download ppt

BT 450Information Management

IT GOVERNANCEIT GOVERNANCE

ALIGNMENT GAP

65%

10%

Said “ineffective communicationineffective communication of business strategy and goals between

business management and IT management” is a significant or moderate challenge

Reported that their companies have been

“extremely successful” at aligning“extremely successful” at aligning IT plans with corporate strategies

Ref: Deloitte Consulting, New York, and IDG Research Services, Framingham, Mass.

Symptoms of Strategic Alignment ProblemsBusiness IT Understanding and Rapport

Competitive Decline

Fired IT Manager(s)

High Turnover of IT Professionals

Inappropriate Resources (HR , $$)

IT Reorganizations

Lack of Executive Interest in IT (Champion,Sponsor)

Lack of Vision / Strategy

No Communication

Ongoing Conflicts

Outsource

Productivity Decrease

Projects• Not Used• Canceled• Late• Value questionable

Redundancies in systems development

Systemic Competencies

Systems integration difficult (e.g., standards, politics)

Unhappy Users/Complaints

LONG LIST ABOUT SYMPTOMS OF ALIGNMENT PROBLEMSLONG LIST ABOUT SYMPTOMS OF ALIGNMENT PROBLEMS

Str

ateg

ic

Fit

BUSINESS Business Strategy

IT IT Strategy

Business Scope

Distinctivecompetencie

s

Business Business GovernanceGovernance

Technology Scope

Systemic competencie

s

Functional Integration

Administrative Structure

Processes Skills

IT Architectur

e

Processes Skills

IT InfrastructureOrganizational Infrastructure

The Strategic Alignment Model

IT IT GovernancGovernanc

ee1.1. Internal decisionsInternal decisions2.2. Strategic PartnersStrategic Partners3.3. RegulationRegulation

General governance control model

Plan

Ref: IT Governance Institute, COBIT Management GuidelinesRef: IT Governance Institute, COBIT Management Guidelines

Do Check

Correct

50%50%Percentage of IT executives who say their board of

directors provides adequate oversight of theircompany’s IT activities.

REF: CIO INSIGHT

The Digital Obstacles

•We’re doing too well/poorly financially (there is no sense of urgency)•Change is too difficult, and no one has the appetite for this much change•We have too many other priorities•We’re in the midst of a turnaround and can’t focus on digital•We don’t know how to do it•Its not our current business plan•Its not in our budget•Its not part of our vision•We don’t want to alienate our existing customers•We don’t want to upset our sales and distribution channels•Our customers aren't digital-ready•Our employees aren't digital-ready•We cant afford to spend money on the digital infrastructure•Our management team isn't digital-savvy•We’re already too late.

CHANGE MANAGEMENT TOPICS THAT CHANGE MANAGEMENT TOPICS THAT RELATE TO IT GOVERNANCE!!!RELATE TO IT GOVERNANCE!!!

What are the key decisions that must be made? *(Purpose)

Who will make these decisions? *(Power)

Why will they make them? *(Alignment) How will they make them? *(Decision Process)

IT Governance is a Process and set of IT Governance is a Process and set of Metrics/Controls focusing on:Metrics/Controls focusing on:

CORPORATE EXECUTIVE MANAGEMENTCORPORATE EXECUTIVE MANAGEMENT

TEAM DECISION

EXECUTIVE IT MANAGEMENTEXECUTIVE IT MANAGEMENT

OTHEROTHER IT MANAGEMENT

BOARD OF DIRECTORS

28%

47%

11%9% 5%

59%22%

10% 7%

2%ITIT EXECUTIVES SAID BUSINESSBUSINESS EXECUTIVES SAID

SOURCE : INFOWORLD TRUE VALUE OF IT STUDY

Who sets the strategic technological direction??? 1 OF 3

DISJOINTDISJOINT

Ref: Optimize Research

10 20 30 40 50 60

Midlevel IT Management

Line-of-business managers who need technology for business processes

Mixed Committee

Top Corporate Management

Top IT executives, such as the CIO

Who has Who has ultimate ultimate

authority for authority for setting setting budget budget

priorities for priorities for your your

company’s IT company’s IT spending? spending?

2 OF 3 2 OF 3

% of respondents

Business Business management or staffmanagement or staff

IT management or IT management or staffstaff

DISJOINTDISJOINT

Which of the following steps do you believe Which of the following steps do you believe would significantly improve IT/business would significantly improve IT/business

alignment at your company? alignment at your company? 3 of 33 of 3

Give IT MANAGEMENTIT MANAGEMENT more control and authority over decisions involving how information technology is used to support business goals.

IT EXECUTIVES BUSINESS EXECUTIVES

Give BUSINESS MANAGEMENTBUSINESS MANAGEMENT more control and authority over decisions involving how information technology is used to support business goals.

IT EXECUTIVES BUSINESS EXECUTIVES

62% 45%

38% 55%

Ref: CIO Insight

DISJOINTDISJOINT

IT GOVERNANCE ARCHETYPESIT GOVERNANCE ARCHETYPES

Business Business MonarchyMonarchy

A group of, or individual business executives (i.e. CxOs). Includes committees comprised of senior business executives (may include CIO). Excludes IT executives acting independently.

