldvorming business over de waarde van IT 5,00 4,00 3,00 Allocatie van middelen 2,00 1,00 0,00 De rol van IT in strategische business planning Partnership Relatie & vertrouwen tussen business - IT Gedeelde doelen, risico's en beloningen Beeldvorming business over de waarde van IT 5,00 4,00 3,00 Business Intermediair ICT Allocatie van middelen 2,00 1,00 De rol van IT in strategische business planning 0,00 Relatie & vertrouwen tussen business - IT Gedeelde doelen, risico's en beloningen Business Intermediair ICT

44 Scope en Architectuur Scope & Architectuur Scope van IT 5,00 4,00 Transparantie en Flexibiliteit 3,00 2,00 Standaardisatie protocollen 1,00 0,00 Scope & Architectuur Architecturale integratie(bedrijfsniveau) Standaardisatie van IT processen Scope van IT 5,00 4,00 Architecturale integratie(afdelingsniveau) Business Intermediair ICT Transparantie en Flexibiliteit 3,00 2,00 Standaardisatie protocollen 1,00 0,00 Architecturale integratie(bedrijfsniveau) Standaardisatie van IT processen Architecturale integratie(afdelingsniveau) Business Intermediair ICT

45 Skills Vaardigheden Innovatie & ondernemerschap 5,00 Sociaal & politiek betrouwbare werkomgeving 4,00 3,00 2,00 Machtsverdeling 1,00 0,00 Personeelstraining Managementstijl Vaardigheden Carrière overstap Veranderbereidheid Sociaal & politiek betrouwbare werkomgeving Innovatie & ondernemerschap 5,00 4,00 3,00 Machtsverdeling Business Intermediair ICT 2,00 1,00 0,00 Personeelstraining Managementstijl Carrière overstap Veranderbereidheid Business Intermediair ICT

46 Wat te doen? Communications Understanding of Business by IT Verdiep Understanding of IT by je Business in Inter-/Intra-organizational learning de business Protocol rigidity Knowledge sharing Liaison(s) effectiveness Value measurement IT Metrics Business Wees Metrics Balanced Metrics transparant Service Level Agreements Benchmarking Formal assessments/reviews Continuous Improvement Governance Business Creëer Strategic Planning IT Strategic Planning stuurmogelijkheden IT Investment voor Managementde Steering Committee(s) Reporting/Organization Structure Budgetary Control business Prioritization Process Six IT Business alignment maturity criteria Creëer Partnership Business Perception of IT Value Role of IT in Strategic Business Planning Shared Goals, Risk, Rewards/Penalties betrokken- IT Program Management Relationship/Trust Style Business Sponsor/Champion heid Creëer een Scope & Architecture Traditional, Enabler/Driver, External Standards Articulation Architectural Integration: effectieve - Functional - Enterprise architectuur - Inter-enterprise Architectural Transparency, Flexibility Ontwikkel de Skills Innovation, Entrepreneurship Locus of Power Management Style kwaliteit Change Readiness van Career crossover Education, Cross-Training Social, Political, Trusting Environment medewerkers

47 IT strategieën Perception of external impact of IT high low Business IT is business All technologies Service orientation IT does Conservative IT saves costs Proven technology Efficiency orientation matter! Innovative IT as competitive edge Experimental technologies Innovation orientation Essential IT essential in realising strategy New technologies Effectiveness orientation low high Perception of internal impact of IT

48 Strategie geeft Alignment Innovative IT strategy Essential Conservative Low Alignment capability High

49 The new IT professional

50 Competenties Technical Competencies Technical knowledge Domain knowledge Tool knowledge Product knowledge Project knowledge. Behavourial Competencies Leadership Engagement & motivation Self-control Assertiveness Relaxation Openness Creativity Results orientation Efficiency Negotiation Values appreciation Ethics Contextual Competencies Business (general) Business (specific) Marketing Systems, products & technology Personnel management Health, security, safety & environment Finance Legal

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