Many organizations today are focused on aligning IT with business requirements to reduce IT costs, show the value of IT, and more effectively achieve business objectives. The primary drivers behind the quest for IT and business alignment include organizations needing a way to prioritize scarce IT resources and provide a common language between IT and the business.
IT executives understand IT value, but often struggle to communicate with line-of-business executives who fund IT in terms those executives understand. Effective communication requires knowing both how IT affects business and how business affects IT. In terms of the latter, management might ask, “What would it cost me to reduce my customer service response time by 5 seconds?,” “What will it take to get real-time quotes to insurance agents in the field on their laptop?,” or “Our competitors are going to do that; can we beat them to it?”
With regard to how IT affects management’s queries may be, “What is the impact on the business when a server goes down?,” “Is the server part of the IT infrastructure that touches a customer in some way?” “In a way that affects revenue directly?” All failures are important to address, but there are fires and then there are FIRES! IT must respond appropriately; how do you get started in aligning IT with the business?
One common strategy is Business Service Management (BSM), which combines IT methodology with technology solutions to help organizations effectively align and link their IT operations with business goals. BSM aims to address obstacles IT and business alignment such as reporting structure, the perception of IT, IT’s access to business planning, and business project prioritization.
IT/Business Alignment Cycle
One common methodology used in achieving BSM is the “IT/Business Alignment Cycle,” which introduces a simple framework the IT organization can adopt to manage a broad range of activities. The four phases of the cycle are:
- Plan with the business
- Model the infrastructure
- Manage operations
- Measure results.
Following this cycle fosters shared expectations between business and IT managers, and defines a common framework for activities that align IT and business objectives. The cycle also identifies best practices and common processes within and between IT functional groups to make IT and business alignment sustainable and scalable. This framework functions best when integrated and automated with software applications and monitoring tools.
Tested and Validated
An independent study conducted by Filigree Research of more than 240 IT executives, middle managers, IT middle management, and IT staff found a strong relationship exists between the IT/Business Alignment Cycle maturity and the participants’ assessment of their overall IT efficiency and alignment. The model used in the study was two-dimensional, consisting of the Plan, Model, Manage and Measure (PMMM) methodology, which we mentioned earlier and will discuss in more detail later, and a set of evaluation standards based on Gartner’s IT Maturity Model. (For more information on the model, see the May 2003 article by Donna Scott titled “IT Operations Management Is Undergoing Transformation” at www.bmc.com/ bsm/maturity.)
Research results indicated a strong relationship between IT/Business Alignment Cycle maturity and the participants’ assessment of their overall IT efficiency and alignment. It found that efficiency and alignment leaders had consistent management data, modeled their IT infrastructures on an enterprise level, and acted on integrated metrics and scorecards. Participants who rated high on IT efficiency and alignment showed a significant leadership in change management, and high quality management of the IT organization driven by a focus on service agreements.