IT monarchyIT monarchy Individuals or groups of IT executives.

FeudalFeudal Business unit leaders, key process owners or their delegates.

FederalFederal Shared by C level executives and at least one other business group (e.g.,CxO and BU leaders) – may also include IT executives. Equivalent of the center and states working together.

IT DuopolyIT Duopoly IT executives and one other group (e.g., CxO or BU leaders).

AnarchyAnarchy Each individual user.

Note: Some governance styles inspired by Tom Davenport, Information Ecology. Oxford University Press.

Different parts of the organization work better with different archetypes.Different parts of the organization work better with different archetypes.

KEY PLAYERS IN IT GOVERNANCE ARCHETYPES

Source: IT Governance: How Top Performers Manage IT Decision Rights for Superior Results, P. Weill & J. Ross

Business Monarchy

IT Monarchy

Feudal

Federal (CxO+ Unit)

Anarchy

Corporate IT and/or Business

Unit IT

Business Unit Leaders or Key

Business Process Owners

CxO Level Execs

IT Duopoly (IT Execs+one other group

either

either

1.1. Which is most effective & why?Which is most effective & why?2.2. Remember:Remember:

a.a. Governance focuses on DecisionsGovernance focuses on Decisionsb.b. Organization focuses on ReportingOrganization focuses on Reporting

Use next week.Use next week.

Why is IT Governance an Issue?

• Does anyone discuss Finance Governance, Marketing Governance, or HR Governance?

• How many CIO’s are part of the most senior executive committees? How many CFO’s? How many product executives? How many manufacturing executives? What are their roles?

• Two Countervailing forces exist today:1. Growing recognition that IT has become an

integral part of the business2. Inadequate performance by IT organizations

and CIO’s

76%76%Percent of business leaders who are aware they have IT problems Percent of business leaders who are aware they have IT problems that could be resolved by implementing an IT governance that could be resolved by implementing an IT governance framework.framework.

(IT GOVERNANCE INSTITUTE/PRICEWATERHOUSECOOPERS)

58%58%Percent of CEOs and CIO's who have implemented, are Percent of CEOs and CIO's who have implemented, are implementing, or are considering an IT governance program.implementing, or are considering an IT governance program.

(IT GOVERNANCE INSTITUTE/PRICEWATERHOUSECOOPERS)

53%53%Of CIO's say their IT project prioritization is politically drivenOf CIO's say their IT project prioritization is politically driven(CIO INSIGHT)

40%40%Of CIO's use a portfolio management approach to IT projectsOf CIO's use a portfolio management approach to IT projects(CIO INSIGHT)

Rarely does everyone always agree regarding what is the

right thing to do, or how to do it

Why a Governance Process

IT Governance – Why? Insufficient resources to meet commitments

Unreliable delivery schedules resulting from insufficient staff &

changes

Lack of focus on daily business operations due to utilizing IT

operations and maintenance staff on projects

Reduced quality & demonstrable value of delivered projects

Potential for working on the wrong things

Business functions begin to move in their own IT direction to satisfy

their own requirements with minimal or no IT support

Chaotic / non-standard infrastructure (IT & business), resulting in

poor operational maintainability

Enhance communications & relationships

Enable/drive business opportunities & strategies

How involved is IT in the development of corporate strategy?

Total IT Execs Business Execs

Very involved

Involved in many discussions

35%

36

37% 32%

Somewhat Involved

Not Involved

19%

6%

34%

26%

8%

23

7

38%

Ref : CIO Insight Balanced Scorecard

How well is IT’s own strategic plan understood across the company?

Total IT Execs Business Execs

Well or generally understood

Somewhat understood or not at all

47%

52%

50%

49% 55%

44%

Ref : CIO Insight Balanced Scorecard

Reasons for Not Implementing Reasons for Not Implementing Formal IT Governance ProcessesFormal IT Governance Processes

Too expensive 28%

Lack of required skills 20%

Formal solutions won’t work 17%

No IT problems to fix 11%

Company is too small 11%

Too difficult to implement 7%

Others 29%

Base: 46 CEO’s and CIO's surveyed as part of wider study; multiple responses allowed

SOURCE: IT GOVERNANCE INSTITUTE, ROLLING MEADOWS, ILL., AND PRICEWATERHOUSECOOPERS, NEW YORK

IT Governance - What?

• Resource allocation

• Business initiative evaluation (include risk)

• Project prioritization

• Performance/value measurements and tracking

• Cost determination and assignment

• Facilitate IT-business relationship

• Integration and Standards direction

Stagnation IT capability exceeds

business need

IT and business IT and business alignedaligned

InnovationInnovation

Stagnation deliberate

policy

Stagnation IT unable to

innovate

Stability ChangeConservative

IT IT ManagementManagement

Innovative

BusinessBusiness orientation

IT-Business Alignment Governance

WHERE IS AIR PRODUCTS?

