In today's business environment, IT departments are a crucial component of organizational success. However, there is often a disconnect between IT and other departments that can hinder overall performance.
Here are the key takeaways from this article:
- IT departments can become disconnected from business operations due to differences in how success is measured.
- IT management may have relied too heavily on vendors and industry analysts for advice, leading to a lack of trust in the business.
- There has been no formal preparation for making managerial decisions for IT, leading to a lack of clarity around roles and responsibilities.
- Bridging the gap between IT and business requires a cultural shift towards greater openness and trust and a recognition that IT is an integral part of the business.
- To achieve this, organizations need to focus on communication, collaboration, and shared objectives.
In this article, we will explore the factors contributing to the IT business disconnect and its consequences, as well as potential solutions to address the issue. Bill Inmon, the father of data warehousing, provides his unique perspective on IT management and its need for accountability to achieve success.
Table of Contents
- Different Metrics for Measuring Success
- Over-Reliance on "Silver Bullet" Solutions
- Influence of Industry Analysts
- Lack of Formal IT Management Preparation
- Consequences of IT-Business Disconnect
- What are the main causes of IT departments being disconnected from business operations?
- How can organizations ensure that IT is seen as an integral part of the business rather than a separate entity?
Just today there appeared an article in the WSJ that was really interesting. The article was It’s "Time to get rid of the IT department", by Joe Peppard. If you haven’t read it I really recommend that you do. One of the points raised in the article is – how and why did the IT department get divorced from the business it operates in?
Now that is a very good question.
Like most widespread phenomenon, there is not one single answer. Instead, there is a whole panoply of answers.
Different Metrics for Measuring Success
One cause of the IT business disconnect is the difference in how success is measured.
IT department’s success is not measured in the same way as classical business success. IT success is often measured in terms of response time, system availability, and transactions running, while business success is measured in terms of profitability, revenue growth, and new customers.
These different metrics can make it difficult for IT to fully understand the priorities and objectives of the business, and vice versa. There simply is little or no connection between what IT considered important and what business considers important. But there are other factors.
Over-Reliance on "Silver Bullet" Solutions
Consider this. For years IT management bought into the “silver bullet”. The problem was that 99% of these silver bullets were harem scarum ideas that never panned out.
IT management has a history of buying into vendor recommendations without critical analysis. This over-reliance on "silver bullet" solutions can lead to expensive experiments that do not yield results, frustrating the business.
The business got tired of financing the IT experiments that were never examined closely and never worked. The business wants tangible results, not broken promises.
Influence of Industry Analysts
IT management thought vendors were telling them good business advice. Instead, the vendor was just selling more products. IT management could not distinguish the good advice from a sales pitch.
IT management often seeks the approval of industry analysts before making a purchase. However, many of these industry analysts are biased, as they receive money from the very companies they are supposed to analyze objectively. This can result in recommendations that do not align with the business's needs.
Lack of Formal IT Management Preparation
Admittedly there are a lot of other factors. It is true that technology is changing all the time. Keeping up with technology is a full-time job. Unlike doctors, accountants, and engineers, there has been no formal preparation for IT management. It was as if one-day technology descended on the earth and whoever happened to be convenient in the corporation was tapped for being the IT manager. This lack of formal preparation makes it challenging for IT managers to fully understand and align with the business's needs.
Consequences of IT-Business Disconnect
The IT business disconnect can have negative consequences for organizations. It can lead to misaligned priorities, inefficient use of resources, and difficulty in measuring the value of IT initiatives. It can also hinder innovation and growth.
A Technician's Lack of Awareness of Customers
The IT-business disconnect can manifest in surprising ways. To summarize matters…. Several years ago, I was talking with a technician at a large telecommunications firm. I mentioned the word “customer” to him.
To my surprise, the technician said, “Customer? What’s that? Do we have them?”
And I am not joking. That really happened.
This anecdote illustrates the extent of the disconnect between IT.
Related Reading: IT & Text Analytics
What are the main causes of IT departments being disconnected from business operations?
There are several main causes of IT departments being disconnected from business operations. Here are a few:
Lack of Communication: A lack of communication between IT and other departments can lead to misunderstandings and misaligned priorities. Without clear communication channels, IT may not fully understand the business needs, while other departments may not fully appreciate the capabilities and limitations of IT.
Siloed Culture: When IT operates in a silo, it can become isolated from the rest of the organization. This can lead to a lack of understanding of how IT fits into the overall business strategy and objectives.
Legacy Systems: Legacy systems can make it difficult for IT to keep up with the needs of the business. These systems may be outdated or inflexible, making it difficult to integrate them with newer technologies and processes.
Lack of Business Acumen: IT professionals may lack business acumen, which can hinder their ability to understand and align with the goals and priorities of the organization.
IT Governance: Poor IT governance can also contribute to a disconnect between IT and business operations. This can result in misaligned priorities, inefficient use of resources, and difficulty in measuring the value of IT initiatives.
What role does communication and collaboration play in addressing the IT-business divide?
Communication and collaboration are essential in bridging the gap between IT and business operations. By improving communication, both IT and business can better understand each other's priorities and work together to achieve common objectives. Collaboration allows for the sharing of expertise and knowledge, leading to more informed decision-making.
What cultural shifts are necessary to bring IT and business closer together?
To bring IT and business closer together, organizations need to foster a culture of openness, trust, and mutual respect. This involves breaking down silos and encouraging cross-functional collaboration, as well as promoting a shared understanding of the organization's goals and priorities. IT and business leaders also need to work together to create a culture of innovation and continuous improvement.
Related Reading: How to Foster Innovation in Large Corporations
How can organizations ensure that IT is seen as an integral part of the business rather than a separate entity?
To ensure that IT is seen as an integral part of the business, organizations need to shift their mindset from viewing IT as a separate function to recognizing it as an enabler of business success. This involves involving IT in strategic decision-making, as well as ensuring that IT initiatives are aligned with business goals. It also requires IT leaders to have a deep understanding of the business, and for business leaders to appreciate the value that IT brings.
What are the benefits of a more integrated approach between IT and business operations?
A more integrated approach between IT and business operations can lead to a range of benefits, including improved operational efficiency, better decision-making, increased innovation, and enhanced customer experiences. By aligning IT initiatives with business goals, organizations can achieve greater agility and flexibility, enabling them to respond more quickly to changing market conditions. Ultimately, a more integrated approach can help organizations drive business growth and achieve a competitive advantage.