IT Alignment

IT Alignment or Business IT Alignment (also known as BITA) is misconceived by many IT executives. They feel that they are aligned but actually they are not. The reason behind this simple misunderstanding is that the CEOs think they have business justifications for all their current IT projects.

This general misconception of IT alignment reduces the effectiveness of IT as a strategic tool that provides a competitive edge. Therefore, IT alignment means making thr best use of IT to develop business value. This involves making an appropriate use of IT equipment to improve your business. The business will be properly aligned when all the IT equipment is allocated to the right departments within an organization.

Service request from various departments should not serve as the force to develop the IT projects. This can lead to a number of problems. The first problem that arises from this situation is that IT does not provide effective solutions based on these requests because each problem has to be quickly solved, on a real time basis. The more suitable approach involves recognizing the problem by analyzing the current system and then generating the proposed solution. The second problem is that the business requests originate from individual needs rather than the long term strategic planning. Therefore, these requests do not provide any long lasting benefits for the company.

IT alignment can be achieved by following the steps given below:

• Top management should do the overall planning. They must develop the strategic goals of the company. These goals are documented for future references. The goals that are non-specific, immeasurable or non-strategic should not be included in the documentation.

• All the initiatives taken by the company should be collected. They can contribute in the achievement of strategic goals for the company.

• The company needs to conduct brainstorming sessions to find out any undiscovered ways with which IT can assist the strategic goals. These sessions should also try to unravel business initiatives from the above two steps.

• During this step, both the new and formerly un-identified opportunities are prioritized and planned so that proper resources are allocated to them.

Achieving IT alignment is a difficult task. The basic mistake in all IT alignment plans is that they do not convey the true business value. These plans also fail to mention what strategic and tactical business benefits the company is planning to receive. A professional IT alignment plan must include the business metric. However, it shouldn’t contain an IT metric for delivery of application.

IT investments should be based on the following three activities:

1. Keeping the lights on.

2. Achieving stepwise improvements leading toward accomplishment of business goals.

3. Systematically changing business processes and their corresponding metrics through transformational investments.

Normally the problems of IT alignment arise from one or all of these three areas. Most of the IT planning is done by top executives who have little idea of new technology. They are only updated by magazines or sales people. These executives consist of CEOs, CFOs and COOs. They only use the latest technology to assist them in running the company. The executives believe that software programs like ERP, SCM, KM, data mining will increase their profits by improving the company’s performance and building new customers. However, in few cases they do come up with ingenious solutions but most of the time the costs outweigh the gains. Most companies may have grown structurally stronger but when IT experts analyze them, they find these companies to be the same or worse, just because they are not properly aligned.