Governance Alternatives

BudgetCareer crossoverCIO-CEOCommunicate / market / negotiateCompetitive enabler/driverEducation / cross-trainingLiaisonLocationOrganizationPartnership/Alliance ManagementProcessService Level ManagementShared risks, responsibilities, rewards/penaltiesSteering committee:

• strategic• tactical• operational

Value Measurement

Source: IT

Governance: H

ow T

op Perform

ers Manage IT

Decision R

ights for S

uperior Results. P

. Weill &

J. Ross, H

arvard Business S

chool Press, 2004.

Corporate and Key Asset GovernanceCorporate and Key Asset Governance

Corporate GovernanceShareholders

Monitoring

Stakeholders e.g., employees,

customers, creditors

Disclosure

Board

Senior Executive Team

Desirable Behavior

Key Assets Requiring Governance

Human Assets Financial Assets Physical Assets Know-how & IP (Intellectual Property) Assets

Information (& IT) Assets

Relationship Assets

Financial Governance Mechanisms

IT Governance Mechanisms

- Executive Committee - Budget Process - Capital Approval Process - Cash Flow Management

- Executive Committee - IT Steering Committee - Budget Process - IT Organization- Architecture Committee - Service Level Agreements - Process Teams with IT

Strategy

Finance: Usually most effective. What are their attributes/characteristics?

Typical Strategy CalendarTypical Strategy CalendarQ1 Q2 Q3 Q4

Strategy update: CEO and executive team clarify vision.

Senior executives have no consistent way to

describe strategy.

Two-thirds of HR and IT organizations are not aligned with strategy.

Line-of-business and support-unit leaders conduct strategic planning.

60% of companies do not link budgets to

strategy

CFO oversees budgeting

HR coordinates personal goal setting, incentives, and personal development.

70% of middle managers do not have

strategy-linked incentive pay.

95% of the workforce does not understand

the strategy.

The vast majority of executive teams spend less

than one hour per month discussing strategy.

Top executives conduct monthly management reviews.

Corporate communications unit disseminates information.

Chief knowledge officer oversees knowledge sharing.

Governance process is necessary

= deficiencies in old management process

Ref: Harvard Business Review by Robert S. Kaplan and David P. Norton

20 40 60 80 100

% of panel members

CIO

CFOExecutive VP or general manager

Other executive management

President

Chief operating officer

CEO

Chief marketing officer

Chief technology officerIS or networking management

Business - unit heads

Other

Who sits on the IT advisory panel ?

SIM

THE WAY TO IMPROVE ALIGNMENT THE WAY TO IMPROVE ALIGNMENT

IT leaders sit down with business leaders to discuss how technology can best benefit corporate goals.

In tandem, the IT and business leaders formulate a strategic plan that includes projects, schedules and budgets.

The plan is presented to a cross-functional senior management team, which compiles proposals from the various business/IT teams. The proposals are reviewed and prioritized using portfolio process.

Senior management releases the final strategic plan. Because projects are assigned to the people who proposed them, the IT/business partners are much more likely to champion their initiatives. Business sponsor is identified

Projects are reviewed monthly to ensure they stay on track.

1

2

3

4

5

Three types of governance mechanisms

Executive or Senior Management committee

IT leadership committee comprising IT executives

Process teams with IT members

Business/IT relationship managers

IT council comprising business & IT executives

Architecture committee

Capital approval committee

Governance Mechanism Percent Use

Tracking of IT projects & resources consumed

Service level agreements

Formally tracking business value of IT

Chargeback arrangements

Work with managers who don’t follow the rules

Senior management announcements

Office of CIO or office of IT governance

Web-based portals and intranets for IT

DECISION-MAKING STRUCTURES:DECISION-MAKING STRUCTURES:

ALIGNMENT PROCESSES:ALIGNMENT PROCESSES:

COMMUNICATION APPROACHES:COMMUNICATION APPROACHES:

3.5 +

3.8 +

3.4

3.9 +

3.7

3.1

3.1

3.4 +

3.2

2.9 +

2.8

3.2

2.9

3.6

2.9

CIO Ranked Effectiveness “1” (ineffective)

to “5” (highly effective)

0 10 20 30 40 50 60 70 80 90 100

Ref: MIT Sloan-CISR-Weill

Steering Committee Critical Success Factors

• Bureaucracy• Career building• Communication• Complex decisions• Influence/ empowerment• Low hanging fruits/quick hits• Marketing• Objectives/measurements• Ownership/Accountability• Priorities (80 -20 rule)• Relationships• Right participants• Share risks• Structure, facilitator

The First Barrier to Large Committees

1 3 5 7 9 11 13 15 17 19 21 23 25 27 29 31 33 35 37 39 4541 43 5147 49 53 55

1800

1600

1400

1200

1000

800

600

400

200

0

Number of People

Nu

mb

er o

f H

and

shak

es

Forms of Governance & Leadership Roles

HOW STANDARDS ARE DEFINED

REF : Sloan Management Review, Winter 2000 Storck Hill

Leadership Role

Thick Matrix Thin Matrix Strategic Community

Corporate Headquarters

Designing and mandating strategy

Providing guidance

Defining strategy, providing sponsorship, & facilitating the community

Business Unit Manager

Ensuring compliance with corporate mandates

Interpreting corporate advisories & making decisions

Sharing knowledge among business units & providing feedback to CHQ

IT CHQ Influence on IT BU-Related Decisions

11%

16%

39%

34% Sets policies and shapes many decisions

Sets policies and guides some decisions

Sets some policies and reviews BU proposals

Minimal influence

Ref: Organizing for Global Competitiveness: The Role of Corporate Head quarters and its Leadership in Organizational Integration

WHAT DO YOU THINK???

