In my previous article in this series, I examined the question: “Where is the business going, and consequently, what should the role of IT be?”

In this article, I will share an approach to align the business and IT strategy in a way that will keep the promise of long-lasting corporate brand identity.

You can say, “Where business goes, IT follows.” The problem is that the “where” (i.e., a desired target state) is hiding the “who” (i.e., who you are and who you want to be by reaching a new destination).

This reminds me of an evergreen quote from Lucius Annaeus Seneca: “Our plans miscarry because they have no aim. When a man does not know what harbor he is making for, no wind is the right wind.”

The point is that the business and IT aims must be aligned, and the two identities should converge. The question is how to do that if what IT wants to do first is not necessarily what the business is asking for.

The conflicting identities of business and IT popped up a few months ago when I was breaking the ice with customers who were interested in managing their systems with a more agile IT competence center. They wanted this competence center to run and support the deployment of SAP S/4HANA, which was going live imminently.

I was looking for a model that would help them plan and build for their system landscape’s evolution. I ended up combining three key philosophies from very different sources:

1. Logical levels learned in The Art & Science of Coaching training, which provides the structure for moving from an inspiring vision to more concrete actions in specific times and places
2. The corporate brand identity matrix, from the Harvard Business Review, to find the “unique twist” of a company’s identity based on its brand or core values
3. Diversity and inclusion concepts learned from SAP’s employee training, which adds the “fairness” spices

Starting with “logical levels”

The student guide for the Erickson Academy’s The Art & Science of Coaching shows a pyramid that elegantly sorts the structure and dependencies of “five plus one” logical levels:

Vision is the “plus one” level of the pyramid, which inspires identity (the top logical level) rooted in core values representing the reason specific behaviors (skills and actions) define the different ways to play in a given context.

Those general concepts also work well for business and IT people working together in alignment for a common vision, mission, and strategy:

1. Identity: Who are you now? What sort of person/organization would you rather be? (Shifting into a new role)
2. Values: Why is this important? What values does it have? (Values behind identity and vision)
3. Skills: How will you achieve it? What capabilities do you have? What skills do you need to develop? (Knowledge, experience, methods, and tools)
4. Actions/behaviors: What actions need to be taken? What steps could you take to support X? (Action plan, steps, behaviors)
5. Environment: Where will you want this? When will you do it? (Time and geography)

Deriving IT mission, vision, and strategy from “corporate and brand identity”

Stephen A. Greyser and Mats Urde, in their HBR article “What Does Your Corporate Brand Stand For?” (issue 97, Jan./Feb. 2019), illustrate a framework for a corporate brand identity definition.

The brand core is at the center of the framework, surrounded by eight elements, making room for nine questions to be answered.

After reading this article, I thought of my current next-generation competence center design project and decided to first answer the corporate identity questions from the business point of view, then answer the same questions from the IT point of view.

My IT counterparts were dubious after the first attempt to answer the questions from the IT point of view. Later, when I insisted on doing this exercise in a timebox fashion (I stepped out of the room for less than an hour), I heard excitement and realized how well they did in filling out different forms twice, based on the different points of view.

The first time you answer the nine questions from both points of view – business (as suggested by HBR) and IT (for the sake of the next-generation IT competence center) – your answers might look sloppy or disconnected. This is because consistency must be checked along four directions, aimed at enhancing four “angles.”

The clearer and more logical your definitions (answers) and narrative (combination of answers), the more consistent the identity matrix and the stronger your identity will be. That’s provided that all the four directions are properly crossing the very same core values, i.e., core brand.

In short, check the nine answers in clusters of four, as follows:

1. Strategy: Is the mission (what you promise) consistent with where you want to be (vision)?
2. Competition: Is what you offer (your value proposition) unique due to particularly distinctive skills?
3. Interaction: Does the way you interact (your relationships) delight your customers thanks to uncommon behaviors rooted in a well-known culture?
4. Communication: Is your communication style fostered by unique personality traits?

Repeat this process a few times and try to discard concepts that don’t contribute to clear answers. Sometimes less is more.

Adding “diversity and inclusion”

Building a culture of diversity and inclusion plays an important role in aligning business and IT strategy.

Diversity and inclusion training can stretch minds, enrich vocabulary, and enhance the ability to think differently. It will create a balance between individual and collective culture and help you achieve measurable targets, fueling a new, more open, and correct way of working.

Here are some things to consider when building a culture of diversity and inclusion:

1. Culture elements: Shared values, knowledge, experiences, beliefs, and behaviors
2. Culture transmission: Socializing agents (people we are with) and institutions (school, government)
3. Cultural attitudes: Role models made of different attributes, to be tuned up to better fit a given target cultural attitude:
   • Status: Rank-oriented (do what the boss commands) vs. equality-oriented (challenging/arguing with boss is OK)
   • Identity: Individual-oriented (what I/he did) vs. group-oriented (the result we made)
   • Activity: Task-oriented (duty first) vs. relationship-oriented (people first).
   • Risk: Risk-taker (change-driven) vs. stability-seeking (steady state is better)
   • Communication: Direct (talk/write clearly – facts only) vs. indirect (room for interpretation – body language)

Thinking more and deeply about who we are and who we want to be is always good for us and for the people who want to take action.

