Alineando Las TI Con La Estrategia Del Negocio

8/21/2019 Alineando Las TI Con La Estrategia Del Negocio

1/8

ALIGNING

IT

WITH TIE BUSINESS

STRATEGY

ASSESSING

IT BUSINESS

ALIGNMENT

erry uftm n

Alignment is

the

perennial

business

chart-topper on top-ten lists

of IT issues.

What

foliows is

a

methodology developed by the author for assessing

a

company s

alignment Modeled after

the C apability M aturity

Model

developed

by Carnegie Mellon s Software

Engineering

Institute,

but focused

on

a

more strategic set

of business practices,

this

tool has been

successfully

tested

at more than 50 Global

2000 companies

and is currently the

subject

of a

benchmaricing

study

sponsored

by the

Society

for Information

Management and

The

Conference

Board. The

primary objective of

the assessment

is to identify specific recommendations

for improving

the

alignment

of IT and the

business.

UIGN1MENT

IS THE PERENNIAL

BtJSLNESS

chart-topper on

top-ten lists of IT

issues.

Educating

line

management

on technolo-

gy s

possibilities

and

limitations

is diffi-

cult; so is

setting IT

priorities for

projects,

developing

resources

and

skills, and integrat-

ing systems with corporate strategy.

It is even

tougher to

keep

business and IT

aligned as

business

strategies

and technology

evolve.

There

is

no

silver-bullet

solution,

but

achieving

alignment

is

possible.

A

decade

of

research has

found

that the

key is building the

right relation-

ships and processes,

and pioviding

the neces-

s ry trainiing.

What follows

is

a

methodology

developed

by the author for

assessing a company s align-

ment.

Modeled after the

Capability

Maturity

Model® developed

by

Carnegie

Mellon s

Soft-

ware

Engineering

Institute, but focused on

a

more strategic set

of business practices, this

tool

has

been

successfully tested

at more than

50

G;lobal 2000

companies and

is currently the

subject of

a benchmarking study

sponsored

by

the Society

for

Information

Management

and

The

Conference

Board. The primary

objective

of

the

assessment

is

to

identify specific recom-

mendations for improving

the

alignment

of

IT

and the

business.

ALIGNMENT CATEGORIES

The

tool

has

sLx IT-business alignment crit:eria,

or maturity

categories, that are included

in

each assessment:

L

2.

3

4.

5

6

Communications Maturity

Competency/Value

Measurements

Maturity

Covernance

Maturity

Partnership

Maturity

Technology

Scope Maturity

Skills

Maturitv

Each maturity

category is

discussed

below. A

tist

of

specific practices

for each of

the

six

alignment criteria can be found

in Exhibit 1.

ommunications

Maturity

Effective

exchange

of

ideas

and

a clear

under-

standing of what it takes to

ensure successful

strategies

are

high

on

the

list

of

enablers antd

in-

hibitors to

alignment. Too

often there is

little

business

awareness on the part of IT or

little IT

appreciation on the

part of the business.

(iiven

the

dynamic

environment

in

which most orga-

nizations find themselves, ensuring

ongoing

knowledge sharing across

organizations is par-

amount.

N FO RM

AT; O N SY ST E MYS

MA N A G

FM EN

FAlL

2003

JERRY

LUFTMAIN

is

professorat the Howe

School of

Technology

Management t

Stevens

Instituteof

Technology

in

hIoboken New Jersey.


2/8

LIGNING

ITWITH THE

BUSINESS STRATEGY

EXHIBIT

I Alignment

Criteria

Alignment

CrIterion.

Communications

Maturity

Level 1:

With Process

No

Alignment

Level 2:

Beginning

Process

Level 3:

Establishing

Process

Level 4:

Improved

Process

Level

5:

Optimal

Process

Complete

Alignment

IT management

lacks

understanding

Understanding

of IT

Managers lack

by Business

understanding

Organizational

Learning

Style

and Ease

of

Access

Leveraging

Intellectual

Assets

.T-Business

Liaison

Staff

IT

Metrics

Business Metrcs

Link between

ITand

Business

Metrics

Service

Level

Agreements

Benchmarking

Formally Assess

IT

Investrnents

Continuous

Improvement

Practices

Casual conversation

and

meetings

Limitea

understanding

by

IT

management

Limited

understanding

by

rmanagers

Newsletters,

reports,

group e-mail

Business to IT only;

