governance - Innovative Service Management Consulting and Training: Tedder Consulting

“What is the value of IT?”

It’s the question that gets asked over and over. But the question itself is not the problem – it’s a symptom. It distracts from the real issue: the absence of organizational accountability for IT value.

As a result, your organization gets the IT it deserves.

How organizations end up with the IT they deserve

Organizations end up with poor IT when:

Technology is viewed as a cost center
Leadership fails to modernize or invest
Business units and IT operate in silos
Digital transformation lacks clarity
Governance is weak or outdated
The human experience is undervalued

That’s not to say that all of this is the fault of the organization. IT can influence many of these issues by defining a service catalog. A service catalog is the authoritative, business-facing description of IT services—defined in clear, outcome-oriented terms that show how IT enables business value. A service catalog is not a list of technologies or a menu of request forms. It is a structured representation of what the IT organization delivers, why it matters, and how it supports business outcomes.

Without a service catalog, IT becomes invisible – a utility seen as a just a back-office function tasked with fixing technology and keeping systems running, rather than driving value. This mindset allows the business to avoid owning strategic technology decisions, deflecting responsibility for unclear business requirements, shifting priorities, poor planning, or the lack of business strategy alignment. As a result, IT is left to guess or assume what business outcomes the organization is expecting.

On the other hand, when the business and IT work as one team, the question of “IT value” disappears. IT value isn’t a question when:

Organizational leadership treats IT as strategic, not tactical
Investments (including technology) align with business priorities
Workforce readiness is cultivated
Innovation and foresight become cultural norms
Processes are designed to enable, not constrain
Systems are human-centric and intuitive

The key difference in the organization getting the IT it deserves – good or bad – is how business strategy and IT strategy are connected. The service catalog (or lack thereof) is the concrete expression of that connection.

What we have here is a lack of strategic alignment

As Mark Lutchen noted in Managing IT as a Business, technology only delivers benefits when implemented with an understanding that it changes how a company works. Among the principles discussed within his book, Lutchen advised that business and IT strategy must align to ensure that technology drives profits.

But when business strategy and technology strategy are treated separately, then the organization is constrained, if not prevented, from fully leveraging technology for business benefit. This approach results in bad behaviors within the organization, such as

IT is expected to align to a business strategy for which it had no input
IT is brought in at the last minute to strategic business discussions when it becomes apparent that technology is involved.

McKinsey’s research reinforces this point – without aligning investments to strategic technology trends, organizations chase hype instead of harvesting value. Many companies chase trends without developing internal capacity, resulting in minimal return.

Defining IT services and, subsequently, a service catalog not only provides a framework to evaluate innovation, but it also represents a mutually agreed understanding between IT and the rest of the business for ensuring that technology investments result in business value.

But the hard truth is that some organizations do not want to change the status quo. Some within organizations would rather bluster about “IT value” rather than taking action to establish and enforce accountability through strategic alignment.

Stop debating IT value, start aligning IT with the business

Defining IT services establishes the critical foundation for answering the question “what is the value of IT?” Start from the “outside” then work back “inside” the organization to answer the following questions:

What is the business of the business?
Who are our customers?
What do those customers need?
Why do those customers come to us?
What do those customers expect from us?
Who is accountable for ensuring that customers are happy?
What combinations of IT and non-IT people, processes, and technology enable us to do that?

The answers to these questions provide the foundation for defining services, and ultimately, a service catalog.

Earn the IT you deserve

Business-IT alignment is one of the strongest predictors of whether technology investments translate into outcomes such as business performance, operational excellence, and competitive advantage. IT cannot create value in isolation – it’s the partnership between IT and the business that unlocks it. A well-defined service catalog demonstrates that both share a common understanding of value, outcomes, and expectations – the foundation of alignment.