Are you intrigued or skeptical?

I’ll be happy to hear your comments and adjust the recipe for aligning business and IT strategy.

Stretch your mind on the Next-Generation Competence Center by reading my previous articles on the topic, “Part I” and  “Part II.”

The role of IT: Where business goes, IT follows

In this article, we’ll start by determining which moment your company is living—i.e., where is the business going, and consequently, what should the role of IT be?

To clarify the debates around competence center best-fits and how business needs and business strategy should shape the goal of an IT department, I modified this model from an MIT article published by Weill and Ross in March 2005:

I have used this model many times to advise customers in setting the right expectations with business and top management. This representation smoothly navigates the discussion on what an IT department or a specific competence center should do, bringing the required “either-or” attitude to the decision-making process.

If you show decision-makers this schema and have them label where they see their company in its current state and where they see it at a future state in terms of the different goals, it’s easy to derive the focus of the IT organization you are talking about:

• Standardization is suitable for centrally ruled/managed/delivered processes and services, but it is not prone to change.
• Competition mode encourages local initiatives, triggering innovation more than centralization.
• Harmonization is the compromise between the two extreme situations or moments that a company may live in.

I use this next schema to help customers plan for IT changes and determine where to allocate decision-making bodies; it mirrors the three columns of Weill and Ross and offers illustrative combinations of IT governance elements fit for the selected “target state.”

Business decision authority (business or CC-owned) is the first thing to be sorted out to define the customer’s single point of contact/decision-maker for a given business process/topic.

• If there is only one business process owner in the entire organization, then centralization is already there; if different BUs/countries have different equivalent roles, independence or coordination may be needed (committees, advisory boards, champions come into play).

Solution design authority (CC- or IT-owned) is the second thing to be organized:

• Rarely does all expertise exist in one role or one person.
• External consultants are needed to evaluate, review, and validate architecture.

The rest of the activities (organizational units and roles) can be located within CC, in the rest of IT, or outsourced.

• Build and test is normally sourced to system integrators, internally for small changes, or to stable partners working with a master service agreement.
• Adjustments and rollout are normally driven internally.
• Support and maintenance, depending on support levels, can be sourced in different mixes.
• Operations are likely to be mostly centralized, insourced, or outsourced.

Based on enterprise structure (business units, geographies, etc.) and organization constraints (business accountability for business, processes, and data), the IT mission is reviewed before IT governance and organization are designed consistently, considering global/central stakeholders and users versus local, national, and functional specific needs.

A competence center, as part of an IT department, inherits a portion of missions and goals of the organization it belongs to and therefore can be oriented toward cost-cutting or encouraging innovation (agility and flexibility).

If we forget the magic word—digital—we can see that some management practices are still fit for defining the rules of the game for a competence center.

In theory (with an unlimited budget, enough time, new systems, powerful tools, and skillful resource), any business need can be answered properly. However, this is hardly the case in the real world, especially for large enterprises.

• Selection of changes worth investing in is a necessity, and sequence matters. Foundational changes enabling subsequent ones is a delicate art. Business processes and existing systems include many constraints and dependencies to consider and changes in plans are very likely.
• Fully understanding and prioritizing business requirements and impacts requires modern IT professionals to be not only IT experts but also “business smart” and careful.
• IT must be ready, fast, and skilled enough to be recognized as the best shop to check first (which means they must be agile).

If your department can meet these preconditions, you still may be stopped or slowed by other roadblocks, such as slow funding procedures more sensitive to financial indicators than to strategic outcomes and people’s natural resistance to change.

I have worked as both a CIO and a management consultant, so I’ve made and faced similar situations at different times from different angles.

There are only two exits at the “go/no-go” roundabout (three if you add deferred decision-making):

1. Even the apparently secured budget (e.g., for IT revamping necessary changes that include hardware replacements every five years and upgrading out of maintenance software) is likely to be written off or postponed until the next “business-funded transformation train” is about to start.
2. If business asks for and is willing to fund innovation, it’s easy; if the envisioned innovation can be monetized then it’s always possible to build a value case (a good story explaining the benefits, even if it lacks numbers) or a business case (with NPV, ROI, and all the indexes that please CFOs) and find the money and resources needed for any good ideas popping up.
3. If there aren’t enough good reasons to proceed with a given change – and compliance with new regulations may not be enough – the proposed change will be dropped (or “temporarily deferred” for a long time until it is forgotten) and superseded by a more urgent one.

At the next roundabout, which direction are you willing to take?

Are you sure you have the right mix of people, processes, and technology enablers (read “competence center”) to move your IT organization to the next level?

I am always excited to start a new conversation, provided that the direction the customer wants to take is clear and there is enough accountability and commitment to kickstart a new transformation journey. Curiosity is king in finding new paths towards innovation exploration and IT excellence.

One of my favorite quotes comes from William Gibson, an author I used to read 30-something years ago before films like “The Matrix” popped up;  he coined the term “cyberspace” in his short story “Burning Chrome” and later popularized the concept in his debut novel, “Neuromancer” (1984):

“… The future is already here — it’s just not very evenly distributed.” -W. Gibson, on “Fresh Air”