One-way,

somewhat

formal

informal

d

hoc

None

or

use

only as

needed

Technical only

IT investments

rneasured rarely,

if

ever

Value of IT

investments rarely

measured

Use

sporadically

Seldom or never

Do not assess

None

Some

structured

sharing

emerging

Primary

IT Business

iink

Technical cost;

metrics

rarely

reviewed

Costlunit;

rareiy

reviewed

Good

understanding

by

IT

management

Good understanding

by managers

Training

departmental

meetings

Two-way,

forrnal

Structured

around

key processes

Facilitate

knowledge

transfer

Review, act

on

technical,

ROI

mnetrics

Review,

act on ROI,

cost

Business,

IT metrics

Business, IT

metrins

not linked

becoming linked

With units for

technology

performance

Sometimes

benchmark

informally

With units; becoming

enterprisewide

May

benchmark

formaily, seldom

ac t

Only

when there

is

a

Becoming a

routine

problem

occurrence

Few;

effectiveness

not

measured

Formai Business

Not done, or done

as

At

unit

functional

Strategy

Planning needed

level, slight IT

input

Formal IT

Strategy

Planning

Organizational

Structure

Reporting

Relationships

How

IT Is Budgeted

Rationale for iT

Spending

Not done, or done

as

needed

Centralized or

decentralized

CIO reports to OF

Cost center,

spending

is

unpredictable

Reduce costs

At

unit functional

level, light

business

input

Central/decentral:

some collocation

CtO reports to

CFO

Cost

center

by unit

Productivity,

efficiency

Few;

starting to

measure

effectiveness

Some IT input

and

cross-functional

planning

Sorne business

input

and cross-

functionai

planning

Central/decentral

or

Federal

CIO reports to

CO O

Some

projects

treated as

investments

Also a

process

enabler

Understanding

encouraged

among

IT staff

Understanding

encouraged

among

staff

Formal

methods

sponsored

by

senior

management

Two-way,

somewhat

informal,

Understancling

required

of

ali IT

staff

Understanding

required of staff

Learning

mon:tored

for effectiveness

Two-way,

informal

and

flexible

Formal sharing

at all Formal

sharing with

levels

partners

Facilitate

relationship

building

Also

measure

effectiveness

Also measure

customer

value

Formally linked;

reviewed

and

acted

upon

Enterprisewide

Routinely

benchmark,

usually

act

Routinety assess

and

act

on

findings

Many;

frequently

measure

effectiveness

At

unit and

enterprise,

with

IT

At

unit and

enterprise,

with

business

Federai

CIO

reports to

COO

or

CEO

IT treated

as

investment

Process drnver,

strategy

enabler

Building relationsnip

with

partners

Also

measure

business

ops. HR,

partners

Baianced

scorecard,

incIudes partners

Balanced

scorecard, includes

partners

Includes

partners

Routinely

bench mark,

act on ,

and

measure

results

Routinely

assess,

act on,

and

measure

results

Practices and

measures

well

established

With IT and

partners

With partners

Federal

CiO

reports

to

CE O

Profit center

Competitive

advantage,

profit

N

F R

P M

A

r

N S Y S T E M S M A N

A 2 E M F N

FA 2

03

Understanding

ot

Business

by

IT


3/8

ALIGNING IT

WITH THE

BUSINESS

STRATEGY

EXHI IT I

Alignment

Criteria (Continued)

Alignment

Criterion:

Communications

Maturity

Level 1:

With Process

No Alignment)

Level 2:

eginning

Process

Level 3:

Establishing

Process

Level 4:

Improved

Process

Level

5:

Optimal

Process

Complete

Alignment)

Senior-Level

IT

Steering

Comrmittee

How Projects

Are

Prioritized

Business

Perception

of

IT

.T s Role

in Strategic

Business Planning

Shared

Risks and

Rewards

Managing

the

IT Business

Relationship

Relationship/Trust

Style

Business

Sponsors/

Champions

Primary

Systems

Standards

Architectural

Integration

How

IT

Infrastructure

Is

Perceived

Innovative,

Entrepreneurial

Environment

Key IT HR Decisions

Made by:

