Aligning IT with the business
When Nicholas Carr published his May 2003 Harvard Business Review article questioning the value of IT (
http://www.nicholasgcarr.com/articles/matter.html), it was greeted with much hand-wringing and voluble protest from the IT vendor community. Whilst questions can be raised about the validity of some of his arguments – not least the fact that it's how the I(nformation) and the T(echnology) of IT are combined that DOES matter – there can be little doubt that the hypothesis at the heart of his article resonated in countless boardrooms. Survey after survey of business leaders sees them questioning the value of their IT investments. Equally, business leaders want to see more of their IT investments targeted at business innovation and less at maintaining the IT status quo.
This business-IT disconnect is nothing new. In the halcyon days of the mainframe era when IT was firmly in control, the business suffered with an inflexible IT resource - and an expensive one at that. The advent of client/server and distributed systems allowed the business to wrench back control but at the cost of a proliferation of poorly integrated, heterogeneous technology which is fragile and increasingly costly to maintain.
The consequences of this flip-flopping of control are all too apparent: the business demands innovation, whilst IT struggles to simply maintain what it’s already got; IT resource utilisation is sub-optimal and there’s significant redundant capacity; investment in ‘quick fix’ solutions exacerbates inflexibility; and outsourcing is seen as a route to cost saving.
The post-dot.com hangover has all but abated and IT budgets are growing (albeit at - most would say more realistic - low single digit rates). However, unlike the teenage binge drinker, lessons have been learned. IT investments are now subject to far greater scrutiny. It is now incumbent upon the IT organisation to demonstrate that IT investment will impact the bottom line – and then to show how it has.
This has not been lost on the vendor community. Business-IT alignment is becoming an increasingly common mantra which permeates their strategies – whether those strategies are dressed up in words like “On Demand”, “Adaptive Enterprise”, “Business Technology Optimization”, “Dynamic Systems Initiative”, or something else similar. If you scrape away the marketing veneer, the common technology picture which emerges, combines the benefits of the two phases of control which got us to this point in the first place: the scalability, reliability, security and manageability of the mainframe era; with the openness and flexibility of a highly distributed environment. This is what we refer to as the “next-generation data centre”.
The “next-generation data centre” technology concept demands the convergence of enabling application lifecycle, integration and management technologies; and shifts the value of technology tools increasingly away from features and functions, towards simplification and integration – which, interestingly, offers both opportunities and challenges for the largest IT suppliers. They have the potential to exert an ever-stronger grip over IT procurement choice – if they can get their own product lines in order.
As an IT user,exploiting this concept requires a new approach to IT investment and deployment, which targets technology complexity and promotes common understanding of the key issues and priorities at the interface between business and IT. The hyperbole which surrounds service-oriented architecture (SOA) and web services could imply that we already have the makings of this new approach. The truth, though, is that while they are certainly important components, by no means do they provide the complete picture.
Business-IT alignment, enabled by the “next-generation data centre” and a way of thinking “end to end” about IT issues which we refer to as “enterprise architecture”, demands a new way of thinking from IT suppliers and their customers. That new thinking must be informed by a new type of advice: one which focuses on the convergence of enabling technologies, rather than the technologies themselves, and is delivered in the context of an architecture framework which unites the worlds of business and IT. That’s why we formed Macehiter Ward-Dutton.
