For years, there has been a recurring assertion of the need for the alignment of IT with business. The IDC paper, The CIO's Guide to Aligning IT Strategy with the Business, asserts that aligning IT strategies with business strategies has been a mantra for CIOs for quite a few years. The same paper also acknowledges that despite the apparent straightforward nature of the endeavour, many CIOs struggle to achieve that alignment.
IDC says the rapid rise of digital technologies and transformation has significantly raised the bar — now, CIOs must find synergies and multiplier effects, not just business alignment, and that has a big impact on the creation of IT strategies.
Easier said than done
There was a time when CIOs and the IT team would label employees using company IT systems as ‘customers.’ This approach is wrong and undermines any effort to align IT with business. James Anderson, a vice president and analyst at Gartner, says there is no such thing as IT and the business. “The business includes IT. And your product is not IT, it’s the services enabled by IT that are used for business outcomes,” he argues.
Dave West, president for Cisco Asia Pacific, Japan and Greater China, says an integrated IT and business strategy involves the alignment of multiple aspects beyond just the IT infrastructure. He suggests that companies look at the allocation of capital, prioritising investments, hiring the right talent, and considering market dynamics.
“Companies need to understand areas such as artificial intelligence, data privacy, cybersecurity, and sustainability, all of which are evolving rapidly. All these areas have an IT and business strategy aspect to them.”
Dave West
“Given that many companies have traditionally treated these are separate divisions, an alignment has not always been easy to achieve. However, things are starting to change as companies realise the intertwined nature and impact of these areas,” he added.
Risks of continued misalignment
Leslie Joseph, a principal analyst at Forrester, contends that a misalignment between IT and business may result in significant risks such as strategic misdirection, underutilization of technology, compromised customer experience, and decreased market competitiveness.
He also contends that a disconnect in understanding and communication between IT and business stakeholders leads to ineffective digital transformation or worse, severely reduced effectiveness of digital transformation investments.
For Cisco’s West, the biggest risk is loss of competitive advantage which will ultimately derail any growth objectives. That will be detrimental to their growth. He also noted that the cybersecurity landscape constantly changing, and new threats present an ongoing challenge for organisations.
“Security resilience is critical to withstand unforeseen threats and navigate the day-to-day shifts in an evolving digital landscape. For companies to build this resilience, it is critical to have alignment in IT and business strategies,” he added.
Alignment to accelerate technology integration in workflows
Gartner analysts concede that defining, measuring and communicating the business value of IT is challenging for many CIOs. In the Gartner report, The 9 Rules for Demonstrating the Business Value of IT, VP analyst Robert Naegle says CIOs should focus on “above the line” metrics that matter to executives — not “below the line” operational performance metrics — by telling a story that matters to business outcomes.
West says an integrated IT and business strategy greatly simplifies the decision-making process by empowering organisations to make informed choices and ultimately enables them to achieve their overall goals and objectives.
Ricky Kapur, head of Asia Pacific at Zoom, predicts that 2024 will continue to see a platform-first approach that enables the smooth transition between channels, be it video, voice or chatbots.
He opines that this strategic direction empowers enterprises to enhance customer experiences, resulting in improved business outcomes and driving transformative changes across the industry.
“By harnessing the power of AI, sales tools specifically designed to forecast, track, and analyse work performance equip customer-facing employees to prioritise the delivery of exceptional service and foster unwavering customer loyalty.”
Ricky Kapur
He suggests that as organisations evaluate the implementation of AI solutions, it is imperative to first be discerning and ensure that these solutions align with larger business objectives. “Moreover, it is essential to ensure that the benefits of AI are accessible to all employees. Lastly, swift and efficient deployment of these solutions is crucial to gain a competitive edge in the market,” he added.
Hurdles to alignment
Forrester’s Joseph acknowledges that aligning IT and business strategies has proven challenging due to several factors, including the traditional view of IT as a utility rather than a strategic partner, evolving roles of CIOs who must bridge the gap between operational and strategic perspectives, and the necessity to align technology initiatives with business goals for growth and customer value.
“This process requires proactive partnerships between CIOs and CEOs, a focus on innovation, security, and resilience, and effective communication of the value of IT initiatives and partnerships to align with broader organisational objectives and enhance revenue growth."
Lester Joseph
Making the case for alignment
West opined that businesses today are operating in a hybrid, multi-cloud, app-centric, and AI-driven world where consumers are demanding everything literally at the tip of their fingers. “By aligning IT and business strategies, companies can harness the power of emerging technologies to stay ahead of the competition and deliver business outcomes,” he added.
West further posited that companies could leverage advancements in areas like observability to ensure that not only does their technology work seamlessly across the organisation but can also anticipate and prevent any issues before they impact the end users.
“That seamless and delightful user experience will be a critical factor that differentiates good companies from great ones in the digital-first landscape,” he added.
For his part, Kapur believed that aligning business and IT strategies would help empower employees by creating an optimal work environment that allows them to feel most productive, collaborative and included.
“This could be as simple as offering automated translation and transcription to help teams across geographies collaborate better or incorporating AI to automate manual and repetitive tasks. These empower teams for greater creativity and collaboration, allowing them to focus on improving CX outcomes for customers,” he surmised.