Change

Readiness

Career Crossover

Opportunities

Cross-Functional

Training and Job

Rotation

Social Interaction

Attract

and

Retain

Top

Talent

Do

not

have

React to

business

or

IT

need

Cost

of doing

business

Not invoived

IT

takes

ail the risks,

receives

no

rewards

IT business

relationship

is

no t

managed

Conflict

and

mistrust

Usually none

Cost of

doing

business

Not involved

IT

takes all

the

risks, receives

no

rewards

IT-business

relationship is

not

managed

Discouraged

Top business

and iT

management

at

corporate

Tend

to

resist

change

Job transfers

rarely

occur

No opportunities

Meet informally

as

needed

Determined

by IT

function

Becoming

an

asset

Enables

business

processes

IT

takes

most risks

with little reward

Managed

on an

ad

ho basis

Transactional

relationship

Often

have a senior

IT sponsor or

champion

Becoming

an asset

Enables

business

processes

IT

takes

most

risks

with

little

reward

Managed

on

an

ho

basis

Somewhat

encouraged

at

unit

level

Same, with emerging

functional

influence

Change

readiness

programs

emerging

Occasionally

occur

within unit

Decided

by

units

Minimal

IT business Strictly a business-

interaction

only

relationship

No retention

program;

poor

recruiting

IT

hiring

focused on

technical

skills

Formal committees

meet regularly

Determined by

business function

Enables future

business

activity

Drives

business

processes

IT,

business start

sharing

risks,

rewards

Processes

exist bu t

not always

followed

IT

becoming

a

valued service

provider

IT

and business

sponsor or

champion at

unit

level

Enabies future

business

activity

Drives business

processes

IT,

business start

sharing risks,

rewards

Proven

to be

effective

Mutually determined

Drives future

business

activity

Enables

or drives

business strategy

Risks,

rewards

always shared

Processes

exist

and

complied

with

Long-term

partnership

Business

sponsor or

champion at

corporate level

Drives future

business activity

Enables or

drives

business

strategy

Risks, rewards

aiways

shared

Processes exist but

Processes exist

and

not always

followed are

complied with

Strongly

encouraged Also at

corporate

at unit level

level

Top

business and

unit management;

IT advises

Top

business

and IT

management

across

firm

Also

includes

external partner3

Partners

priorities

are

considered

Partner with

business in

creating value

IT, business adapt

quickly to change

Managers

incenteJ

to take

risks

Processes are

continuously

improved

Partner,

trusted

vendor

or

IT

services

CEO

is

the

business

sponsor

or

champion

Partner with

business in

creating

value

IT,

business

adapi

quickly to change

Managers incented

to take risks

Processes are

continuously

improved

Also

with partners

Top

management

across firm and

partners

Programs

in place

at

Programs

in place

at

Also proactive

an

d

functional level

corporate level

anticipate change

Regularly

occur

for

unit

management

Regularly occurat

all

Also

at

corporate

unit

levels

level

Formal programs

run Aiso

across

by

all

units

enterprise

Trust

and

confidence

Trust and confidence

is

starting

achieved

Technology

and

business focus;

retention

program

Formal

program for

hiring and

retaining

Also with

partner;

Attained

with

customers and

partners

Effective

program

for

hiring

and

retairning

INFORMAThON

SYLTEMS

MANAGEMENT

INFO

RPM

AT IO N SYST

E MS

MAN

A G

E M ENT

F

A[.L L

2003O3


4/8

LIGNING

ITWITH

THE BUSINESS

STR TEGY

Many

finns choose

to

draw on

liaisons

to

fa-

cilitate

this

knowledge

sharing.

The

keyword

here

is facilitate.'

This

author has

often seen

facilitators

whose

role

becomes

serving

as the

sole

conduit

for interaction

among

the

differ-

ent

organizations.This

approach

tends

to stifle,

rather

than

foster,

effective

communications.

Rigid

protocols

that

impede

discussions

and

the

sharing of

ideas

should be

avoided.

