Business-IT Alignment:Getting IT AND Keeping IT - Kappelman & Pettit

L K l

SIM Enterprise Architecture Working Group - SIMEAWG

Leon KappelmanProfessor of IT, University of North Texas

Alex PettitAlex PettitChief information Officer, State of Oklahoma

SIMposium 2013, November 10 - 12, 2013 • Sheraton Boston, MA 2

(c) 2013 SIM International, Leon Kappelman, Primary Investigator

Bottom line – Remember this:

Business-IT Alignment is a partnership with at least two critical g p pdimensions: (1) Get Aligned and (2) Stay Aligned

To achieve business-IT alignment you must:To achieve business IT alignment you must:

1) KNOW the business’ requirements (from strategy to technical minutia)

2) DO Deliver systems that meet the requirements and are agile2) DO - Deliver systems that meet the requirements and are agile(quickly and cost-effectively adaptable)

3) ADAPT – Change quickly and cheaply [depends on 1&2]3) C a ge qu c y a d c eap y [depe ds o & ]• Keep knowing the requirements! The business is constantly changing, so its

requirements are too => Agile/adaptable requirements• Adapt the systems accordingly => Agile/adaptable systems• Adapt the systems accordingly => Agile/adaptable systems

4) ???

11/12/2013 3SIMposium 2013, November 10 - 12, 2013 • Sheraton Boston, MA

Agenda• The “Problem” of IT Alignment with the Business• What is the Essence of the Problem?What is the Essence of the Problem?• SIMEAWG Survey Results

I Y Abilit t G t d St Ali d• Improve Your Ability to Get and Stay Aligned• Questions? Discussion?


SIM’s IT Trends SurveyTop IT Management Concerns 2004 2013Top IT Management Concerns 2004-2013

Organization’s Top IT Management 2013 2012 2011 2010 2009 2008 2007 2006 2005 2004Concerns/Issues

2013 2012 2011 2010 2009 2008 2007 2006 2005 2004

Aligning IT with Business 1 2 1 3 2 1 2 1 1 1

Business Agility 2 3 2 2 3 13 17 7 5Business Agility 2 3 2 2 3 13 17 7 5

Business Productivity 3 1 4 1 1 7 4

Business Cost Reduction & Controls 4 Combined with “Business Productivity” in prior years

IT Cost Reduction & Controls 5 5 10 8 5 7 4

Time To Market / Velocity Of Change 6 Combined with “Business Agility” in prior years

Security 7 9 8 9 9 8 6 3 2 3Security 7 9 8 9 9 8 6 3 2 3

IT Service Delivery 8 New

IT Efficiency 9 10 6 3 6 Previously combined with “IT Reliability”

Most of the Top 10 (1 to 6, 10) are business concerns first.

y IT Reliability

Revenue Generating IT Innovations 10 4 9 6 8 17

Nearly all are about the alignment of IT with the business.SIMposium 2013, November 10 - 12, 2013 • Sheraton Boston, MA 5

The Problem of Alignment

Alignment of IT with the Business consistently

g

Alignment of IT with the Business consistently at the top of the list of IT executives’ key concerns:concerns:o Other priorities, technologies, issues come and go

o For almost four decades “practitioners, academics, consultants and research organizations have identified “ tt i i li t b t IT d b i“attaining alignment between IT and businesses as a pervasive problem” (Luftman & Kempaiah, MISQE Sep 2007)

E (k i ) A id t (d i )o Essence (knowing) vs. Accidents (doing) - Brooks

SIMposium 2013, November 10 - 12, 2013 • Sheraton Boston, MA

The Problem of Alignment (part 2)

Three issues are at the root cause of this problem:

g (p )

Three issues are at the root cause of this problem:1. Communicating effectively enough to partner with the business.

We call this “requirements gathering” or “requirements q g g qengineering”, but service-oriented professionals call this “knowing your customer and their needs.” Essence = Knowing

2 B ildi th IT l ti i h th t it i d t bl d il2. Building the IT solution in such a way that it is adaptable and agile enough to stay aligned with the ever-changing organization of which it is a part. This is the result of effective architecture and engineering. Accident = Doing

3. Performance measurement and incentives: People do what you inspect not what you expect Measuring the results affects theinspect, not what you expect. Measuring the results, affects the results. (“Hawthorne Effect” & “Heizenberg uncertainty principle”)

11/12/2013

7SIMposium 2013, November 10 - 12, 2013 • Sheraton Boston, MA 7

The Cost of an Error (Hay, 2003)ISDLC

KNOWING $1 StrategicPlanning

ISDLC

PLANNING

REQUIREMENTS$5 Requirements

Analysis

Essence

READY, AIM$20 Design

$100 ConstructionDOING

BUILD & RUN

$500 Transition

BUILD & RUN

EXECUTION

FIRE!