Repository Governance Repository Governance State Farm Insurance

• Data policy (e.g., Standards, SLA’s)

• Business opportunities

• Roles and responsibilities

• Usage of data

• Enterprise data vs data for the enterprise

• Information quality

PRIORITIZING PROJECT PORTFOLIOPRIORITIZING PROJECT PORTFOLIO

Consider all projects

Group projects based on:•Necessity, Opportunity, Desirability•Risk•Resource demands•Anticipated return

Prioritize projects

EXAMPLE PORTFOLIO ASSESSMENT

Project Name

“MUST

DO”

Return on

Option

Probability of

Technical Success

Probability of Business Success

Development Cost

Alpha 30 0.80 0.50 3

Beta 63.75 0.50 0.80 5

Gamma 8.62 0.75 0.75 2

Delta 3 1.00 1.00 1

Echo 50 0.60 0.75 5

Foxtrot 66.25 0.50 0.80 10

Consensus via: Delphi or Scenario Planning

Scenario Planning Grid

HighPriority!

MediumPriority

Low Priority

High Medium Low

High

Medium

Low

Impact on FirmP

rob

abil

ity

of

Occ

urr

ence

•Discussions and consensus•Scoring method•Directional decision rules

Three Types of Risks

1. Risks that the project will fail

2. Risk of not doing the project

3. Risk that it is the wrong project for what is trying to be

achieved

Go to Hell Go to Heaven

No Consequence

No Consequence

Early forms of Risk Management

Don’t believe e.g., Be Bad

Do Believe e.g., Be Good

God Exists

God Does Not

Exist

Ref: Pascal, while trying to figure out whether one should live a pious life devoted to faith or a sybaritic life devoted to din was able tot tease out the base elements of any risk analysis – outcomes (what actually happens); actions (what one does in anticipation of those outcomes); and consequences (the impact of one’s actions);

A

B

C

?

The Four Levels of Residual Uncertainty

1 A clear enough 1 A clear enough futurefuture

•A single view of the future

2 Alternate futures2 Alternate futures

•A limited set of possible future outcomes, one of which will occur

3 A range of 3 A range of futuresfutures

•A range of possible future outcomes

4 True ambiguity4 True ambiguity

•Not even a range of possible future outcomes

• Traditional tools:

- Porter’s Five Forces

- market research

- cost benchmarks

- SWOT analysis

- core competencies

- discounted cash flow/NPV

• Traditional tools plus:

- decision or event trees

- scenario-planning

- game theory

• Traditional tools plus:

- scenario-planning

- game theory

- Market research

- System dynamics

- Black-Scholes

• Working backward

to what you would

have to believe to

support a given

strategy:

- analogies &

reference cases

- management

simulatorsROI POTENTIALROI POTENTIAL

To Evaluate risk of failure, answer To Evaluate risk of failure, answer these four questions:these four questions:

1. What is the probability the project will be competed on time?

2. Will it be completed within budget?

3. Could it be impacted by an internal issue (over which company has control)?

4. Could it be impacted by an external issue (over which the company has little or no control)?

Ref: Information Systems Management in Practice by Barbara C.McNarlin &Ralph H.Sprague Jr.

Do-ability versus Financial Value AssessmentDo-ability versus Financial Value Assessment

Ref: The Executives Guide to Information Technology by Baschab & Jon Piot

Low Hanging

Fruit

Gems

Re-evaluateDifficult Projects

HIGHFINANCIAL VALUELOW

LOW

HIGH

DO

-AB

ILIT

Y

Ref: The Strategy Focused Organization, R. Kaplan, D. Norton

Risk Profiling

Sources of Market Risk

•Market size and scope•Definition of customer base•Knowledge of customer needs•Distribution channels•Regulatory environment•Intellectual property regimes•Competitor's position & reaction

Sources of Technology Risk

•Technical Feasibility•Uncertain standards•Physical dangers•Product liability•Supply of materials•Manufacturability

Sources of Organizational Risk

•Fit with capabilities•Cost•Speed of organizational change•Dependence on new organization•Dependence on external partners•Quality & Availability of personnel•Burn rate Vs. cash and capital

