Defining Strategy and Business Alignment

In an earlier blog post, I discussed the concept of getting out of IT while you can.  The post was intended to be thought provoking. It was designed to challenge us as leaders to think about ourselves and our teams beyond the realm of Information Technology. I want to continue to challenge your thinking and focus on driving strategic value to our organizations. As we think about strategy, the first thing we need to do is to establish some foundational points:

• There is no such thing as IT Strategy alone. We can't lose sight of the fact that IT is a part of the business. The Strategy we drive with our IT resources must tie directly to the overall strategy of our business. If it doesn't, we are wasting our time, money and resources. This will most certainly lead to a failed effort to bring strategic value. 
• If you haven't already done so, stop thinking about IT being isolated from the rest of the company. Often times members of IT refer to the other parts of the organization as "the business". If this is how you or members of your team view things, I want to challenge you to think differently. Start thinking about it as your business.  I would submit IT is just as valuable to the company's success and bottom line as any other department within the organization.
• While it's easy to think about IT as a service organization, be careful not to see yourself or your team as subservient to those from other parts of the company. To bring this to a finer point, as challenging as it may be, stop the practice of referring to people from outside of the IT group as your customers. Refer to them as your co-workers. The main purpose behind this is to enforce the concept that IT is a peer of other department groups and can drive the business from a strategic perspective.
• That leads me to the term alignment. We often times hear ourselves saying that we must align our efforts to the business. Let's think about this differently. As we do,  by definition alignment means to give support. While supporting the business is important, I'd submit the real opportunity for IT is to lead the organization through times of change or disruption. 

Now that we have some foundational points in place, we can focus on ways to develop our strategy. So where do we start? I recognize it seems like a simple question to answer but I would suggest it's not quite as simple as it may appear. Have you ever been in a room filled with other executives that all share a common purpose of setting the strategy for the company yet it seems like no progress is made after hours, or maybe even days or weeks? Or worse, has anyone ever worked in an organization that didn't set any top down goals and objectives beyond making more money? As frustrating as this may seem, I don't think it's all that unusual. Think about it for a moment.  Different leaders across an organization likely have a unique set of goals and objectives. It's entirely possible that one leader's goals and objectives are in conflict with another's. This can lead to leaders and their groups working against one another in the effort to achieve their own goals.  Of course this may be at the expense of another set of goals and objectives.

The best example of this I can provide is when Microsoft first introduced a product called BPOS, the predecessor to Office 365. Part of the Microsoft organization was incentivized to drive revenue recognition through a perpetual licensing model. Basically doing things the way they were always done at Microsoft (and most everywhere else for that matter). At the same time, another part of the organization was incentivized to drive revenue recognition through a SaaS offering. Much of this driven by the need to compete with Google who was encroaching on Microsoft's core territory.  From my perspective, I saw two groups within Microsoft fighting against one another for my business. Both were uncoordinated and rather than supporting my business needs, they worked against one another. This made it very challenging for those of us responsible for managing a relationship with them.  Fortunately Microsoft recognized what got them to where they were at this point, wasn't going to get them to where the needed to go in the future. In essence they had to cannibalize the model that built their business in order to build a successful go forward strategy (their Cloud business).

As we get back to how to develop our strategy,  we should  seek to answer the following basic questions:

• What are the overall goals and objectives of the company? 
• What actions are needed to achieve the goals and objectives?
• How will we track our progress in support of the goals and objectives?
• How will we manage investments in people, process and technology?

Goals and Objectives

Let's use this example, the Head of Sales (CSO) usually sets a goal to generate additional revenues above and beyond the prior year. The CMO typically seeks to increase brand recognition. The CFO almost always wants to manage costs. The COO is seeking goals that support operational excellence, consistency and economies of scale. Not to be forgotten of course, the CEO wants to scale or grow the organization. He or she wants seeks to take the company to a new level. If we take these goals as absolutes, then what goals can a CIO establish to not only support the goals of other leaders but also to drive these goals? I'd submit a CIO set a goal to monetize innovation that would both support and lead the CSO, CMO, CFO and CEO. For a CIO, operating at the speed of the business is the key to monetizing innovation. Think about concepts like DevOps and Agile methodologies in this regard. 

