One of the most overused terms I've heard in the past few years as CEO of an IT consulting and staffing firm has to be the word "alignment." Think about it. How many times have you heard phrases like, "IT must learn to align with the business" or that "smart CIOs know that in order to succeed, IT must align with the business"?
Not only are these phrases overused and condescending (the implication that CIOs lack business smarts or proper business education, that is), they are also statements with which I wholeheartedly disagree. If you are merely aligning with the business, you are not doing enough. IT drives efficiencies. IT enables business. IT powers business success. The goal is not merely to align, but to get in front of the business goals and spearhead growth through next generation products and customer service.
By its very definition, "align" means to fall in line. To get behind. It suggests that the business sets the pace. It sets the strategy. In aligning, IT must fall directly behind, and keep pace with, the business.
Why it Matters
Traditionally, the alignment discussion comes up in one of two ways. Either, we're discussing corporate respect and reporting structures within an organization -- the IT department's lack of leadership representation or a "seat at the table" -- or we're discussing the common view that IT is merely a "cost center." While I am not suggesting that these problems and perceptions will instantly disappear, the shift in mindset can happen if you understand its scope and take the lead in making the necessary changes.
If Not Alignment, Then What?
IT does drive and enable business. It's time for IT leadership to drive that point home. Many of our clients get this. One of our insurance clients, for example, proudly touts IT's efforts in developing its mobile app development. IT rallied others to join them in their efforts during Hurricane Katrina to issue real-time checks and to deliver much-needed funds to those most critically in need. In this case, IT led the effort. IT delivered the technology. The business grew stronger and benefited from this leadership.
In another case, our financial services client's IT group developed a cutting edge analytics product to use in-house. With what seemed initially valuable as an in-house tool alone, is now a leading value-added offering to the bank's clients. In both instances, there is no talk of leveraging IT to merely "keep the lights on," and no one talks about IT in raw Selling, General & Administrative Expense (SG&A) numbers. IT leadership has a seat at the table, and the top layer of IT management knows how to drive innovation from their teams.
These examples of innovation and IT-generated efficiencies are likely the reason most of your staff went into IT in the first place -- the idea that there is a better, faster, more efficient way of doing things, and that IT can make that happen. Yet, somewhere along the way we lost track of this connection and reduced their influence.
CIO Benny Kirsh takes issue with what he sees as semantics, noting the "fine line between 'aligning with' and 'driving' business." Nevertheless, he has always led forward-thinking, innovative IT teams. During his tenure as CIO at Kyphon, IT drove the implementation of a quality assurance system assuring compliance to FDA regulatory requirements. The initiative reduced time-to-close complaints by 35 per cent and increased on-time user training from 55 per cent to 97 per cent. The implementation included automated documentation and version control, providing a compliant working environment leading to minor discrepancies during FDA audits. Under his watch, the business was able to increase sales and reduce costly FDA responses. Call it alignment, call it driving business -- Kirsh doesn't pay much mind to what you call it. "IT must be proactive and come up with great ideas on how to generate more revenue or make processes more efficient to impact the bottom line."
Embrace Organic Innovation
An overlooked reality is where true innovation is often born. For some, an expensive marketing or R&D budget precedes innovation. Groups of thought leaders spend months, sometimes years, planning versions 2.0 and beyond. But in most cases, innovation is born from necessity.
One of our retail clients reflects back just a few years on the organization's business-led approach to e-commerce. The company's leadership assumed successful sales of its items -- mostly furniture and higher-end appliances -- were almost exclusively dependent upon its extensive network of brick and mortar retail stores, with second-tier marketing support coming from its physical catalogs. Management realized that an online catalog was a minimum expectation for mid-to-large retailers. They operated in a mode that viewed e-commerce as a third-tier support function for the brick and mortar operations. The IT team was charged with meeting that minimum expectation with limited budget and resources. The e-commerce/IT team maximized their resources to create an attractive, user-friendly online catalog. Then, something interesting happened...Following the "if you build it, they will come" model, online sales grew to 50 per cent of the company's total annual revenues.
Creating a Culture of IT Innovation
True leaders are bold and take risks. In order to develop this culture of innovation within your IT organization, you must put yourself out there with the rest of the business. Sell your ideas for innovation, then execute. After even a single small win, it will be easier to continually steer these innovative ideas up the organizational ladder. Reward creativity. But, most importantly, market your accomplishments. Positive PR will spur additional creativity, one win at a time.
CIO and Portfolio Strategist Gene Irvine believes that IT must be made a part of the business. He urges his peers to allow their teams time to play with new technologies. Provide time for white-boarding sessions. Calculate it into budgets. If IT is not keeping up on technology or given the time to read, all they become are "droids" or task doers. He considers it a leadership requirement to provide a workplace that fosters business idea generation.
It is leadership's responsibility to make sure everyone in the organization knows about the business; what's going on. This does encourage people to think outside of the box in bringing forward suggestions. Sometimes it's as simple as tasking someone to go work with the biz user to fix a problem. They may hear 10 more problems. Brainstorm with the business to make this relationship stronger, Irvine suggests. Consider upstream and downstream implications.
But, he cautions, you don't need money to reward/encourage innovation. Awards, praise and recognition are always effective. Ask business leaders to pop in at a staff meeting from time to time. Importantly, implement. Be open to innovation.
And next time you hear someone say that IT needs to align with the business, I hope you can tell them how IT is driving your business forward.
Marilyn Weinstein is founder and CEO of IT Consulting and Staffing firm Vivo, Inc. For more information, visit www.vivoinc.com.