Practical Analysis: In Support Of Aligning IT With The Business

My column last week was the sort of introductory missive that needs doing, but riveting reading it wasn't. It was particularly frustrating for me as I couldn't respond then as my colleague Bob Evans tackled one of his favorite subjects with a column titled "Stop 'Aligning IT With The Business.'" It's alignment with customers that counts, Bob posits. Bob talks about this a lot, and each time I become a little more confused by his reasoning. To my ear, it sounds like an engineer suggesting to skip the footers on a bridge and move right to the span. Sure, the foundation isn't glamorous, but I'd rather drive on a bridge with a good one.

Last year's top pick in the InformationWeek 500, National Semiconductor, provides a good example. What really caught our eye was National's Virtual Inventory system. With it, rather than each distributor having to hold in inventory new products that may not sell well, it simply shows the part in stock. Orders get funneled back to National, which, together with its shipping partner, gets the part from its global warehouse to the distributor. The distributor repackages it and delivers it to the customer. This is a huge advantage for customers as they see more (actually hundreds more) new parts. Distributors avoid the risk, and National builds loyalty by helping distributors succeed. Everyone wins.

As a proud IT team told this story, I wondered: Why not save some time and ship the order straight to the customer? Faces got serious and I was told that National is very careful not to interfere in the relationship between distributor and end customer. Doing so is the quickest way to put National out of favor with distributors. You see, I didn't know National's business well enough; I was thinking about things just from the customer point of view--not such a good idea.

National's IT team is also big on an intimate knowledge of its business. Each year, National's IT managers spend significant time away from their jobs out in the field, working side by side with business constituents--virtual inventory was developed out of one of those sessions. That dialogue goes on all year. National's IT pros don't assume that a static picture of the state of the business is sufficient, and they also don't assume that they'll understand the end customer as well as the people who serve those customers every day.

So since I've criticized Bob's prescription, I'll offer one of my own: National's model has sound IT governance at its core. If your organization's CIO and other IT managers haven't built into their processes a constant dialogue with leaders throughout the business, do that first. Once you've got that process down, start thinking about some customer alignment in conjunction with your now-very-happy business partners.

IT governance is a topic that often solicits eye rolls, as it conjures visions of copious documentation and excessive procedure, all with tenuous benefit. It doesn't have to be that way. InformationWeek Analytics has created a practical guide to IT governance, available now at governance.informationweek.com.

Art Wittmann is director of InformationWeek Analytics, a portfolio of decision-support tools and analyst reports. You can write to him at [email protected].

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