Six principles of The Technology Garden


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This presentation introduces the 6 principles documented in the book The Technology Garden, which presents how to deliver enterprise IT sustainably and with maximum business value.

Published in: Technology, Business

Six principles of The Technology Garden

  1. 1. The S Word Putting services at the heart of IT-Business alignment Jon Collins, Service Director Freeform Dynamics Ltd [email_address] July 2007
  2. 2. <ul><li>The 10000m view </li></ul><ul><li>6 principles of IT-Business Alignment </li></ul><ul><ul><li>… with services at the heart </li></ul></ul><ul><li>Applying the principles </li></ul>Agenda
  3. 3. The 10,000 m view: Three universal external forces are driving change <ul><li>Globalisation </li></ul><ul><ul><li>Customers, partners, suppliers – and competition </li></ul></ul><ul><ul><li>“ Connectedness” is driving sophisticated value chains </li></ul></ul><ul><ul><li>Everyone’s a service provider </li></ul></ul><ul><li>Transparency </li></ul><ul><ul><li>Industry regulations, consumer pressure and competition driving openness </li></ul></ul><ul><li>Smart, connected markets </li></ul><ul><ul><li>Ecosystem participants – particularly customers – see the “online world” as the natural place to look for information, services </li></ul></ul>
  4. 4. An emerging company model <ul><li>Business models evolving from “push” to “pull” – demand-led rather than supply-led </li></ul><ul><li>Organisations seeking out innovation, and looking in more places for it </li></ul><ul><li>Increased sophistication in the sourcing of business capabilities </li></ul>Desire to engage with smart, connected markets Drive for business transparency Forces of globalisation <ul><li>Shaped more by external actors than top-down strategy </li></ul><ul><li>Organic, flexible structures </li></ul><ul><li>Boundaries are porous </li></ul><ul><li>Process becomes the stable organising concept </li></ul>
  5. 5. Built-to-last IT diminishes in effectiveness over time Effective Partially effective Ineffective Over time, key change events impact effectiveness Effectiveness
  6. 6. The Nordic CIO view: IT benefits of alignment IT is increasingly business-driven
  7. 7. “ As an IT leader you can’t expect to take part in investment discussions as a peer unless you can demonstrate that you’ve got the basics right” - CIO, global FMCG supplier 1
  8. 8. Getting your house in order: innovation and efficiency have to go together <ul><li>Total IT budgets are not growing significantly </li></ul><ul><li>Investment in support of innovation can only come from successful efficiency measures </li></ul><ul><li>Moreover, efficient organisation of resources is a key innovation enabler </li></ul>Standardisation Consolidation Management process optimisation Before After Support for differentiating processes Support for non-differentiating processes Operating and maintaining existing investments If you don’t know where you are, it’s difficult to know where you can go next!
  9. 9. Bottom-up vs Top-down Making everything “just work” Making a real difference to business IT as bottleneck IT as foundation IT as differentiator INCREASED EFFICIENCY INCREASED EFFECTIVENESS
  10. 10. Moving from technologies to services Email Internet Application Desktop Server Network VS TECHNOLOGY COMPONENTS SERVICES
  11. 11. “ Really engaging with the business is a problem … getting ahead in IT has for too long been about knowing all about messaging middleware and not enough about being able to frame solutions to problems in terms of business strategy ” - Senior IT executive, global software company 2
  12. 12. A common language is essential IT Business ? “ Investment prioritised in terms of business need” “ Systems that deliver value to the business” “ Clear direction from the business about focus, strategy” “ Collaborative approach to implementing business change” A common, agreed representation of business activity, goals + A common, agreed view of how current and future IT provides structured services to support the business in this context
  13. 13. Services are at the heart of a common language – so what are they? <ul><li>Valuable </li></ul><ul><li>Reusable </li></ul><ul><li>Meaningful </li></ul><ul><li>Autonomous </li></ul><ul><li>Independent </li></ul><ul><li>Contract-based </li></ul><ul><li>Unique </li></ul><ul><li>… the business gets this stuff </li></ul>
  14. 14. Enterprise architecture is a key SUPPORTING element Enterprise Architecture process The wrong way The right way Stakeholder Stakeholder Stakeholder Stakeholder Stakeholder Stakeholder Enterprise Architecture process Stakeholder Stakeholder Stakeholder Stakeholder Stakeholder Stakeholder
  15. 15. “ Most IT guys are quite happy to be seen as ‘passive’ IT suppliers who just do their best. But this doesn’t fit with what the business leadership really wants from IT – they want IT to help with innovation and drive the business forward. ” - CIO, European Railway company 3
  16. 16. Develop peer relationships between business and IT <ul><li>Start with the CIO </li></ul><ul><ul><li>Is IT always dragged along like a ball and chain? </li></ul></ul><ul><ul><li>If the CIO isn’t close to the board, getting visibility of change at the right time is VERY difficult </li></ul></ul><ul><ul><li>IT has a unique cross-enterprise view of capabilities and constraints </li></ul></ul><ul><li>You *have* to have a balance of power </li></ul><ul><ul><li>Joint accountability and ownership </li></ul></ul><ul><li>Develop relationships at operational and managerial levels </li></ul><ul><ul><li>Proactively maintain business engagement throughout the investment lifecycle </li></ul></ul><ul><ul><li>It’s about understanding the business, and being visible </li></ul></ul>You can only make this work after you have real trust in IT from the business
