The Era Of BT Changes How IT Assures Business Alignment Bobby Cameron Vice President And Principal...
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The Era Of BT Changes How IT Assures Business AlignmentBobby CameronVice President And Principal AnalystForrester Research
September 9, 2008
3Entire contents © 2008 Forrester Research, Inc. All rights reserved.
Agenda
• What is BT - and why doesn't IT's current approach work?
• How does BT change the business' expectations of IT?
• How are IT shops changing their organizations, technologies, and alignment processes to enable BT success?
4Entire contents © 2008 Forrester Research, Inc. All rights reserved.
Agenda
• What is BT - and why doesn't IT's current approach work?
• How does BT change the business' expectations of IT?
• How are IT shops changing their organizations, technologies, and alignment processes to enable BT success?
5Entire contents © 2008 Forrester Research, Inc. All rights reserved.
Business alignment is about matching resources
► Adjusting IT resources to match business demand for both existing and new technology services.
6Entire contents © 2008 Forrester Research, Inc. All rights reserved.
Today’s best IT executives manage IT-business alignment through a practice of “matching” . . .
• IT organizational structure -to- business units
• IT initiatives -to- business strategy
• IT budgets -with- business units
• IT initiatives -with- business processes
• The CIO -with- business peers
• . . .
7Entire contents © 2008 Forrester Research, Inc. All rights reserved.
But alignment presents constant challenges as CIOs strive to balance across three dimensions
Demand
• What business requests• Funds for new investments• Individual business units’ needs• Business plant, equipment, people
< to >
• What IT needs to improve• Legacy maintenance• Enterprise-wide processes• Technology investments
Focus
• Delivering new value• Outsource• Delivering business process change• Current business plans• Deliver new value the old way
< to >
• Re-architecting for future development• In-house staff• Reducing ongoing ops costs• External market forces• Upgrade staff skills
Change
• Emerging technologies• Agility• Business-value sourcing• New business models
< to >
• Existing IT architecture• Stability• Internal sourcing• Traditional business models
8Entire contents © 2008 Forrester Research, Inc. All rights reserved.
And business organizations are frustrated with IT
• Businesses are impatient with IT’s speed
• IT’s efforts to govern technology populism fail
• Technology is allowing users on their own to out-pace IT’s projects
Alignment becomes tough as IT’s design-build-maintain
approach isn’t working!
9Entire contents © 2008 Forrester Research, Inc. All rights reserved.
New technologies enable business users — without IT
• Tech populism — blogs, wikis, IM, handheld devices
• Assembling, composing, and configuring — business process management (BPM), information workplace (IW)
• Contracting — Software as a service (SaaS), business process outsourcing (BPO)
• All based on increasingly robust IT infrastructure and operations
10Entire contents © 2008 Forrester Research, Inc. All rights reserved.
We call this a shift to Business Technology (BT)
► Pervasive technology use that drives business results — increasingly under the control of business organizations
11Entire contents © 2008 Forrester Research, Inc. All rights reserved.
BT will bring a fundamental
change . . .
. . . not just another swing of the IT
pendulum
12Entire contents © 2008 Forrester Research, Inc. All rights reserved.
Non-IT staff drive the use of technology through roles previously found only in IT
Base: 186 global business executives
28%
34%
26%
28%
21%
30%
3%
3%
4%
3%
3%
2%
31% 25%
25% 15%
27% 19%
36% 24%
38% 24%
32% 21%
3%
3%
3%
10%
7% 16%
6% 19%
5%
12%
10%5%
Defining or designing the solution
Directly selecting vendor-offered solutions
Directly negotiating with and/or directly managing solutions
vendorsDirectly configuring solutions to
deliver what you need
Directly managing the technology solutions once in production
Directly managing projects with substantial technology involved
Completely other business areas’ (not IT’s) responsibility
More other business areas’ responsibility
Equal mix of other business areas and IT
More IT’s responsibility
Completely IT organization’s responsibility
Don’t know
Source: July 2007 US The Business View Of IT Online Survey
13Entire contents © 2008 Forrester Research, Inc. All rights reserved.
CIOs have to balance two competing aspects of increased business control of technology
Risky business control . . .
• Information integrity and consistency
• Assuring compliance, security, policy, and privacy
• Quality assurance
• Execution performance
. . . vs. business-control- driven opportunity
• User-driven speed
• Business agility
• Networked business models
• Founded on IT excellence
14Entire contents © 2008 Forrester Research, Inc. All rights reserved.
Agenda
• What is BT - and why doesn't IT's current approach work?
• How does BT change the business' expectations of IT?
• How are IT shops changing their organizations, technologies, and alignment processes to enable BT success?
15Entire contents © 2008 Forrester Research, Inc. All rights reserved.
