Business executives have high expectations of technology — but lower confidence on IT delivering capabilities towards these expectations. This is the “new” business technology alignment gap — a gap between expectations for technology and confidence in the IT organization.
CIOs are facing marginalization. CEOs continue to treat IT as a cost center, as they don’t see IT as a proactive source for business improvement or innovation.
This is not new, I’m afraid. CIOs are marginalizing themselves since quite a long time.
On the other hand, I think IT is doing a great job in managing IT operations and aligning investment budgets with business organizations and strategies. But CIOs have done very little to drive business results, manage IT operations’ relationship with the business, or help drive technology-based business innovation.
On top, there is a general feeling that IT has a natural tendency toward adding unnecessary complexity in the form of duplicate assets, multiple processes to achieve the same ends, or overlapping organizational responsibilities. Unnecessary complexity adds to IT costs and risks and reduces its effectiveness. The only sustainable remedy against these failings is to strategically apply disciplined consolidations, focusing on their business value and long-term impact on IT.
To make things a bit worse, emerging business technology will bring even greater demand for technology-based business results and innovation.
CIOs who don’t invest in overall IT excellence will find themselves relegated to the IT “kitchen” while business executives take on the technology-based innovation role.
A new business-technology-as-a-service (BTaaS) model enables IT to get more involved with business innovation and less with pushing the IT machinery. BTaaS establishes a strategic framework for value delivery around business technology services.
While ITIL v3 defines its foundation, the IT-as-a-service (ITaaS) concept provides its model. The adoption of BTaaS will require IT to evolve into a business technology management (BTM) function responsible for governing the firm’s relationships with its surrounding ecosystem ofxternal and internal IT suppliers and manage it as a portfolio of BT services.
Firms adopting the BTaaS model will gradually replace their traditional infrastructure support approach to technology with one based on managed BT services, focusing their retained BTM organizations on governing their BT ecosystems.
CIOs should view the HBS (Harvard Business School) primary practices as the business basics for aligning demand and service management:
1-Develop your IT strategy using service archetypes to meet multiple business needs.
2-Commission execution to service providers committed to the business’ needs.
3-Create a service-oriented structure that can right-size service delivery by archetype.
4-Link individual and team rewards to the performance of the services they manage.