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September 14, 1998

Enablers & Inhibitors

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Prioritization of IT projects has consistently been cited as another important enabler of alignment. Companies that can't incorporate technology into their business strategy in a timely manner may fall behind competitors. A key to effective prioritizing is to define and support the IT governance processes mentioned earlier.

Inhibitors To Alignment
As for the key inhibitors, some are just the inverse of the enablers. The relative importance of the inhibitors is clearly different from the enablers. The most frequently cited inhibitors by IT and business executives were IT activities. A poor relationship between business and technology organizations and staff, and poor prioritization of IT initiatives, lead the list of barriers to alignment.

Executives rated the lack of a close working relationship as the No. 1 inhibitor. This gets back to IT managers understanding the business and business managers understanding IT, and the establishment of an effective IT governance process and effective marketing of the value of IT by CIOs.

Both IT and business leaders say IT executives must do their best to effectively prioritize their workloads or risk jeopardizing alignment and creating chaos within the organization. This is especially true given the growing complexity of systems and electronic-commerce alternatives that didn't exist a few years ago.

An example of the importance of prioritizing comes from the growth of the Internet. Many Internet service providers did not anticipate the Net's tremendous growth and consequently failed to prioritize technology acquisitions and build appropriate infrastructures. Some companies are learning through lawsuits and unhappy customers the importance of being well-prepared in today's marketplace.

Having business managers more involved in IT decisions and projects can help solve these first two inhibitors. Together, IT and business executives should assess the allocation of IT investments and ask, "are most IT resources allocated to the most important parts of the business?"

Another barrier is IT's inability to meet its commitments. Too often, IT is overwhelmed by all it has to do. Business executives and end users become increasingly upset that projects are late and over budget.

Recent studies suggest that up to 30% of IT projects are canceled before completion, 50% to 100% are over budget, and on average are 6 to 12 months late. Most of these problems are not technical but still have a significant impact on IT's credibility. They are the result of not adhering to basic project-management disciplines. Possible solutions include defining a change-management process, delivering smaller projects by breaking larger projects into smaller ones, and sharing project risks between IT and business.

IT managers' inability to understand the changing business environment was also named as a major barrier to alignment. Companies that don't invest in IT enhancements to increase customer satisfaction will fall behind their competitors.

Strategic alignment of IT and business has remained a major issue for more than a decade. While there appears to be no single strategy or combination of activities that will let a company achieve alignment, executives should work toward minimizing those activities that inhibit alignment and maximizing those that bolster it.

Jerry Luftman is executive director and distinguished service professor for the graduate information management program at Stevens Institute of Technology in Hoboken, N.J. He is author of Competing In The Information Age (Oxford University Press, 1996). Tom Brier, consulting instructor at IBM Advanced Business Institute, and Ray Papp, professor of MIS at Central Connecticut State, assisted in the preparation of this article.

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