Technology Risk

Market Risk

Organizational Risk

High

High

High

Low

Low

None

Organizational Impact

Development Effort

Technology Organizational Capability

High

Significant change to business rules

Complex business processes

Multiple organizations involved

Development/system integration cost > $10 million

Over 2 years in development

Emerging Unproven New for Firm

Immature organization

Uses the ad-hoc processes

Organizational track record suggest inability to mitigate risk

Medium

Moderate Changes to business rules

Medium complexity

Up to 29 staff years

$ 2 - $ 10 million

1-2 years in development

Proven in industry or at organizational level

New to organization

Maturing organization

Reasonable level of success

Low

Insignificant or no change in business rules

Low complexity

Under 10 staff

Under $ 2 million

Under 1 year in development

Standard Proven Organizational technology

Mature organization Strong track record Stable organization

Risk Level Criteria

REF: SIM, SEATTLE STATE GOVERNMENT

Governance Metrics

GE:GE: Coffins & Halo’s

Avon:Avon:• Red• Yellow • Green

Closing the Strategy- to-Performance Gap

Keep it simple, make it concrete

Debate assumptions, not forecasts

Use a rigorous framework, speak a common language

Discuss resource deployments early

Clearly identify priorities

Continuously monitor performance

Reward and develop execution capabilities

Harvard Business Review

There is no “silver bullet”…

It takes a combination of “things” to make it a success!!!

Climbing the Strategic Alignment Maturity ModelClimbing the Strategic Alignment Maturity Model

BusinessStrategy

IT Strategy

LEVEL 1 Initial Process

LEVEL 2 Committed Process

LEVEL 3 Established process

LEVEL 4 Improved Process

LEVEL 5OptimizedProcess

Alignment Gap

These are the KPAs associated with each level:

An organization is not considered to be at a given level

until it has satisfied the conditions for every Key Process

Area through that level.

OPTIMIZING (5)OPTIMIZING (5)

INITIAL (1)

MANAGED (4)

DEFINED (3)

REPEATABLE (2)

ContinuouslyContinuouslyImprovingImprovingProcessProcess

PredictablePredictableProcessProcess

Standard,Standard,ConsistentConsistentProcessProcess

DisciplinedDisciplinedProcessProcess

•DEFECT PREVENTION PROCESS•TECHNOLOGY CHANGE MANAGEMENT•PROCESS CHANGE MANAGEMENT

•QUANTITATIVE PROCESS MANAGEMENT

•SOFTWARE QUALITY MANAGEMENT

•ORGANIZATION PROCESS FOCUS•ORGANIZATION PROCESS DEFINITION•TRAINING PROGRAM•INTEGRATED SOFTWARE MANAGEMENT

•SOFTWARE PRODUCT ENGINEERING•INTERGROUP COORDINATION•PEER REVIEWS

•REQUIREMENTS MANAGEMENT•SOFTWARE PROJECT PLANNING•SOFTWARE PROJECT TRACKING AND OVERSIGHT

•SOFTWARE SUBCONTRACT MANAGEMENT

•SOFTWARE QUALITY ASSURANCE•SOFTWARE CONFIGURATION MANAGEMENT

The structure of the SEI CMMThe structure of the SEI CMM

SEI People Capability Maturity Model

1.Initial

2.Repeatable

3.Defined

4.Managed

5.Optimizing

CompensationTrainingPerformance ManagementStaffingCommunicationWork Environment

Participatory CultureCompetency-Based PracticesCareer DevelopmentCompetency DevelopmentWorkforce PlanningKnowledge and Skills Analysis

Organizational Performance AlignmentOrganizational Competency ManagementTeam-Based PracticesTeam BuildingMentoring

Continuous Workforce InnovationCoachingPersonal Competency Development

Continuously improve methods for developingpersonal and organizational Competence

Quantitatively manage organizational growthin workforce capabilities and establishcompetency-based teams

Identify core competencies

and align workforce

activities with them

Instill basic disciplineinto workforce activities

Reporting/

· ·

·

· · ·

-

·

- - - Inter -

Education, Cross-

IT BUSINESS ALIGNMENT MATURITY CRITERIA

PARTNERSHIP

•Business Perception of IT Value•Role of IT in Strategicc Business

Planning•Shared Goals, Risk,

Rewards/Penalties•IT Program Management•Relationship/Trust Style•Business Sponsor/Champion

SCOPE & ARCHITECTURE•Traditional, Enabler/Driver,

External•Standards Articulation•Architectural Integration: - Functional Organization -Enterprise-Inter enterprise

•Architectural Transparency, Agility, Flexibility

•Manage Emerging Tech.