Competency/Value

Measurements

Maturity

Too many

IT

organizations cannot

demonstrate

their

value

to the

business

in terms

that

the

business

understands.

Frequently,

business

and

IT

metrics

of

v-alue differ.

A

balanced 'dash-

board that

diemonstrates

th-e

value of

If

in

terms

of contribution

to the

business

is needed.

Service

levels that

assess

If s commitments

to the

business

often

help. However,

the

ser-

vice levels

must

be expressed

in terms

that

the

business

understands

and

accepts.The

service

levels

should be

tied to

criteria that

clearly de-

fine the

rewards

and penalties

for suwpassing,

or

missing, the

objectives.

Frequently,

organizations devote

significant

resotrces

to measuring

performance

factors.

However,

they

spend

miuch

less of

their re-

sources on taking

action

based on these

mea-

surements. For

example,

reqjuiring

a return

on

investmnent

(ROD)

before a project

begins, but

not

reviewing

hlow

well objectives

were

met

af-

ter

the

project

was

deploved, provides

little

value

to the

organization.

It

is

important

to

continuously

assess

the performance

metrics

criteria

to understand

(1) the factors

that

lead

to

missing the

criteria

and (2)

what

can

be

learned

to imaprove

the

environment.

Governance

Maturity

The

considerations

for IT

governance

include,

how the

authoritv

for resoturces,

risk,

conflict

resolution,

and

responsibility

for

IT

is shared

among businiess

partners,

IT inanagemnent,

and

service

providers. Project selection

and priori-

tization issues

are includted

here.

Ensuring

that

the appropriate

business anid

IT participants

formally

discuss and review

the priorities

andJ

allocation

of IT

resources

is aimong

the

most

important

enablers

(or

inlhbitors)

of

align-

ment.This

decision-making

authority

needs

to

be clearly

defined,

Partnership

Maturity

The relationship that

exists

among the

business

and IT

organizationis

is another

criterion

that

ranks

high

among the

enablers

and

iihibitors

of alignment.

Giving

the

IT function the

oppor

tuanity

to have

an eqLual

role

in

defining

business

strategies

is

obviously

important.

However,

how

e-ach

organization

perceives

the contribu-

tion of the

other,

the trsust that

develops

among

the

participanits,

ensuring

appropriate

businiess

sponsors

and chamupions

of

IT endeavors,

and

the

sharing of

risks and

rewards

are all

major

contributors

to mature

alignment.This

partner-

ship

should evolve

to

a point

wlhere

IT

both

en

ables

and drives

changes to

both

business

processes

and

business

strategies.

Naturally,

this demancds

having

a clearly

defined

vision

shared

bv the CIO

and

CEO.

Technolagy

Scope

Maturity

This

set

of criteria

assesses

the extent

to

which

IT is

able to:

]

Go beyotnd

the

back

office

and

the front

office

of

the

organization

LIAssunme

a

role

suipporting

a flexible

infra-

structure

that

is

transparent

to

all business

partners

anid

customers

[ Evaluate

and

apply emerging

technologies

effectively

i

Enable or

drive

bulsiness

processes

and strat-

egies

as a true

standard

L

Provide

solutions

customizable

to

customier

needs

Skills

Maturity

This

category

encompasses

all IT

huaman re-

source

considerations.

such as

how

to hire and

fire, motivate,

train

and educate,

and

culture.

(icing

beyond

the

traditional

considerations

such as

training,

salary, performance

feedback

and career

opportunities,

there

are

factors that

include the

organization's

cultural

andi

social

environment.

For example,

is

the

organization

readv for change

in this

dynamic environment?

Do

individuals feel

personally

responsible

for

business

innovation?

Can

individuals

and

orga-

nizations learn quickly from

their

experience?

Does

the organization

leverage innovative

ideas

and the

spirit of entrepreneurshp?

These

are some of

the important

conditions

of mature

organizations.

LEVELS

O

ALIGNMENT

MATURITY

Eachi of

the

six criteria

described

anove

has

a

set

of

attributes

that

allow

particsular

dimen-

sions ( orpractices)

to

be assessed using

a

rating

schem-ne

of five

levels.

