Serendipity is the fortunate discovery of something by chance. I had such an experience during a recent search through IDC's extensive technology library in North Sydney. While preparing an IDC perspective for an InTEP presentation on aligning IT to the business, I came across some quite startling research published by the Journal of Systems Management.
The research compared gains in productivity between white collar and blue collar workers over the last 30 years. This period coincides with the advent of the information age, and the results are not good news for IT. While blue collar productivity practically trebled over this period, white collar productivity grew by less than 10 per cent. That is not much return on investment for the billions of dollars spent on white collar computerisation over this period.
It may explain why Australian CIOs continue to rate the task of aligning IT with the business as one of the main challenges they face. In fact, since 1993 it has remained among the top three issues on CIO's agendas in IDC's "Forecast for Management" study. The challenge rated particularly highly by CIOs from the production and leisure sectors in the most recent survey.
Given this recognition, why does this remain a challenge for CIOs? A recent IDC study entitled "The Corporate Decision Process and IT Expenditures" may provide some insights.
The research disclosed that the usual catalyst for the investment is the identification of a business problem by senior-level executives. Often a committee is formed to tackle the problem with some representation from IS, which, in turn, may form a subcommittee to frame the technical specifications for the solution to the problem. This subcommittee will then generally seek input from end users in formulating these specifications. These end users and IS staff then evaluate options and present a solution to the original high level instigators of the project for sign-off.
What is clear from this model is how much major organisations rely on committees for IT decision making. It is noteworthy that the very industries where aligning IT with the business is a concern -- production and leisure -- are the most likely not to have an IT steering committee.
"Forecast for Management" showed that around 38 per cent of all respondents reported that their businesses did not have such an IT steering committee.
However, the figures for production and leisure industry respondents were 50 per cent and 60 per cent respectively. Furthermore, even when these sectors did have an IT steering committee, they were the least likely to contain representatives from either the CEO or end users.
Another concern from "Forecast for Management" was that these two industry sectors were the least likely to have an IT strategic plan. An examination of the IT decision making process indicates there is no real mystery to the challenge of aligning IT to the business. It is the role of executives to identify the problems facing their organisations and to articulate goals to overcome them. IS needs to be able to understand where technology can address these requirements and it needs the input of business users to ensure these solutions are appropriate.
It would seem that the underlying requirement to the whole process is the need for open channels of communication within organisations. The typical mechanism to facilitate this is through committees. If we are to improve the productivity for white collar workers, perhaps the real challenge facing CIOs is to ensure that their IT steering committee meetings represent time well spent for their business colleagues.
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