For many years, technologists focused on ‘business-IT alignment’, to ensure that IT investments supported business strategy and delivered business value. ‘Alignment’ suggests that IT and business goals are different entities, however, which creates issues of its own.
When business and IT strategies are not aligned, shadow IT flourishes. Business leaders who consider their centralized IT function too slow to act take matters into their own hands and invest directly in technology without involvement from their IT team. This creates a short-term solution, but usually it doesn’t take long before problems arise. The solution that was oversold by a vendor or overbought by the business executive does not deliver the promised business value. The lack of integration of process and data with existing transactional systems limits the usefulness or accuracy of the solution. Compliance with cybersecurity, privacy guidelines or regulations is lacking and difficult to realize as an afterthought. Often, the effort and skill required to run and maintain the solution is grossly underestimated.
Digital transformation – more than any other business change – therefore requires a much stronger integration between technology and business leaders.
Companies with this history of strained IT and business relationships are handicapped when trying to conduct digital transformations. These companies often have issues common to those that do not govern IT well – namely complex IT architectures, unintegrated data and processes that are not well-enabled through technology. In contrast, companies with a strong IT-business relationship are in a solid position to undertake digital transformation programs that lead to ‘fusion’ instead of ‘alignment’. In the most advanced organizations, it becomes impossible to identify where IT stops and business starts, often thanks to the creation of Agile ‘fusion’ teams.
For organizations that have not yet reached this stage of digital transformation, building mutual trust and shared understanding with IT executives can help business executives to meet their goals, by encouraging IT professionals to suggest high-value, strategic innovations. Where strong relationships exist, executives on both sides of the relationship are willing to be flexible in creating new governance mechanism or digital units.