Excellence in Business/IT Alignment
Lack of alignment between IT and the business is the #1 challenge that IT departments must tackle.
And it's the one headache companies don't need and shouldn't have.
Considerable research shows that excellence in any field - whether for an individual or a company - makes it easy to execute effortlessly, flawlessly, effectively, and quickly.
If you are known for excellence, you get the pick of opportunities. You get the right of first refusal. You get top billing.
Working hard will only take you so far. Focus on working smarter. Develop a Center of Excellence. Now, that's smart!
Ends don't justify means. The process of achieving goals is as important as the goals themselves.
With a bad process, you are not sure if the outcome was due to your effort or just attributable to good luck.
Governance is all about ensuring the entire business is focused on the right things, doing them the right way, doing them well, and obtaining the benefit.
The alignment between IT and the business ranges from Level 1 (non-existent) to Level 5 (perfect alignment). The majority of companies have pockets of collaboration and alignment that work for short durations. This is neither optimal nor scalable. This type of alignment is dependent on the right people - those with a mix of political savvy and leadership skills.
While this sounds ideal, the burden of hiring the right people and providing them the right incentives to stay with the company becomes a challenge unto itself. As Warren Buffett famously said, “You should invest in a business that even a fool can run, because someday a fool will.”
An ideal alignment framework will ensure the company doesn't require heroes to survive or allow fools to destroy it.
A COE brings together the necessary ingredients for creating and sustaining a DNA of excellence in the company. So what? Why is excellence an excellent goal?
* Increase the number of successful projects by 25% within 2 years of adopting a project management COE (as found by a PMI study)
* 67% of companies that reported clear and measurable benefits had formal COEs (according to a Forrester study)
Sixty percent of any COE is domain-independent - the majority of work deals with the common framework and mechanisms for skills and competencies, business capabilities, aligning tactical activities to strategies, managing risk, and governance.
Several studies have shown that investors are willing to pay a 20% premium for those companies that have governance programs (McKinsey, 2000) and that "...focused strategies and above average IT governance had more than 20% higher profits...compared to firms that had the same strategies" (MIT's CISR, 2004).
What are the 4 R's of a good governance program?