Traditionally, IT handled the entire technology stack
Stable foundation and commodity technologies
Transaction systems, data warehouses — RDBMS, BI
platform — storage, servers — data center ops,
desktop maintenance
Dynamic and differentiated technologies X Internet,
multichannel, mobile, SOA
16Entire contents © 2008 Forrester Research, Inc. All rights reserved.
But with BT, business people deliver solutions
Historically, it’s all been IT. . .. . . but with BT, business people deliver dynamic, differentiated solutions
17Entire contents © 2008 Forrester Research, Inc. All rights reserved.
BT alignment requires that CIOs recognize fundamental changes in users’ needs
Traditional IT provides: BT users also need from IT:
• Solution analysis, design, delivery, and operations
• Solid business app platforms• SOA services for data,
transactions, policy, security, etc. • Deep technical skills on call• Support for BT tools • Operational support for BT
solutions
• Project management • Project support services• Help with skills development
• IT-centric technology • Open minds, support, & culture
• New technology R&D • Joint business innovation
18Entire contents © 2008 Forrester Research, Inc. All rights reserved.
Agenda
• What is BT - and why doesn't IT's current approach work?
• How does BT change the business' expectations of IT?
• How are IT shops changing their organizations, technologies, and alignment processes to enable BT success?
19Entire contents © 2008 Forrester Research, Inc. All rights reserved.
IT leaders face a fork in the road — Take it!
Focus mostly on traditional IT
• Letting business areas run ahead without you
• Getting stuck in the technology engine room
Focus heavily on enabling BT
• Empowering business success with managed risk
• Becoming a partner player
20Entire contents © 2008 Forrester Research, Inc. All rights reserved.
CIOs enable BT by enabling flexibility
From: To:
• IT/business alignment • BT synchronization
• Business results from large IT-led projects
• Business results mostly from small BT efforts
• Investments that cover much of the technology stack
• User investments in thin layers at the top tech stack
• Data and transaction investments deep in the stack
• Crisp lines between IT and business roles
• Fluid lines of responsibility between IT and the business
• IT-does-it-all • Business-user-enabling• IT has open minds and culture
• IT assures risk and policy • IT enables users to manage risk and policy
21Entire contents © 2008 Forrester Research, Inc. All rights reserved.
Today’s IT organization manages all technology . . .
IT Architecture
IT Strategy & Planning
CIO
Development IT OperationsIT Demand
Management
22Entire contents © 2008 Forrester Research, Inc. All rights reserved.
Technology Exec
Today’s IT organization manages all technology . . .
IT Architecture
IT Strategy & Planning
CIO
Development IT Operations
IT Demand Management
23Entire contents © 2008 Forrester Research, Inc. All rights reserved.
Technology Exec
. . . but CIOs must become chief BT officers, restructuring IT . . .
BT Architecture
BT Strategy & Planning
CIO
BT Synchronization
Business OrganizationsBusiness
OrganizationsBusiness Organizations
. . . as business orgs take on roles previously in IT
•Business analysis
•Project management
•Application configuration
•Information management
•Analytics delivery
•Security, compliance, risk, and policy assuranceDevelopment IT Operations
24Entire contents © 2008 Forrester Research, Inc. All rights reserved.
And IT-business alignment becomes BT synchronization
25Entire contents © 2008 Forrester Research, Inc. All rights reserved.
All top executives must help steer
26Entire contents © 2008 Forrester Research, Inc. All rights reserved.
The CIO will change to support BT enablement
Source: December 2008 “Next Up: The 21st Century CIO”
27Entire contents © 2008 Forrester Research, Inc. All rights reserved.
CIOs will focus more on partnerships — internal businesses, suppliers, customers, & competitors
Source: December 2008 “Next Up: The 21st Century CIO”
28Entire contents © 2008 Forrester Research, Inc. All rights reserved.
Checklist for successful 21-st century CIO
Source: December 6, 2007 “Next Up: The 21st Century CIO:
29Entire contents © 2008 Forrester Research, Inc. All rights reserved.
Bobby Cameron
+1 617.613.5708
www.forrester.com
Thank you
30Entire contents © 2008 Forrester Research, Inc. All rights reserved.
Related Forrester research reports
• February 22, 2008 “New IT-Business Partnership Enables BT Success — Centralized IT Control Fails As BT Moves Beyond IT’s Direct Control” by Bobby Cameron — http://www.forrester.com/Research/Document/0,7211,44019,00.html
• December 6, 2007 “Next Up: The 21st Century CIO” by Bobby Cameron — http://www.forrester.com/Research/Document/0,7211,43784,00.html
• June 18, 2007 “Debunking Alignment Nirvana” by Laurie M. Orlov — http://www.forrester.com/Research/Document/0,7211,42167,00.html
• May 7, 2007 “Business Technology Defined — Technology Management Is Changing To Deliver Business Results” by Laurie M. Orlov and Bobby Cameron — http://www.forrester.com/Research/Document/0,7211,42338,00.html