For example,

for the prac-

tice

Understanding of

business by if uider

the

I

N F C

iNAA I N

S Y S I

S

NAA N

A

,

F M

f

N T

F A I

1 2

olg

beyond

the

traditional

considerations

aire factors

that

include

the

oreranization

cultural

and

Social

environnment


5/8

LIGNING

IT

WITH THE

BUSINESS STR TEGY

Communications Maturity criterion,

the five

levels

are:

Each

description corresponds to a

level of

alignment, of which there are

five:

Level

1: IT management lacks understanding

Level

2: Lilnited

understanding

by IT1manage-

ment

Level 3: Good understanding

by

IT

manage-

ment

Level

4:

Understanding

encouraged

among IT

staff

Level 5: Understanding required of

all IT staff

It

is important

to

have

both business

and

IT executives evaluate

each of

the

practices

for

the

six

maturity

criteria.Typically,

the

initial re-

view

will

produce

divergent

results, and this

outcome

is indicative

of

the organization's

alignment problems and opportunities being

addressed.

The objective

is

for

the team of IT

and business

executives

to

converge

on

a

matu-

rity level.

Further,

the

relative inportance

of

each of

the attributes for each maturity criterion

may

differ

among

organizations. For example,

in

some organizations, the use

of SLAs (service

level agreements), which

is a

practice

under

the Competency/Value Measurements

Maturity

criterion,

may

not be considered

as

important

to alignment

as the effectiveness of

IT-busi-

ness

liaisons,

which

is

a

practice under the

Communications Matirity

criterion.

Assigning

the SLA

practice a

low maturity

assessment

should not

significantly

impact the

overall rat-

ing.

However, it is still valuable

for the assess-

ment teanm to discuss

why

a particular

attribute

(in this example, SLAs) is

less

significant

than

another attribute (liaisons).

After

each practice is

assessed,

an

average

score for the

evaluation team is calculated for

each practice, and then

an average

category

score

is

determined

for each of the six criteria

(see Exhibit 2). The

evaluation team

then

uses

these scores for each criterion

to converge on

an

overall assessment of

the

IT

alignment matu-

rity level for

the firm

(see below). The

next

higher

level

of maturity

is then used as a road-

map to

identify

what the

firm

should

do next.

A

trained facilitator

is typically needed for

these

sessions.

SSESSING YOUR

ORG NIZ TION

This

rating

system

will

help you

assess your

company's

level

of

alignment. You

will

ulti-

mately

decide

which of the

following

defini-

tions

best describes

your

business practices.

Level

1

Without Process (no alignment)

Level 2

Beginning

Process

Level

3: Establishing Process

Level

4: Improved Process

Level

5:

Optimal Process (complete alignment)

Level

1

companies lack the

processes and

com-

munication needed to

attain

alignment. In

Lev-

el

5 companies, IT

and

other

busi

ness

functions (marketing, finance, Rl D, etc.) adapt

their

strategies

together,

using fully developed

processes that include extemal

partners and

customers. Organizations should seek

to

attain,

and

sustain, the fifth and highest level

of align-

ment.

Conducting

an

assessment

has

the

follow-

ing four steps:

1 Form

the assessment

team.

Create

a

team

of IT and business executives

to

perform

the

assessment.Ten

to

thirty executives typ-

ically

participate,

depending on whether

a

single

business unit

or the entire enterprise

is being assessed.

2

ather information.

Team

members

should assess each of

the

38 alignmient

practices and

determine which

level, i

rom

1

to 5, best

matches their organization (see

Exhibit

1).This

can be done in three wrays:

(1) in a

facilitated

group setting,

(2)

by

hav-

ing each

member

complete a

survey

and

then

meeting to discuss the results, or

(3 )

by combining

the

two approaches (e.g., in

situations where

it is

not

possible fo,r all

group members to meet).

3. Decide on individual

scores.

The 1.eamn

agrees on a score

for each practice. The

most

valuable

part of

the assessment is

not

the score, but understanding

its implica-

tions

for

the

entire company and what

needs

to

be

done to

improve

it.

An

average

of

the practice

scores

is

used to deter

-nine

a category score for each of the

six

criteria

(see

Exhibit 2).

4.

