One of the things you strive for as an IT director is to run a department that supports the daily needs of the whole business while also being in tune with its long-term strategy. The alignment of IT with business strategy has been a mantra of IT heads for years but has often proved hard to achieve.
The reason lies in the structure and decision-making processes of modern companies. Many organisations communicate their strategy through a variety of media: slide shows, videos and face-to-face discussions.
Objectives, in particular, are based on divisional silos: sales directors takes responsibility for their objectives; finance directors for their objectives, and so on. Directors then split their objectives to their line managers. These managers do the same at departmental and team level, so that each has their own set of objectives. Eventually, these filter down to individuals, defining their targets, goals and responsibilities.
This poses a problem for IT directors. Staff in different departments want software and hardware to meet their departmental requirements, but if the individual systems are not integrated, the IT department is not supporting the whole business.
Many business departments will have no incentive to change the way they use technology or the business processes around it if they feel they are already meeting their departmental targets - particularly if other departments are not meeting theirs.
IT directors, meanwhile, will be under pressure from the board to ensure that systems are integrated and common technology is used.
IT directors can minimise this tension by taking five basic steps. First, they should ensure that there is a common understanding of the business strategy. What are the individual objectives of the board? For the sales director this might be increasing sales or breaking into new markets. An expansion into new markets, for instance, might require the development of a new customer relationship management system.
Second, explain strategies and targets in terms of the business processes used by all departments and the technology needed to underpin this.
Third, create a shared interpretation of the objectives and targets. If the sales director wants to expand overseas, the IT implications of such a move - for instance creating a shared services centre, or outsourcing systems - need to be discussed. Changes to a business will have a big impact on the IT strategy.
Fourth, understand the trade-offs inherent in the strategy and objectives. If an organisation has multiple objectives - cutting costs, expanding overseas and improving customer services - certain targets will have to take priority, creating a series of trade-offs. IT directors need to be aware of the business priorities so they can plan their strategy and allocate resources.
Fifth, identify areas of conflict between departmental objectives and the possibility that technology can harmonise business processes and departmental squabbles.
Ashley Abraganza is senior lecturer in information systems at Cranfield School of Management