Accident

Both are essential. Focus ofSIMEAWG and this research is essence

$1000 Production

FIRE!

SIMEAWG and this research is essence.


Why Focus on the Essence (requirements)?

No matter how perfect the technology you deliver or how

y ( q )

No matter how perfect the technology you deliver, or how well you managed the project, if you fail to build a system that actually meets the users’ requirements, then you fail.“The hardest single part of building a software system is deciding

precisely what to build. No other part of the conceptual work is as difficult…. No other part of the work so cripples the resulting system if done wrong. No other part is more difficult to rectify later. The most important function that the software builder performs for themost important function that the software builder performs for the client is the iterative extraction and refinement of the product requirements.” – Fred Brooks (1986)

“Delivering the wrong software is often worse than delivering no software at all.” (Gerush 2010)

11/12/2013 9SIMposium 2013, November 10 - 12, 2013 • Sheraton Boston, MA 9

Two Types of Requirements Activities (RA)?SIM EA Working Group StudySIM EA Working Group Study

We separately measured both SA&D (RA in small) & EA (RA in large)We separately measured both SA&D (RA in small) & EA (RA in large)1. Systems Analysis & Design (SA&D) focuses on parts of organization:• Primary concern is optimizing a part of the enterprise, e.g., a specific software

t li ti i ti l ti it f ti di i isystem, application, organizational process, activity, function, or division.• SA&D typically involves the application of software and hardware to the business.

2. Enterprise Architecture (EA) is concerned with whole organization:p ( ) g• Primary concern is optimizing the whole of the enterprise.• How all the software systems, applications, hardware and networks fit together.• How the IT assets and the rest of the organization work together interdependently.• An EA includes and serves as the holistic context for SA&D.

We did it!! They are different!!

“If you are only trying to write a program, you don't need Enterprise Architecture.… However, if you are trying to create … an Enterprise, ... now

i t h t h A hit t ” J h A Z h (1997)


you are going to have to have Architecture.” – John A. Zachman (1997)

SIMEAWG Survey Results: ISD Improvingy p g

Latest survey conducted in Fall 2012 ISD (Information Services Development) Capabilities steadily

improving since 1996 [accident] Self Reported CMMI Maturity Levels Self Reported CMMI Maturity Levels

90%100%

60%70%80%

Level 3

30%40%50% Level 2

Level 1

0%10%20%


1996 2007 2012

Results: Requirements Capabilities Improvingq p p g

SA&D capabilities improved since ‘07 [accident, small]Means of self-reported requirements capabilities: 2007 & 2012 studies compared

2012Question

My organizations requirements capabilitiesand practices 2007 2012 Percent

ChangeNumber and practices … Change

7a are measured 2.99 3.00 0.3%7b are benchmarked against other organizations 2.36 2.56 8.4%7c are aligned with the organization’s objectives 3 90 4 01 2 8%7c are aligned with the organization s objectives 3.90 4.01 2.8%7d are highly disciplined 3.00 3.07 2.3%7e are valued by non-IT leadership 3.34 3.58 7.2%7f have non-IT leadership buy-in and support 3.57 3.37 -5.6%

7g are characterized by effective communication between stakeholders and the requirements team 3.21 3.65 13.7%

7h describe our present ‘as-is’ or current environment 3.52 3.61 2.6%7i describe our ‘to be’ or desired environment 3 60 3 64 1 1%7i describe our to be or desired environment 3.60 3.64 1.1%7l improve our ability to manage risk 3.61 3.75 3.9%7m contribute directly to the goals and objectives of our business plan 3.78 3.98 5.3%7n are well prioritized by non-IT leadership 3.34 3.99 18.0%

SIMposium 2013, November 10 - 12, 2013 • Sheraton Boston, MA12

7p have IT leadership buy-in and support 4.18 4.29 2.6%Overall Means (average of the question means) 3.42 3.58 4.7%

Results: EA Capabilities are Less Maturep

EA capabilities are less mature than SA&D [essence, large]2012

Question Number

My organizations requirements capabilities and practices …Q #72012

SA&D

Q #82012EA

PercentDifference

7a/8a are measured 3.00 2.61 14.94%7b/8b are benchmarked against other organizations 2.56 2.38 7.56%7c/8c are aligned with the organization’s objectives 4.01 3.53 13.60%7d/8d are highly disciplined 3.07 2.73 12.45%7e/8e are valued by non-IT leadership 3.58 2.81 27.40%7f/8f have non-IT leadership buy-in and support 3.37 3.01 11.96%

are characterized by effective communication between7g/8g are characterized by effective communication between stakeholders and the requirements team 3.65 3.08 18.51%