Actions to achieve goals and objectives

At a high level, we need everyone rowing in the same direction. Watch a rowing team in action and you'll see every member on the team is in sync. It takes only a single member to upset the rhythm of the team. Our teams are no different. To that end, make certain everyone understands our goals and objectives. Furthermore, ensure team members understand that daily tasks must support one or more goals and objectives. If you or your team members are doing something that is not supporting one or more goals or objectives or worse is in conflict with one or more, than stop the behavior. Empower your people to ask why they're being given tasks that aren't supporting goals and objectives.

I like to use visuals for tracking performance. I find this works well especially for department heads and C-level team members. A simple one pager can help to show progress towards goals. My team uses balanced scorecards to do this. Our scorecards contain high level information on timelines, key milestones/ deliverables and some key performance indicators (KPI's) based on our financial and resource management. Our scorecards are published with consistency on our team site and help to provide visibility in to the things we are working on.

Managing Investments in people, process and technology

I'm a big fan of Robert Lemonis and his show on CNBC called The Profit. He refers to the P principle (People, Process and Product). I share his approach and always start with people because in my mind they are my most important asset.  I first assemble an inventory of the skills and expertise on my team. At the same time, I am assembling a similar list of skills and expertise I need to support the goals and objectives of the company. Invariably there's a gap. Where the gap exists, I define options for bridging the gap and ultimately managing the risks associated with the gap. There's many options for this, and I'd submit the proper approach will often be dictated by how aggressive your goals and objectives are. For example, if time is on your side, you may likely seek to invest in existing people and bridge the gap over time?  If time is not on your side,  you're likely to create new roles and begin to recruit them. In essence augmenting your bench with knowledge and experience. At the same time, you're likely to have to bring in contract labor, or hired guns to bridge immediate gaps.

The technology aspect of managing investments should ultimately be our core competency. Technology is an enabler of the business. That is if it brings value in some tangible way. Think back to the goals we discussed for the CSO, CMO, CFO, COO, CEO and ultimately how the CIO could support and lead each of them in pursuit of their goals. Innovation is a tricky thing sometimes. I find people tend to get overwhelmed by it. I often ask my team to provide examples of innovation. Nearly each time, they think big scale. I hear examples like Apple (iPod, iPad, iPhone, etc.). These examples are often followed up by the notion that it's difficult if not impossible to develop something as innovative as that. When I think of innovation, I think of it as either being revolutionary or evolutionary. If you go back to the Apple example. I'd submit that at the time of the release of the iPod, iPad, iPhone, etc. these devices were clearly revolutionary. Over time they've become evolutionary. If we work of this premise, look for simple ways to evolve your business. If your accounting team takes 10 days to close the books at month end and their goal it to reduce this to 7, then have your IT Business Partner walk a mile in their shoes and fully understand the process. Armed with this knowledge, the IT BP can come back to the rest of the IT team and look at ways to leverage the knowledge and experience of the entire team to achieve the goal. 

I recommend seeking opportunities for quick wins. They build momentum and ultimately the trust in the IT organization and us as leaders.

Think about the opportunity we have in front of us. Our company needs us now more than ever to lead and navigate through tremendous times of change. Change that can be disruptive to a company and maybe even detrimental to the financial well being. Think about what we've witnessed over the past 10 years. We've seen household names go by the way side, all victims of being disrupted by innovation. Blockbuster Video and Blackberry are examples of this.  It's even impacting the restaurant business where McDonald's and KFC are struggling to maintain relevancy in today's marketplace. We have also witnessed companies once thought to be leaders in their space being acquired by other entities. Last week's news that Dell was acquiring EMC is a prime example of this. I believe we live in a world where we will either be disrupted or be a disruptor. There is no better time than the present for the CIO to be the Chief Innovation Officer and Chief Integration Officer to drive the company through these challenging times.