SKILLS

•Innovation, Entrepreneurship•Cultural Locus of Power•Management Style•Change Readiness•Career crossover training

•Hiring and retaining

by Business

•Liaison(

COMMUNICATIONS

•Understanding of Business by IT

•Understanding of IT

•Inter/Intra organizational Learning/Education

•Protocol Rigidity•Knowledge Sharing

s) effectiveness

COMPETENCY/VALUEMEASUREMENTS

•IT Metrics•Business Metrics•Balanced Metrics•Service Level Agreements•Benchmarking

•Formal Assessments/Reviews•Continuous Improvement

GOVERNANCE

•Business Strategic Planning•IT Strategic Planning•Organization Structure

•IT Investment Management•Budgetary Control

•Steering Committee(s)•Prioritization Process

Interpersonal Environment•Social, Political, Trusting

-

·

Education, Cross-

IT BUSINESS ALIGNMENT MATURITY CRITERIAIT BUSINESS ALIGNMENT MATURITY CRITERIA

•Role of IT in Strategic

PARTNERSHIP•Business Perception of IT Value

c Business

Planning

•Shared Goals, Risk,

Rewards/Penalties

•IT Program Management

•Relationship/Trust Style

•Business Sponsor/Champion

SKILLS

COMMUNICATIONSCOMMUNICATIONS


•IT Metrics

•Business Metrics

•Balanced Metrics

•Service Level Agreements

•Benchmarking

•Formal Assessments/Reviews

•Continuous Improvement

GOVERNANCE

•Business Strategic Planning

•IT Strategic Planning

•Organization Structure

•IT Investment Management

•Budgetary Control

•Steering Committee(s)

•Prioritization Process

•Career cro

•Innovation, Entrepreneurship

•Cultural Locus of Power

•Management Style

•Change Readiness

ssover training


Interpersonal Environment

•Social, Political, Trusting

•Traditional, Enabler/Driver, External

•Standards Articulation•Architectural Integration: - Functional Organization -Enterprise

-Inter enterprise•Architectural Transparency,

Agility, Flexibility•Manage Emerging Tech.

SCOPE & ARCHITECTURE

• Understanding of Business by IT

• Understanding of IT by Business

• Inter / Intra-organizational Learning / Education

• Protocol rigidity

• Knowledge Sharing

• Liaison(s) effectiveness

·

Education, Cross-




c Business

Planning


Rewards/Penalties




SKILLS

COMPETENCY / VALUE COMPETENCY / VALUE MEASUREMENTSMEASUREMENTS

GOVERNANCE








•Career cro



•Management Style

•Change Readiness

ssover training









• IT Metrics

• Business Metrics

• Balanced Metrics

• Service Level Agreements

• Benchmarking

• Formal Assessments / Reviews

• Continuous Improvement

COMMUNICATIONS

Learning/Education

•Liaison(s)

•Inter/Intra


•Protocol Rigidity

by Business


organizational

•Knowledge Sharingeffectiveness

Education, Cross-




c Business

Planning


Rewards/Penalties




SKILLS

•Career cro



•Management Style

•Change Readiness

ssover training









COMMUNICATIONS

Learning/Education

•Liaison(s)

•Inter/Intra



by Business


organizational



•IT Metrics

•Business Metrics

•Balanced Metrics


•Benchmarking



GOVERNANCEGOVERNANCE

• Business Strategic Planning

• IT Strategic Planning

• Organization Structure

• Budgetary Control

• IT Investment Management

• Steering Committee(s)

• Prioritization Process


COMMUNICATIONS

Learning/Education

•Liaison(s)

•Inter/Intra



by Business


organizational



•IT Metrics

•Business Metrics

•Balanced Metrics


•Benchmarking



PARTNERSHIPPARTNERSHIP• Business Perception of IT Value

• Role of IT in Strategic Business Planning

• Shared Goals, Risk, Rewards/Penalties

• IT Program Management

• Relationship / Trust Style

• Business Sponsor / Champion

GOVERNANCE








SKILLS

•Career cro



•Management Style

•Change Readiness

ssover training












c Business

Planning


Rewards/Penalties




COMMUNICATIONS

Learning/Education

•Liaison(s)

•Inter/Intra



by Business


organizational



•IT Metrics

•Business Metrics

•Balanced Metrics


•Benchmarking



SCOPE & SCOPE & ARCHITECTUREARCHITECTURE

• Traditional, Enabler / Driver, External• Standards Articulation• Architectural Integration:

• Functional Organization• Enterprise• Inter enterprise

• Architectural Transparency, Agility, Flexibility• Manage Emerging Tech.

GOVERNANCE








SKILLS

•Career cro



•Management Style

•Change Readiness

ssover training







c Business

Planning


Rewards/Penalties









COMMUNICATIONS

Learning/Education

•Liaison(s)

•Inter/Intra



by Business


organizational



•IT Metrics

•Business Metrics

•Balanced Metrics


•Benchmarking



SKILLSSKILLS• Innovation Entrepreneurship

• Cultural Locus of Power

• Management Style

• Change Readiness

• Career crossover training

• Social, Political, Trusting


• Hiring and retaining

GOVERNANCE








Reporting/

· ·

·

· · ·

-

·

- - - Inter -

Education, Cross-

IT BUSINESS ALIGNMENT MATURITY CRITERIA

PARTNERSHIP

•Business Perception of IT Value•Role of IT in Strategicc Business

Planning•Shared Goals, Risk,

Rewards/Penalties•IT Program Management•Relationship/Trust Style•Business Sponsor/Champion

SCOPE & ARCHITECTURE•Traditional, Enabler/Driver,

External•Standards Articulation•Architectural Integration: - Functional Organization -Enterprise-Inter enterprise

•Architectural Transparency, Agility, Flexibility

•Manage Emerging Tech.