7h/8h describe our present ‘as-is’ or current environment 3.61 3.33 8.41%7i/8i describe our ‘to be’ or desired environment 3.64 3.29 10.64%7l/8l improve our ability to manage risk 3.75 3.45 8.70%7m/8m contribute directly to the goals & objectives of our business plan 3.98 3.48 14.37%7n/8n are well prioritized by non-IT leadership 3.99 2.62 52.29%7p/8p have IT leadership buy in and support 4 29 3 87 10 85%

SIMposium 2013, November 10 - 12, 2013 • Sheraton Boston, MA13

7p/8p have IT leadership buy-in and support 4.29 3.87 10.85%Overall Means (average of the question means) 3.58 3.09 15.90%

Summary of SIMEAWG’s Research Findingsy g

ISD capabilities maturing ISD capabilities maturing SA&D and EA capabilities can be separately measured

– this is huge!– this is huge! SA&D capabilities maturing SA&D capabilities more mature than EA capabilities We’re better at accident (ISD) than essence (SA&D) EA capabilities are weakest of allo This is key to the agility and adaptability of what we build/buyo This is key to staying aligned

Does this mean the alignment problem is being solved?


SIM’s IT Trends SurveyTop IT Management Concerns 2004 2013

Organization’s Top IT Management 2013 2012 2011 2010 2009 2008 2007 2006 2005 2004

Top IT Management Concerns 2004-2013

Concerns/Issues2013 2012 2011 2010 2009 2008 2007 2006 2005 2004

Aligning IT with Business 1 2 1 3 2 1 2 1 1 1

Business Agility 2 3 2 2 3 13 17 7 5Business Agility 2 3 2 2 3 13 17 7 5

Business Productivity 3 1 4 1 1 7 4

Business Cost Reduction & Controls 4 Combined with “Business Productivity” in prior yearsNOT ACCORDINGIT Cost Reduction & Controls 5 5 10 8 5 7 4

Time To Market / Velocity Of Change 6 Combined with “Business Agility” in prior years

Security 7 9 8 9 9 8 6 3 2 3

NOT ACCORDINGTO THE DATASecurity 7 9 8 9 9 8 6 3 2 3

IT Service Delivery 8 New

IT Efficiency 9 10 6 3 6 Previously combined with “IT Reliability”

TO THE DATAy IT Reliability

Revenue Generating IT Innovations 10 4 9 6 8 17

Most of the Top 10 (1 to 6, 10) are business concerns first.


Nearly all are about the alignment of IT with the business.

A 3rd Dimension to the Alignment Problem?Th P bl f Ali t ( t 3?)

SIMEAWG study data shows almost no use of performance measures for

The Problem of Alignment (part 3?)

y pS&AD or EA activities – a sign of immaturity

IT understands the business objectives (SIM IT Trends Key Issues 2013)2 B i A ilit2. Business Agility3. Business Productivity4. Business Cost Reduction5 IT Cost Reduction5. IT Cost Reduction

But IT is measured by IT objectives (SIM IT Trends CIO’s Concerns 2013): These get CIOs fired, not IT-Business AlignmentThese get CIOs fired, not IT Business Alignment2. Security3. Skill/Talent Shortage4. Extended Services Outages (Disaster/Recovery)g ( y)5. Implementation Failures (Project Prioritization)

Is this a sign that IT-Business Alignment capabilities are also immature?


Discussion: What Should Be Done Align requirements activities with business objectives

K th ill h D i d b ild t d t h• Know they will change: Design and build to accommodate change.• Ideally, one set of requirements artifacts [digital and integrated]: The

“architecture of the enterprise” is the holistic set of artifacts describing an enterprise o er time incl ding the strateg objecti es b siness entitiesenterprise over time, including the strategy, objectives, business entities, technologies, procedures, business rules, purpose, jobs and positions, processes, timings, policies, and data model(s).

Design/build/buy for change – adaptability and agility• ‘SA&D’ is about describing the parts• ‘EA’ is about describing how all those parts fit together in an overall, enterprise-

id t twide context. Align incentives with business objectives

• On-Time and On-Budget but built to an out-of-context requirement does not g qlead to alignment or help you stay aligned.

• The road to hell may be paved with good requirements. Requirements must fit to architecture, if agility and adaptability and staying aligned matter.


• This is the essence of what we as IT professionals do!!

Are we really aligning requirements with business objectives?business objectives?

