Tag Archives: Business Relationship Management

Leadership, Service Management

CEOs want tech results, not tech talk – Here’s how to deliver

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While many CEOs know that the use of technology is crucial for business success, what they don’t know or understand how technology use contributes to that success.

According to this CIO.com article, CIOs reported that less than 2% of their CEO bosses understood the totality of the technology stack.

And in today’s $24 trillion global digital economy, that is a problem.

The right technology solutions can enable competitive differentiation for any organization. But organizations need to have the right skills and mindset in place to enable, support, and deliver that differentiation.

Investments in technology is expensive – a wrong decision can cost an organization significantly. Those poor decisions can often be traced to the lack of an integrated business and technology strategy. In some cases, the IT strategy is developed separately from business strategy .  IT doesn’t help itself either – how can CEOs decide where to make investments in technology when IT proposals discuss technology benefits, such as uptime or features, rather than business results like growth, margin, or customer experience?

According to this McKinsey article , many CEOs struggle to understand exactly how IT initiatives and investments drive revenue, customer experience, and efficiency. As a result, IT looks like a cost center. But more than that, projects and investments in technology often become fragmented and underused, resulting in missed opportunities for new products, services, or operating models. One need look no further than the well-documented technology “misses” of companies like Kodak, Blockbuster, and Nokia.

Good service management is the solution

Good service management can solve the technology understanding gap between CEOs and CIOs. But many CIOs often think “we’ve tried that and it didn’t solve this problem.”

But did those organizations really implement good service management? Good service management is not just standing up a service desk and installing a ticketing and workflow tools. Good service management is not just utilizing service management practices to manage IT.  Good service management facilitates value realization and business results.

Think about it. Without alignment and integration with the rest of the organization, the IT organization cannot deliver the value and results expected from investments in technology. And this is exactly what good service management does. Good service management is much more than just implementing some tool and standing up a service desk. Good service management requires a holistic view of how technology enables value realization and business results.

Good service management starts with (I’ve said it before) alignment of IT with business goals. Adopting practices like portfolio management, business analysis, relationship management, and strategy management prevents implementation of “technology for technology’s sake” (like rushing to adopt AI-enabled capabilities for example), helps prioritize technology investments and IT efforts based on business impact.  Doing this will give CEOs insights into how technology enables return on investment and delivers business results.

But adoption of these practices only establishes the needed scaffolding for enabling and delivering the business value and results expected by the CEO from investments in technology.

McKinsey suggests two actions that every CIO must take with CEOs to close the understanding gap. Coincidentally, these two actions are foundational for good service management.

  • Meet with the CEO to clarify business outcomes, not technology. Identify and agree on 3-5 business outcomes where technology much help (such as growth, risk, customer experience) and capture these outcomes as plain, non-technical language statements.
  • Map IT to these outcomes by creating simple, one-page views that link business goal to technology capabilities to 2-3 simple measures that the CEO can track.

These two actions will have the following impact on service management and IT:

  • Identifies the right success measures for IT. Many IT organizations measure success in terms of technology (uptime, time to resolve, volume of tickets); measures that are meaningless outside of the IT organization. IT success should be measured and reported to the CEO in terms of business results – reduced waste, customer experience, and business growth.
  • Shifts the perception of IT as being a “cost center” to a “value enabler” by providing the CEO with regular visibility into how IT is enabling business outcomes.

Three things you can do now to help the CEO

  • Build better business relationships. Often the only interactions between IT and other business colleagues is limited to project meetings or interactions with a service desk professional. If you are an IT professional, when is the last time you met a colleague outside of IT for coffee to talk about how technology helps – or gets in the way of – doing work and delivering business results? These meetings will provide huge insights into how technology is perceived within the organization.
  • Define services in terms of business processes and outcomes. Stop putting off or ignoring this task. Services facilitate the realization of business results. The more the IT organization defines services in terms of business processes and outcomes, the less the IT organization will be perceived as a “cost center” and barrier to getting work done.
  • Start reporting the right things in the right way. Stop reporting metrics outside of IT that have no meaning to anyone outside of IT. Start reporting metrics like reliability and cost avoidance that are related to business objectives.

Technology doesn’t drive success – understanding how it enables success does. CEOs and CIOs who close that gap through strong service management transform IT from a misunderstood cost center into a true value enabler.

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Service Management

Business-IT Alignment isn’t a 50-50 Deal

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More and more companies are transforming via digital transformation and discovering new lines of business or radically changing their existing business models through the use of technology.  What does this mean?  It means that IT and the business have no choice but to become aligned if they want to succeed.

It’s no longer just “nice to have” alignment between business and IT. If the IT organization isn’t aligned with the business, the business will go around IT to make their initiatives happen — and that can have catastrophic consequences for everyone. 

It’s one thing to have a meeting with both the business and IT in the room and claim that you’re aligned.  But the realities of what alignment looks like and what it really means for IT and the business is more complex than simply adding IT to meeting agendas. 

What does it mean for the business and IT to be aligned? Who’s responsible for creating that alignment?

From Service Provider to Solution Provider 

According to Tim Winders, Vice-Chancellor of Information Services at Purdue University Northwest, “IT is aligned with the business when IT moves from being a service organization to delivering business solutions.”