Decide

on

an ovlerall

alignmentscore.The

team reaches consensus on what overall

level

to

assign

the organization.Aver.ging

the category scores accomplishes

this,

but

having dialogue

among

the participants

is

extremely valuable.

For example, some

companies adjust the alignment score

because they give more weight to particu-

lar

practices.

NFORMATI

O

SYST ZMS

MANAGEMENT

F

A

*

L

2

0 0 3

WArganizations

should

seek

to

attain and

sustain the fifth

and highest

level

of alignment.


6/8

LIGNING

IT

WITH

THE

BUSINESS STR TEGY

EXHIBIT

2 Tally Sheet

Practice

Categories

Pr

Communications

Competency/

Value

Measurements

Governance

Partnership

Technoiogy

Scope

Skills

2

3

4

5

6

8

9

10

11

12

13

14

is

16

17

18

19

20

21

23

24

25

26

27

28

29

30

31

32

33

34

35

36

37

38

actices

Understanding of business

by

IT

Understanding

of IT by

business

Organizational learning

Style and ease

of access

Leveraging

intellectual

assets

IT-business liaison

sta-f

IT

metrics

Business metrics

Link

between

iT

and

business

metrics

Service

level

agreements

Benchmarking

Forrrmally

assess

IT nvestments

Continuous

improvernent

practices

Formal

business strategy

planning

Formal

iT strategy

planning

Organizational

structure

Reporting relationships

How

IT is budgeted

Rationaie

for

ITspending

Senior-level

IT

steering

committee

How projects

are prioritized

Business perception

of

IT

IT s role

in strategic

business planning

Shared

risks and rewards

Managing

the IT-business relationship

Relationship/trust

style

Business

sponsors/champions

Primary

systems

Standards

Architectural

integration

How

IT

infrastructure

is

perceived

Innovative, entrepreneurial

environment

Key

IT

HR decisions

made by:

Change

readiness

Career

crossover opportunities

Cross-functional

training and

job rotation

Social interaction

Attract

and

retain

top talent

Your

Alignment

Score.

I N

F

R AT

CN SYFS T EM

S MVAN G E

M N

F

A L L 2 )

3

Averaged

Scores

1

1 5

2 2 5

3

3.5

4 4 5

5

Average

Catgory

Score


7/8

LIGNING

IT

WITH

THE

BUSINESS

STR TEGY

The overall alignment

score can be

used as

a benchmarking

aid to compare

with

other

or-

ganizations.

Global 1000

executives who

have

used

this tool

for the first time have

rated

their

organizations,

on

average

at

Level

2 (Begin-

ning Process), although

they

typically score

at

Level

3

for a few

alignment

practices.

CONCLUSION

Achieving

and sustaining

IT-business

align-

ment continues to

be

a

major issue. Experience

shows

that no

single

activity

will enable

a firm

to attain

and sustain alignment.

There

are

too

many

variables.

The technology and

business

environments

are too

dynamic.

The

strategic

alignment maturity

assess-

ment tool

provides

a vehicle

to evaluate

whlere

an organization

is,

and

where

it needs to go,

to

attain

and sustain business-IT

alignment.

The

careful assessment

of a

firm s IT-business align-

ment

maturity

is an

important

step

in

identify-

ing

the

specific actions necessary

to ensure

that IT is being

used to appropriately

enable

or

drive the

business strategy.

Note

1.

See also Jerry

Lufftan,

editor, Comnpeting

ir the

InformationAge.Align

in the

Sand

Oxfor d

University

Press,

2003; and

Jerry Luftman

Managing

tbe [T

Resource

Prentice

Hall,

2:003.

IN

FO PM T IO N

SYS T E MS

M N AC; E M

EN

T

F

A

LL 2


8/8

COPYRIGHT INFORMATION

TITLE: Assessing IT/Business Alignment

SOURCE: Inf Syst Manage 20 no4 Fall 2003

WN: 0328802780001

The magazine publisher is the copyright holder of this article and it

is reproduced with permission. Further reproduction of this article in

violation of the copyright is prohibited. To contact the publisher:

http://www.auerbach-publications.com/

Copyright 1982-2003 The H.W. Wilson Company. All rights reserved.

Alineando Las TI Con La Estrategia Del Negocio

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