SKILLS

•Innovation, Entrepreneurship•Cultural Locus of Power•Management Style•Change Readiness•Career crossover training


by Business

•Liaison(

COMMUNICATIONS



•Inter/Intra organizational Learning/Education

•Protocol Rigidity•Knowledge Sharing

s) effectiveness


•IT Metrics•Business Metrics•Balanced Metrics•Service Level Agreements•Benchmarking

•Formal Assessments/Reviews•Continuous Improvement

GOVERNANCE

•Business Strategic Planning•IT Strategic Planning•Organization Structure

•IT Investment Management•Budgetary Control

•Steering Committee(s)•Prioritization Process

Interpersonal Environment•Social, Political, Trusting

Strategic AlignmentMaturitySummary

•Initial/Ad-Hoc process

•Committed process

•Established focused process

•Improved/ managed process

•Optimized process

Level 2

Level 1

Level 3

Level 4

Level 5

•COMMUNICATIONS: Business/IT lack understanding•COMPETENCY/VALUE: Some technical measurements•GOVERNANCE: No formal process,cost center, reactive priorities •PARTNERSHIP: Conflict; IT a cost of doing business•SCOPE & ARCHITECTURE: Traditional (e.g., acctng, email)•SKILLS: IT takes risk, little reward; Technical training

•COMMUNICATIONS: Limited business/IT understanding •COMPETENCY/VALUE: Functional cost efficiency•GOVERNANCE: Tactical at Functional level,occasional responsive•PARTNERSHIP: IT emerging as an asset; Process enabler•SCOPE & ARCHITECTURE: Transaction (e.g., ESS, DSS)•SKILLS: Differs across functional organizations

•COMMUNICATIONS: Good understanding; Emerging relaxed•COMPETENCY/VALUE: Some cost effectiveness; Dashboard established•GOVERNANCE: Relevant process across the organization•PARTNERSHIP: IT seen as an asset; Process driver;Conflict seen as creative•SCOPE & ARCHITECTURE: Integrated across the organization •SKILLS: Emerging value service provider;Balanced tech & business hiring

•COMMUNICATIONS: Informal, pervasive•COMPETENCY/VALUE: Extended to external partners•GOVERNANCE: Integrated across the org & partners•PARTNERSHIP: IT-business co-adaptive/improvisational•SCOPE & ARCHITECTURE: Evolve with partners•SKILLS: Education/careers/rewards across the organization

•COMMUNICATIONS: Bonding, unified•COMPETENCY/VALUE: Cost effective;Some partner value;Dashboard managed•GOVERNANCE: Managed across the organization•PARTNERSHIP: IT enables/drives business strategy•SCOPE & ARCHITECTURE: Integrated with partners•SKILLS: Shared risk & rewards



Level 1

•COMMUNICATIONSCOMMUNICATIONS: Business/IT lack understanding

•COMPETENCY/VALUECOMPETENCY/VALUE: Some technical measurements

•GOVERNANCEGOVERNANCE: No formal process,cost center, reactive priorities

•PARTNERSHIPPARTNERSHIP: Conflict; IT a cost of doing business

•SCOPE & ARCHITECTURESCOPE & ARCHITECTURE: Traditional (e.g., acctng, email)

•SKILLSSKILLS: IT takes risk, little reward; Technical training

•Optimized processLevel 5

•COMMUNICATIONSCOMMUNICATIONS: Informal, pervasive

•COMPETENCY/VALUECOMPETENCY/VALUE: Extended to external partners

•GOVERNANCEGOVERNANCE: Integrated across the org & partners

•PARTNERSHIPPARTNERSHIP: IT-business co-adaptive/improvisational

•SCOPE & ARCHITECTURESCOPE & ARCHITECTURE: Evolve with partners

•SKILLSSKILLS: Education/careers/rewards across the organization

WHERE IS THE ORGANIZATION STRONG/WEAK?

WHERE IS THERE DISAGREEMENT?

WHAT ARE THE IMPLICATIONS?

WHAT CAN BE DONE TO IMPROVE THE MATURITY LEVEL (PRESCRIPTIVE)?

IT OPENS THE DOOR TO DISCUSSING ALIGNMENT

IT IS NOT JUST THE LEVEL OF IT IS NOT JUST THE LEVEL OF MATURITYMATURITY

Perceived Comfort Level of the 6 Perceived Comfort Level of the 6 Criteria Criteria (Factor Analysis)(Factor Analysis)

1. Governance

2. Scope & Architecture

3. Partnership 4. Competency/Value5. Skills6. Communications

Why do you think this is the case?Why do you think this is the case?