In this recent CIO.com article, Mike Blandina, the CIO at Snowflake, made some predictions regarding the CIO role. As one would expect, AI adoption is a significant part of Blandina’s predictions, but there are a few details within his predictions that I found interesting:

The need for governance frameworks – As organizations adopt AI-enabled capabilities, they must also adopt responsible AI practices. CIOs will be held accountable to implement governance frameworks that span the entire AI lifecycle, with clear ownership, regular audits, and documented risk assessments.
Enterprise-wide innovation – The CIO role will shift from ‘IT’ to ‘ET’ – enterprise technology The traditional IT metrics will still matter, but CIOs will increasingly focus on business outcomes. The IT function becomes less about infrastructure and more about delivering intelligence.
Technology must move from only support to business-critical – Blandina concludes his article by stating that “successful CIOs will be those who elevate technology from a support function to the central nervous system of the business.”

Admittedly, these are all topics that have been long discussed. What is different now?

At the risk of stating the obvious, the difference now is the business demand to adopt AI-enabled capabilities. This demand represents a significant opportunity for CIOs to transform the role and reputation of IT. Now is the time to act.

Are you ready for the new (renewed?) expectations of the CIO role? Can your IT organization elevate its thinking from just developing and implementing technology solutions to delivering business outcomes?

If not, enterprise service management (ESM) may be the solution.

Why ESM is the solution

ESM is a way to meet the new expectations that organizations will have of CIOs. While ESM leverages the principles of IT Service Management (ITSM), true ESM is not just extending IT workflows into other departments within an organization. ESM is an organizational capability for holistically delivering business value and outcomes, based upon shared processes, appropriate technology, increased organizational collaboration, and better communication across the organization.

As I’ve said before, when done well, ESM drives greater operational efficiency, fosters cross-department collaboration, reduces costs, enhances customer satisfaction, and increases an organization’s ability to adapt quickly to changing business needs. It also strengthens governance and compliance, while the improved service delivery resulting from effective ESM enables a truly differentiated customer experience.

Don’t fall for “imposter ESM”

Unfortunately, many organizations have adopted what I would call “imposter ESM”. For example, many organizations have fallen into the trap of trying to extend IT-oriented workflows into other parts of the organization. Other organizations have used the guise of an ESM initiative to spread the costs of an expensive ITSM tool across the organization. Still others take a technology-first approach and install department-specific modules intended to manage workflows within those departments.

None of these approaches deliver the benefits of real ESM adoption. The CIO can avoid imposter ESM by following these tips:

ESM is best considered as a business strategy designed to deliver value and improve both the employee and customer experience across the enterprise.
ESM requires that organizations break down silos and focus on end-to-end value streams, which involves collaboration across departments.
ESM establishes the foundation for compliance to governance policies to ensure consistent and measurable business outcomes and value.

Good ESM positions organizations to take advantage of AI-enabled capabilities. But it’s more than that – good ESM positions the CIO to establish IT as a business-critical capability, driving appropriately-governed technology to deliver business outcomes.

Elevate Enterprise Value through Strategic ESM Foundations

These critical success factors for ESM also provide a great foundation for effective ESM.

Understanding how value is perceived within the organization – Talk to other business leaders to understand how they perceive value – and how to measure and report on that value.
Understanding and mapping organizational value streams – Value stream mapping provides visualization of how value flows through the organization. A value stream map also depicts where collaboration is required for the customer to realize value.
Understanding the journeys of customers and employees – Journey mapping provides insights into the experience of individuals as they interact with the organization. Journey mapping provides the foundation for delivering differentiated human experiences, both within and external to the organization.
Committing to continual improvement – Formally build continual improvement capabilities to ensure that the organization can react to changes in the business environment in a timely fashion to ensure on-going value to its stakeholders.

AI adoption can be transformational with an organization. But, as with any transformational and impactful solution, there is no “magic wand.” Technology – like AI – only amplifies the current state of workflows and behaviors – right or wrong. Outcomes come from the interactions of people, systems, and tools – not just tools alone. Good business results come from an effective strategy for achieving objectives – not from chasing technology without clear business goals and defined success measures.

Good ESM is no different. But the benefits of good ESM are more than establishing a holistic and collaborative approach for delivering business value and results. Good ESM provides the foundation for governance, fuels innovation by understanding how work gets done, and shifts the role of IT from technology support to business enabler.

Tag Archives: governance

Why Your Organization Gets the IT It Deserves