From the dWb website			Feature Article
The alignment of Business with IT is the holy grail for most organisations as they sail through the shifting seas of globalisation, market changes, industry retrenchment and emerging information technologies. It is crucial that IT is aligned to the critical business initiatives to ensure ongoing success for most, and even survival, for many companies. The customers, suppliers, distributors, competitors and business partners are demanding organisations deliver higher quality goods and services faster. The alignment of business processes and information management is fundamental to the achievement of business success. It is not an easy challenge; in fact it is an elusive objective that can never be fully realized because change is the only constant in an organisation. What is important is that you maintain a level of alignment that allows the organisation to have the agility and flexibility to respond to the changes as quickly as possible. The competition will not wait until you catch up; they have competitors of their own to contend with. The feature article discusses the problems of not having Business-IT alignment and the questions that need to be answered and addressed to begin the journey. The winds of fortune will blow and the difficulties will be considerable but the spoils will be worth it.				Feature Story The Business to IT alignment challenge Since mid-2001 businesses have been planning for the future. They have been reflecting upon the costs of Y2K, assessing the costs and benefits of the dot.com ex- and implosion, calculating the price of a global recession and reviewing the impact on the global economy of the September 11th act of terrorism. This has resulted in the slashing of budgets and the scrutinizing of the value of IT. The chief executive is convinced that IT is a necessary evil and has no real linkage to business whilst the IT management feels that business doesn't understand them. The gauntlet has been thrown down - how do we align business with IT? The concept is not new; the solution is not easy and needs to effort to implement. The first thing we need to do is decide what it really means. My definition is: The appropriate application of IT to support a business process The problem is that a business has many processes. These processes have different process owners and are at different levels of maturity. As the requirements are being formulated and costed to secure the necessary funding they are looked at in isolation. The projects are defined and initiated. As they progress it becomes clear that they are not aligned to the overall objectives of the organisation. They are addressing selective areas of the business fabric in an uncoordinated fashion. The e-business initiatives have highlighted the problems as their projects can trigger horizontal business processes that need to cut across stovepipe systems and data in real time. Because many of these systems have different interfaces and different data structures the cross-functional requirements cannot be supported. This results in a misalignment of the business objectives and the IT delivery. Symptoms of the problem Ø Redundant databases delivery inconsistent information to management, suppliers and customers Ø E-business order-processing systems cannot trigger fulfillment, inventory adjustments, billing, shipping and other critical functions Ø Redundant business functions replicating processes delaying supply chain integration initiatives Ø Multiple billing systems preventing horizontal integration of e-business processes Ø Redesigned e-business process cannot be implemented due to poor integration of the application architecture Ø An electronic marketplace initiative is threatened by an inadequate infrastructure or poorly defined processes Ø Business requirements are not being interpreted effectively by IT resulting in unnecessary rework before being implemented Ø The value of IT is being continuously challenged as being a too high cost against the perceived benefits Why is this happening? I feel that one of the major reasons is that nobody has an holistic view of the organisation. The management structures devolve responsibilities to functional and business management with specific metrics. These metrics dictate the organisational behaviours and culture. This devolved organisation is allowed to define its own strategies to meet their interpretation of the goals. The misalignment begins here. What should be done? With business processes, application systems, data and infrastructures requiring continuous realignment it is necessary that actions are taken to reverse this trend. It is important that the misalignments are identified and a plan conceived to realign business and IT within an ever increasingly complex information ecosystem that is extending beyond the traditional distribution and supply chains. As the requirements are being gathered a cross-functional team should checked them against the overall goals of the organisation. This team should be mandated to assess the projects and if they do not align they are rejected, if they are tactical they are time-boxed, if they are strategic they are consolidated into sponsored programmes to take advantage of synergies and if they cannot be measured they are squashed. The sort of questions that should be asked are: BUSINESS INFRASTRUCTURE ALIGNMENT Business Alignment ? Are the different parts of the business aligned with the organisation's core purpose, principles and business plan ? Are major functions replicated across the organisation that could be more effectively consolidated ? To what degree are functions fragmented across various parts of the business ? Is there consolidation work remaining from a merger, acquisition or joint venture ? Can you disseminate or share information throughout the organisation Customer Support Alignment ? Does the executive team focus on customer satisfaction as a priority one ? Is there unnecessary replication of order processing, fulfillment, tracking, shipping, customer service or other functions critical to customer satisfaction ? Do customers have access to the information they need, when they need it ? Is Customer Relationship Management (CRM) a top priority ? Is there a separate functional area tracking customer satisfaction Distribution Chain Alignment ? Does your industry rely on collaborate, Internet-based distribution solutions to do their business? Are you participating in an industry distribution chain consortium or e-Marketplace ? Are competitive e-marketplaces emerging in your industry Supply Chain Alignment ? Does your organisation have a supply chain strategy emphasizing collaboration with other companies ? Have you included competitors in your industry supply chain strategy ? Have you extended your supply chain purchasing processes vertically into 3rd-party organisations ? Is your organisation deploying supply chain information systems to integrate information on the flow of goods and services across the supply chain ? Is your organisation deploying supply chain execution systems to reduce unnecessary shipping, inventory holding or other costs associated with managing the flow of goods through the supply chain Supplier Management Alignment ? Has supplier management stayed current with changes in business, 3rd-party and IT strategies ? Is your supplier management function providing local autonomy while leveraging the economies of centralized purchasing function ? Have you established a transition strategy for supplier relationships evolving into collaborative supply and distribution chain relationships BUSINESS PROCESS ALIGNMENT Intrabusiness Process Alignment ? Is there documentation identifying the flow of business processes across the organisation ? Do business units contain overlapping business processes ? Does business process flow support the timely execution of priority tasks as processes flow from business unit to business unit ? Are processes fragmented in such a way as to inhibit the deployment of e-business solutions or other priority initiatives Interbusiness Process Alignment ? Does documentation exist