Business-IT alignment is a holy grail in large enterprises. It’s no secret that IT departments and business units have struggled to find common ground. Each group created stereotypes that served to reinforce the divide. Technology had a supporting role when it came to business strategy until digital transformation made IT a requirement for business success. Suddenly, IT had a direct impact on business units. They needed IT’s direct involvement to achieve their business goals.
According to Gartner, about 50% of global organizations want to see an increase in Business-IT alignment and collaboration by 2022. They realize that collaboration is necessary to:
- Enhance customer experience
- Shorten time-to-market
- Improve resource utilization
- Provide better planning
Many companies understand the benefit of better alignment but grapple with how to achieve it. Part of the difficulty comes from how businesses approach alignment.
Some experts suggest a traditional approach that requires identifying business and IT goals, determining the misalignments, and then working to align them. Alignment for these experts involves communicating, evaluating, and validating the alignment process. Unfortunately, that process doesn’t address the fundamental obstacle to change — people.
Changing alignment means changing mindsets. Just as with digital transformation, success depends on the ability to change the corporate culture to accept an agile, customer-centric philosophy. Before trying to implement alignment initiatives, companies need to work on changing the culture.
What is Business-IT Alignment?
Alignment means arriving at a position of agreement or alliance. For IT and business units, achieving consensus is crucial to alignment. If the process is viewed as quantifiable, it’s easier to determine when alignment is achieved. For example, an existing marketing project required IT to create a form for the website. Marketing delivers the requirements; IT delivers a form; Marketing doesn’t like the form; IT adjusts the form, and the process continues until an acceptable form is complete. To quantify the alignment, calculate the cost in terms of time-to-delivery, time lost to multiple reiterations of the form, and any opportunity costs that may result from delayed delivery.
Compare the process when IT and Marketing form a collaborative team to develop the form. Marketing and IT can work together to refine the requirements for both groups. IT develops a minimum value version to review with Marketing. Adjustments are made, and the form is delivered. Perform the same calculations using the collaborative approach. Achieving an agreement at the start of the process will result in a deliverable that provides the customer with a better experience at a lower cost. Illustrating how alignment improved the end result in quantifiable terms makes it easier for both groups to see the benefit of collaboration. Finding ways to show how alignment results in superior outcomes makes an objective statement as to its validity.
How to Achieve Business-IT Alignment?
Organizations that focus on changing mindsets are more likely to achieve a lasting realignment of IT and business units. Identifying ways to quantify how that alignment contributes to corporate success reinforces its value. It’s hard to argue with data. Other steps to achieving alignment include:
- Focus on customer experience
- Find a common language
- Be transparent
- Use cross-functional teams
- Promote an inclusive culture
- Understand change
If the primary obstacle to change is people, then the focus should be on the human side of effecting change. The alignment will happen once people understand its value.
Focus on Customer Experience
Everyone should be working to improve the customer experience. By keeping goals directed towards the customer, companies can bypass traditional silos. For example, putting IT, sales, and marketing on a team to address a point of friction on the customer journey moves the focus away from silos and on to the customer. IT can champion the effort by creating multi-functional teams that focus on the customer, minimizing the opportunity for old attitudes to resurface.
Find a Common Language
Business and technical jargon are impediments to alignment. For example, the MTD data shows CPL is down, which means a better ROI on the CRM purchase. Translated, it means: the month-to-date data show that the cost per lead is down, making for a better return on investment on the customer relationship management system purchase. Not all jargon is technical.
At the same time, a statement such as the new RPA solution needs another API to help its AI component avoid GIGO has little meaning to someone from accounting. Although IT is often blamed for its technical jargon, both business and IT personnel need to remove field-specific language to allow for better communication. The more interaction individuals have outside their work bubble, the more likely they are to acquire common terms to facilitate understanding across silos.
Many companies have relied on business architecture and capability models to be the bridge between business and IT.
Decisions need to be transparent. When trying to change a mindset, transparency needs to begin at the top; however, that doesn’t mean ignoring the need for transparency at every level. A good test is to ask various team members why a certain decision was made. If they can’t identify the criteria used to make the decision, it wasn’t transparent. The openness in decision-making extends to poor decisions as well.
Sometimes, the results are not what was anticipated. Don’t try to spin the lackluster performance. Be transparent and use the opportunity to show others how to learn from mistakes. It’s crucial to illustrate to employees that failing is not a negative. If employees are going to change, they need to know that it is worth the risk. If risks are punished, people are afraid to risk change.
The more people work together, the more they learn about how others operate within the organization. The exposure helps breakdown stereotypes and encourages interdepartmental relationships. When creating teams, look to rotate employees through different teams. Maybe it’s as simple as having tech support staff work with helpdesk agents to see how the software is being used. They may find that a simple change on their end could make the workflow easier for the helpdesk.
By improving the workflow for the helpdesk, IT is also improving the customer experience. The change is no longer about why IT didn’t fix things sooner or why agents didn’t report it as a problem. The modification comes from focusing on the customer experience.
Take time to learn about how humans deal with change. For example, fear has a lot to do with resistance to change. Humans dislike the unknown. As companies begin to align IT and Business Teams, they need to involve the employees to help them understand what the change means. Using quantifiable alignment techniques is one way to show how alignment makes for company-wide success. Helping them become comfortable with risk by showing that failure is viewed as a learning opportunity. Most of all, explore different change management frameworks.
Find a Framework
Organizational change management techniques abound. Some use linear steps, and others work in cycles. The best method depends on the organization and its culture. Here are a few of the more popular methods:
- Kotter 8-Step Process
- McKinsey & Company Framework
- Kurt Lewin’s Change Framework
- ADKAR Framework
- The Kübler-Ross Model
- Satir Change Management
- William Bridges’ Transition Model
- Zachman Framework
Aligning IT and Business teams begins with understanding change. How do individuals react to change, and how can those reactions be mitigated? Then, look at how to shift employees’ mindsets to embrace a different way of looking at problem-solving. The change does not have to be corporate-wide. It can begin with IT’s efforts to build a better-aligned organization.
How do you manage the Business-IT alignment in your firm?