  17. 17. Service managers, EA Practice and the Governance Board Business team Demand information Feedback Service provider Service provider Service provider Filtered, aggregated demand and feedback Governance board EA practice Investment input Project management conversations Project management conversations Service manager
  18. 18. “ Often, projects that should be funded to support key business objectives are sidelined in favour of ‘pet projects’” - IT Director, major financial institution 4
  19. 19. Work towards coordinated goals and objectives <ul><li>Serious IT governance agendas that push IT-business integration also push business unit - business unit integration </li></ul><ul><li>The service framework needs to extend beyond IT – is the business ready? </li></ul><ul><li>IT-dependent goals and objectives across business units have to be agreed to ensure that “execution gaps”… </li></ul><ul><ul><li>Strategy for change makes sense </li></ul></ul><ul><ul><li>But execution stays “stuck in a rut” </li></ul></ul>
  20. 20. The Governance Board needs teeth <ul><li>Centralised perspective on business and IT roadmaps </li></ul><ul><li>Requires top-level management sponsorship </li></ul><ul><li>Permanent members include the CIO, the CEO, the CFO and the CTO </li></ul><ul><li>Under no circumstances delegate ownership to middle management </li></ul>
  21. 21. “ You can’t enforce centralisation and control; you have to accept the complex organisation, and look to influence instead of control” - Director of IT, global investment bank 5
  22. 22. Manage IT as a business driven IT portfolio <ul><li>Service-based approach enables partitioning of IT into domains based on business priorities </li></ul><ul><li>Encompass current and past investments from the perspective of value delivery to the business </li></ul><ul><li>Create optimisations for individual domains </li></ul><ul><ul><li>Cost, flexibility, … </li></ul></ul><ul><li>Embrace “decentralised chaos” in some domains, as well as structure and control in others </li></ul><ul><ul><li>Apply appropriate governance structures by domain </li></ul></ul>
  23. 23. Different domains, different optimisations Strategy Management Execution Service1 Service 2 … … Service n
  24. 24. Central criterion is value delivery to the business Value Tangible benefits Cumulative value t0 Development costs Time Balance the requirement for short-term and longer-term value delivery
  25. 25. Hard decisions - shooting the dogs Bad Good Fit with service requirements Non-differentiating Differentiating Domain value Kill Transform Improve Maintain
  26. 26. “ Communicating your aims and objectives effectively to technology suppliers, pressing them to deliver what you need as a business imperative from technology, in a manner which isn't always textbook, has been our biggest problem. ” - IT Director, UK Payments Service Provider 6
  27. 27. Management consultants and other business advisors IT consulting firms, industry analysts and other pundits Realities of the current business environment Realities of the current IT environment Priorities, goals and objectives Systems & resource constraints Latest business ideas and fashions Latest technology ideas and fashions The reconciliation challenge
  28. 28. In practice, this means: <ul><li>Marrying service provision principles with external view of service providers </li></ul><ul><li>Differentiate suppliers by spend and criticality </li></ul><ul><li>Establish objectives by supplier type </li></ul><ul><ul><li>Look for instances of strategic misalignment </li></ul></ul><ul><li>Build trust with key suppliers </li></ul><ul><ul><li>Develop a win-win engagement plan </li></ul></ul><ul><ul><li>Actively decide how to treat non-key suppliers </li></ul></ul>
  29. 29. Applying the Principles
  30. 30. Goals build on each other Gain trust from the business Understand and reflect the business Engage the business Drive the business “ Trusted IT service delivery” “ Differentiated business support from IT” “ IT service management IN the business” “ Appropriate change and transformation” Stages reflect the maturity of the IT-business relationship
  31. 31. Core competencies for better alignment IT Governance Trusted service delivery capabilities Differentiated business support from IT IT service/relationship management IN the business Appropriate change and transformation Portfolio mgt BPM ITSM Capacity planning (people) Service engineering Capacity planning (infrastructure) “ Agile IT organisation” “ Agile IT capabilities” “ Agile srevice delivery” “ IT just works” Operational business engagement Enterprise architecture Strategic business engagement
  32. 32. Different stages, different priorities The IT organisation must get the basics right Create a common language Foster relationships with key IT suppliers Manage IT as a business-driven portfolio Work towards shared goals and objectives Establish a peer relationship between business and IT *** * * * * Gain the trust of the business * *** *** *** *** ** Understand and reflect the business * *** *** ** *** *** Engage the business * *** ** *** *** *** Drive the business ** *** * ** Key: Highly important Somewhat important Less important
  33. 33. “ Technology is dominated by two types of people…” <ul><li>“… Those who understand what they do not manage, and those who manage what they do not understand.” – Archibald Putt </li></ul>
  34. 34. Thank You Jon Collins, Service Director Freeform Dynamics Ltd [email_address] July 2007