For each context (SA&D and EA), my organization’s requirements, capabilities, and practices are viewed strictly as an IT initiative.

30.5%

20.8%


Improving Your Ability to Get & Stay Alignedp g y y g

Practices are improving, but more needs to be doneact ces a e p o g, but o e eeds to be do e Build your strengths, strengthen your weakness

• Assess and improve requirements practices and capabilities• Learn from and incorporate the organization’s stovepipes of EA-

related knowledge (e.g., strategy, continuity plans, HR, DRPs, cybersecurity audit policies & rules data etc ) into the requirementscybersecurity, audit, policies & rules, data, etc.) into the requirements repository (i.e., the SA&D and EA knowledge base)

Never forget that Internal IT is a not-for-profit services g porganization that should:• Help the value creators create value through innovation• Enhance business collaboration• Enhance business collaboration• Help management see/understand what was/is happening and the

implications of specific actions so they can make better decisions and f


use of resources

Bottom line – Remember this:

Business-IT Alignment is a partnership with at least two critical g p pdimensions: (1) Get Aligned and (2) Stay Aligned

To achieve business-IT alignment you must:g y

1) KNOW the business’ requirements (from strategy to technical minutia)

2) DO - Deliver systems that meet the requirements and are agile2) DO Deliver systems that meet the requirements and are agile(quickly and cost-effectively adaptable)

3) ADAPT – Change quickly and cheaply [depends on 1&2]• Keep knowing the requirements! The business is constantly changing, so its

requirements are too => Agile/adaptable requirements• Adapt the systems accordingly => Agile/adaptable systemsp y g y g / p y

4) METRICS & INCENTIVES matter a great deal – you get what you measure, you get what you pay for.

11/12/2013 20SIMposium 2013, November 10 - 12, 2013 • Sheraton Boston, MA 20

Conclusion

Thank You!Thank You!Q ti ?Questions?Discussion?Discussion?


Appendix 1pp

Self-Reported CMM ResponsesSelf Reported CMM Responses

CMM L lSurvey Year

1996 2007 2012CMM Level 1996 2007 2012Level 1 (Initial/Chaotic) 50.5% 29.9% 24.4%L l 2 (R t bl )Level 2 (Repeatable) 18.2% 38.1% 39.5%Level 3 (Defined) 18.2% 19.6% 25.6%Level 4 (Managed) 10 1% 11 3% 8 1%Level 4 (Managed) 10.1% 11.3% 8.1%Level 5 (Optimizing) 3.0% 1.0% 2.3%Total 2&3 36 4% 57 7% 65 1%Total 2&3 36.4% 57.7% 65.1%Total 2,3,&4 46.5% 69.1% 73.3%Total 2,3,4,&5 49 5% 70 1% 75 6%


, , , 49.5% 70.1% 75.6%

Appendix 2ppSpecific ISD capabilities generally improving too [accident]

S f C 200 & 2012Software Development Capabilities: 2007 & 2012 studies compared2012

Question Number

For software development and/or maintenance, our IS department specifies and uses a comprehensive set of processes and/or procedures for

2007 2012Change

From 2007

Percent ChangeNumber processes and/or procedures for … 2007

5b-1 establishing stakeholder agreement on requirements 3.83 3.97 0.14 3.7%5b-2 identifying the training needs of IS professionals 3.42 3.29 -0.13 -3.8%5b-3 establishing quality goals with stakeholders 3.55 3.71 0.16 4.5%5b-4 estimating all resource needs 3.55 3.76 0.21 5.9%5b-5 tracking progress and resource use 3.82 3.83 0.01 0.3%5b-6 software quality assurance 3.68 3.82 0.14 3.9%5b 7 continuous process improvement 3 51 3 47 0 04 1 1%5b-7 continuous process improvement 3.51 3.47 -0.04 -1.1%5b-8 coordination and communication among stakeholders 3.90 4.02 0.12 3.1%

5b-9 selecting, contracting, tracking and reviewing software contractors/outsourcers

3.83 3.86 0.03 0.8%

5b-10 analyzing problems and preventing reoccurrence 3.75 3.72 -0.03 -0.8%5b-11 tailoring the process to project specific needs 3.76 3.91 0.15 4.0%5b-12 continuous productivity improvements 3.47 3.44 -0.03 -0.9%

O ll M ( f th ) 3 67 3 73 0 06 1 6%


Overall Means (mean of the means) 3.67 3.73 0.06 1.6%

Business-IT Alignment:Getting IT AND Keeping IT - Kappelman & Pettit

Technology

Transcript of Business-IT Alignment:Getting IT AND Keeping IT - Kappelman & Pettit