Strategic Alignment MaturityStrategic Alignment Maturity

10

30.6

39.4

12.5

1.9

0

5

10

15

20

25

30

35

40

Level 1 Level 2 Level 3 Level 4 Level 5

% o

f R

espo

nde

nts

PRESENTATION ON IT BUSINESS ALIGNMENT MATURITY ASSESSMENT

USE APPENDIX A OR B FROM THE ARTICLE “ASSESSING BUSINESS-IT ALIGNMENT MATURITY” TO

DERIVE A QUESTIONAIRE OR INTERVIEW QUESTIONS

PRESENTATION SHOULD BE APPROXIMATELY 10 MINUTES, COVERING:

1. HOW/WHO PROVIDED ASSESSMENT INPUT

2. OVERVIEW OF ASSEMENT LEVELS FOR ALL SIX CRITERIA THAT DESCRIBES WHY THE

ORGANIZATION FALLS INTO A LEVEL FOR THE CRITERIA; WHERE ARE THERE

DIFFERENCES AMONG PARTICIPANTS? WHY?

3. IMPLICATIONS (“SO WHAT”): MAJOR PROBLEMS & OPPORTUNITIES

4. HOW CAN THE ORGANIZATION DO BETTER: RECOMMENDATIONS

5. NEXT STEPS

IMPORTANT CONSIDERATIONS:

1. PRIORITZE IMPLICATIONS & HOW ORGANIZATION CAN DO BETTER 2. AIM HIGH; FOCUS ON THE FOREST NOT THE TREES 3. BE SPECIFIC 4. YOU MUST INTERVIEW AT LEAST 3 IT & 3 BUSINESS EXECS PER PERSON ON YOUR TEAM

ALL CASES AND RESEARCH PROJECT SHOULD APPLY THE ASSESSMENT



•Committed process

•Established focused process

•Improved/ managed process

•Optimized process

Level 2

Level 1

Level 3

Level 4

Level 5

•COMMUNICATIONS: Business/IT lack understanding•COMPETENCY/VALUE: Some technical measurements•GOVERNANCE: No formal process,cost center, reactive priorities •PARTNERSHIP: Conflict; IT a cost of doing business•SCOPE & ARCHITECTURE: Traditional (e.g., acctng, email)•SKILLS: IT takes risk, little reward; Technical training

•COMMUNICATIONS: Limited business/IT understanding •COMPETENCY/VALUE: Functional cost efficiency•GOVERNANCE: Tactical at Functional level,occasional responsive•PARTNERSHIP: IT emerging as an asset; Process enabler•SCOPE & ARCHITECTURE: Transaction (e.g., ESS, DSS)•SKILLS: Differs across functional organizations

•COMMUNICATIONS: Good understanding; Emerging relaxed•COMPETENCY/VALUE: Some cost effectiveness; Dashboard established•GOVERNANCE: Relevant process across the organization•PARTNERSHIP: IT seen as an asset; Process driver;Conflict seen as creative•SCOPE & ARCHITECTURE: Integrated across the organization •SKILLS: Emerging value service provider;Balanced tech & business hiring

•COMMUNICATIONS: Informal, pervasive•COMPETENCY/VALUE: Extended to external partners•GOVERNANCE: Integrated across the org & partners•PARTNERSHIP: IT-business co-adaptive/improvisational•SCOPE & ARCHITECTURE: Evolve with partners•SKILLS: Education/careers/rewards across the organization

•COMMUNICATIONS: Bonding, unified•COMPETENCY/VALUE: Cost effective;Some partner value;Dashboard managed•GOVERNANCE: Managed across the organization•PARTNERSHIP: IT enables/drives business strategy•SCOPE & ARCHITECTURE: Integrated with partners•SKILLS: Shared risk & rewards

WHERE IS WHERE IS AIR PRODUCTS?AIR PRODUCTS?

Answer the following questions Answer the following questions regarding Air Products:regarding Air Products:

1. What is the main focus of the case (Abstract)?

2. Who is the:a. Sponsor? b. Champion(s)?

3. What is/are the major problem(s) they are trying to address?

4. What are the alternatives?

5. What is/are your specific recommendation(s)?

6. What are your specific next steps?

11. Administrative . Administrative StructureStructure

Processes Skills

IT Architectur

e

Processes

IT InfrastructureOrganizational Infrastructure

Skills

A.A. Internal Internal

DECISIONSDECISIONSa.a. Decision LevelsDecision Levelsb.b. WhoWhoc.c. HowHowd.d. Risk Mgt.Risk Mgt.e.e. CIO Role CIO Role f.f. ArchetypesArchetypesg.g. Maturity LevelMaturity Level

B.B. Strategic PartnersStrategic PartnersC.C. RegulationRegulation

Str

ateg

ic

Fit

Business Scope

Distinctivecompetencie

s

Business Business GovernanceGovernance

Technology Scope

Systemic competencie

s2.2. IT IT

GovernanceGovernance

REPORTINGREPORTING• Company Org.Company Org.• IT Org.IT Org.• CIO ReportingCIO Reporting

NEXT WEEK PRESENT:

BUSINESS Business Strategy

IT IT Strategy

Functional Integration

The Strategic Alignment Model

download ppt

Documents

business goals

business managers

business group

business execution

governance archetypes

governance institute

governance styles

governance canshould