The subtle difference between providing business solutions and being a service provider requires a proactive approach. As Tim explains it, “In the reactive model, IT fixes problems but is outside of the decision-making process.”  Being proactive as an IT organization means being “a collaborative business partner delivering solutions that solve specific business problems. IT collaborates with the business to identify business problems to provide proactive solutions, improving products, customer experience, and business reputation.”

The days of IT just implementing the right technology are long gone. IT has to be an engaged part of every business strategy discussion because technology touches every piece of the business.  IT must be engaged from the beginning if that technology is to work to enable value to the business and its end users. 

Mike Gill, CIO at Marian, Inc, explains it this way, “You need to ensure your solution delivery provides value. The value is not if you have the best technology or it runs the most efficiently, the value is if it solves a problem the business has.” 

Of course, it’s easy to say that the IT organization is driving value and is aligned with the business. But what does ‘alignment’ actually look like?  How do you know if you’re aligned? 

What Does Business-IT Alignment Look Like?

If business-IT alignment is connected to driving business value, then you have to start there. Of course, as I’ve pointed out before, the problem with “value” is that it’s a perception. What’s valuable to IT might not be valuable to the business – and vice-versa.  So it’s important that value is identified and agreed by every stakeholder in the organization — customers, partners, suppliers and internal stakeholders. Defining and agreeing on the definition of value as an organization is the first step to getting IT and the business aligned. 

Once value is defined, you can refine your workflows and processes to ensure they are actually delivering business value, including the appropriate measures within those workflows to check for value. For example, Mike shared a way that he can determine if IT is aligned with the business. 

“We have an internally developed ERP system and have the freedom to implement workflows that provide maximum business value – it is a custom system tailored to our company. One sign that we are aligned is looking at transactions in the system,” explained Mike. “Are users doing all the steps in real-time or are they catching up transactions at the end of the day? Looking at the logs you can see if a process that should occur over a longer period (days, not minutes) is mirrored by a similar timeline of transactions in the system. If I see those transactions happening by different people over the course of a day or two then I know the system is aligned to the business (both function and usability). If I see all those transactions happen within minutes of each other then I know they are just catching up work into the system because they must – [which indicates that IT is] not aligned.”

The key here is that Mike made sure the technology fit and supported the workflows of the business, instead of the other way around – a key to business-IT alignment. This enables the technology to be instrumented or monitored to confirm business value – and therefore, better aligned with the organization. 

Additionally, to ensure you’re aligned, look to see if IT is being invited to new projects and initiatives at the kickoff meeting. According to Mike, “It is easy to invite IT leadership to monthly and annual executive status meetings and feel like you are giving them importance or that you are aligning business and IT. That does matter, but it matters more when the regular business projects and initiatives are inviting IT representation in the first steps. It means the business and IT are given the chance to stay aligned from the beginning rather than create the feeling that IT just does what the business says – that never leads to good outcomes.”

IT leaders must regularly check in with other company leaders to ensure that IT is involved with all upcoming initiatives.  If you do that, you’re on your way to business-IT alignment. 

What To Do About Business-IT Alignment?

Once some signs of business-IT alignment begin to appear within an organization, you have to ask yourself one thing: “What am I going to do with this opportunity?”

I believe that IT organizations struggling with business-IT alignment fall into one of two camps. The first group doesn’t know how to achieve business-IT alignment. For that organization, they need to collaborate across the organization to define and agree on value, co-create workflows and solutions to achieve that value, and work together to monitor and continually optimize those solutions.

The other camp consists of organizations that believe that they have business-IT alignment – but they don’t. This is a much larger number of companies than the number of organizations that just can’t figure out alignment.  For these companies, the IT organization is in danger of losing its influence in the company – if it has any influence at all.

Business-IT alignment can often become performative in organizations. It’s easy to have meetings, to gain an agreement on a definition of value, and to create workflows that should enable the realization of value. It’s another thing to ensure that everyone in the organization – both from the business and from IT- is following through and living that definition of value. 

The important thing every IT leader must do is identify what happens after the big discussions, after the kickoff meetings,  and understand what is really going on in the day-to-day running of the organization. Is your team clear on the value it delivers and how it delivers it? Are you enabling your team to work across departments and proactively identify and promote the value you’re delivering? Are you enabling the rest of the organization to have input in how IT is operating and to provide feedback and suggestions for what needs to be done from a business perspective?

Business-IT alignment isn’t a 50-50 split. To achieve and maintain alignment, both IT and the business have to give 100 percent to make alignment work. But before they can both commit 100%, one team has to be the one to step up and put all the effort in first. I believe that team is the IT organization.  IT has to start giving 100% toward business-IT alignment,  even before the business commits to alignment. It’s work to get into alignment and the onus will fall on IT, especially in the beginning – but it’s work that pays off.. 

And remember, business-IT alignment isn’t a one-and-done activity. It’s a continual process that has to be monitored, mapped and measured on a regular basis. 

My challenge to you is to share: how are you staying aligned in your organization? What are your methods for checking and measuring business-IT alignment? Where are the gaps in business-IT alignment that you need to fill?

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