identifying the flow of business processes that expand beyond the enterprise ? Has your organisation consolidated existing external processes to better align them with a streamlined distribution or supply chain management plan ? Has your organisation explored opportunities to integrate processes into 3^rd party domains ? Have collaborative relationships been established with 3^rd parties to enable the integration of vertical processes into distribution and supply chains Business Process and IT Alignment ? Does documentation exist identifying the application systems and data structures supporting critical business processes ? Are legacy business processes supported by legacy information systems data structures ? Are consolidated business processes supported by fragmented information systems and data structures ? Are critical business processes not supported by, or ineffectively supported by, application systems ? Do information systems support the horizontal flow of business processes across core business functions in a timely manner consistent with your e-business strategy ? Do information systems support the horizontal flow of business processes into distribution and supply chains in a manner consistent with your e-business strategy ? Have process automation tools been deployed to streamline the flow of horizontal and vertical processes throughout the organisation DATA MANAGEMENT ALIGNMENT Internal/External Data Alignment ? Is there a repository or similar documentation available to cross-reference business data with related or identical business data across the organisation ? Are there plans to reconcile redundancies in business definitions among various business departments ? Have there been any efforts to document business data definitions and their relationship to external data definitions being used across distribution and supply chains ? Have there been any efforts to reconcile external business data definitions as a part of an effort to vertically integrate distribution and supply channels Business Data/IT Data Alignment ? Is there a repository or similar documentation available that cross-references business data definitions with data definitions embedded in screens, reports, software and databases ? Has work been done to create business data/IT data cross-reference information and make it available to business and IT analysts ? Are there plans or is work under way to reconcile redundancies in business definitions between business units and IT ? Have external data exchange requirements been gathered from and communicated to various IT functions so they can reconcile discrepancies or fulfill data exchange requirements IT Data Alignment ? Is there a repository or similar documentation available that cross-references data definitions found in screens, reports, software and databases with similar or identical data found within other IT departments ? Has an effort been made to rationalise identical data definitions used in different systems and databases to achieve a common, cross-functional view of data ? Have there been data integrity analysis or associated data cleanup efforts ? Has IT made any attempts to consolidate redundant or overlapping data structures IT INFRASTRUCTURE ALIGNMENT IT Organisational Alignment ? Are there centralised functions for vendor contracting, standards management, technology analysis, legal services and hardware selection ? Can individual business and IT departments make autonomous decisions regarding applications and data management, development tasks, maintenance issues, personnel ? Does IT centrally coordinate decisions and functions requiring cohesive management ? Have IT and business management defined a collaborative governance structure based on common purpose and principles Hardware and Software Platform Alignment ? Does the organisation have an inventory of existing operating hardware and software for all environment across the organisation ? Has management clearly articulated an agreed hardware strategy ? Is the organisation using any hardware considered obsolete, extraneous or generally undesirable ? Has management clearly articulated an agreed operating system, utility, development tools and database software strategy ? Have hardware and software strategies been reconciled Security Alignment ? Do you have a security strategy for the organisation ? Is there a full-time individual on staff assigned to information security management ? Have vertical integration teams developed security procedures to prevent security breaches through 3^rd parties ? Are the business partners and associated certified that they are using appropriate security precautions and technology ? Are the security precautions and technology regularly tested by a 3^rd party Communication Systems Alignment ? Do your communication systems meet your requirements ? Does your communication strategy consider the latest technologies ? Do communication suppliers meet current requirements ? Is the communications infrastructure capable of easy integration into an e-world ? Has your organisation used, or plan to use, Internet conference technology to reduce travel time and costs and enhanced remote collaboration Tool, Technology and Automation Usage Alignment ? Is there an overall strategy behind the acquisition and deployment of technologies that can help automate IT analysis, design, development, deployment, testing, communication and management tasks ? Do development teams have access to an integrated development environment that facilitates the integration of design, development and deployment tasks ? Are modeling tools available to business analysts to assist with defining requirements for new and existing systems ? Do IT analysts have design tools to support the development and evolution of e-business and other information systems ? Are tools available to inventory and document application environments ? Are tools available to support the analysis of legacy systems including tools to capture and isolate business rules ? Do analysts have access to data mining and data reverse-engineering technologies Project Management/ Project Office Alignment ? Does your organisation have a project or project management office ? Does the project office have a mandate to work closely with all project teams across IT, business and 3^rd part projects ? Do project office personnel have access to the status of all projects within their domains ? Are the project statistics communicated to the organisation Methodology Usage Alignment ? Does IT management encourage the use of methodologies across various IT disciplines ? Does IT management support the concept of agile methodologies where tasks are streamlined or performed concurrently to shorten the timescales ? Has IT provided a methodology to business units to guide them in the creation of business requirements analysis ? Do design analysts follow a methodology when creating system and data design specifications ? Do development teams use a methodology to guide their system coding and testing efforts ? Is there a methodology in place to support legacy systems analysis and business rule extraction ? Does IT employ a methodology to guide the integration of new systems into existing environments which includes data integration ? Does IT us a component management methodology Skill Usage and Training Alignment ? Does IT maintain a database showing where certain skills reside within IT, business and 3^rd party suppliers/consultants ? Does the company provide formal training to keep people current on the latest technologies and techniques ? Does IT cross-train development and legacy analysts and programmers to ensure that individuals have transferable skills and flexibility Business-IT Collaboration Alignment ? Are there many complaints from the business that IT does not understand their needs ? Are there many complaints from IT that the business cannot articulate their requirements or do not respond to IT questions ? Do the business want to do it themselves because of a lack of IT responsiveness ? Are there IT personnel embedded within the business
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