Table of Contents

Title Page




For Joanne, Alexandra, and Evan


The only thing to do with good advice is to pass it on. It is never of any use to oneself.

Oscar Wilde

These are times for transformation. The economy is shifting from recession to recovery. Companies are transitioning from cost containment to value creation. Chief information officers (CIOs) are uniquely positioned to help their organizations create a critical turning point by leveraging technology to drive innovation and business growth.

Whether you are an information technology (IT) leader or a business professional who leverages technology to help drive results, you will find that this book offers insightful and practical advice and strategies to help you maximize the effect of IT on your business. While the technologies constantly change at a dramatic pace, the practices I describe in this book are timeless and can help you transform your IT department from a mere order taker to a high-performance organization that delivers extraordinary business outcomes, despite this era of turbulent economic challenges.

To begin this journey, I examine the pressing questions that IT practitioners ask themselves and often struggle with answering: How do I truly partner with my business peers? How do I ensure that my team is focused on the right innovations? How do I deliver high-quality products and services that are embraced by my user community? What strategies should I employ to run my department like a business and measure performance? How can I manage and minimize risks so that my company can continue to operate effectively and protect its reputation—particularly in this era of social networking, mobilization, and cloud computing ? How can I attract, motivate, and retain a talented team that is focused on the same vision?

In this book, I share a framework that I have developed over my career that includes practical strategies and tactics to address these questions and help IT leaders truly transform their organizations. The framework involves seven steps:

1. Partner. Establish strong relationships with internal and external stakeholders to create long-term competitive advantage.
2. Organize. Define the organizational structure and processes needed to run IT effectively and efficiently so that it delivers value-added products and services, seeks continual improvement, and is prepared to adapt to business change.
3. Innovate. Build cost-effective and high-performance technology products and services that deliver value and are strategically aligned with business goals and objectives.
4. Deliver. Implement products and services to improve bottom-line performance for your company.
5. Support. Provide superior services to maximize the return on investment in business technology.
6. Protect. Manage and minimize risks so that your company can continue to operate effectively and protect its reputation.
7. Grow. Attract, motivate, and retain a talented team that works toward a common vision and mission.

Each step involves a set of practices designed to help you achieve success. The steps are interrelated and complement one another as part of an overall effort to establish a high-performance IT organization.

I have dedicated a chapter to each of these steps and described the best practices. I realize that every organization is unique and my strategies and tactics may not always fit the circumstances due to cultural, political, and organizational constraints. That being said, I have had the pleasure of working for eight companies, spanning seven industries, and have yet to come across a situation where most, if not all, of these steps could not be applied. I have also enlisted the help of IT leaders and other executives from a diverse set of industries and practices to share their strategies and stories in this book.

I promise you, this book is not filled with theoretical concepts or prosaic monologues; rather, it provides a comprehensive set of proven strategies, tools, and techniques. It's tiring to read all of those books, blogs, and articles that lecture IT leaders on getting a seat at the executive table but never explain how to actually do it. It is also frustrating to read a book or attend a conference and not walk away with salient points of advice that you can readily apply. For that reason, I conclude each chapter with a list of tips that I refer to as my Top Plays.

Everyone learns differently: some like theory, others enjoy reading interviews with executives, and still others prefer to stumble along and learn from experience. Will Rogers once wrote, “There are three kinds of men, ones that learn by reading, a few who learn by observation, and the rest of them have to pee on the electric fence and find out for themselves.”

In my experience, IT professionals generally appreciate structure and pragmatic advice. They have a predilection for methodology, process, policies, and templates. They want to face a chaotic world equipped with an orderly approach so they can enable their businesses to grow and prosper. I suppose that is why they entered the profession in the first place—it's part of their DNA. And with a field as dynamic and complex as IT, theory and entertaining anecdotes alone are not enough.

So for that reason, I decided to write this book: to create order from chaos and provide a comprehensive set of specific steps that IT leaders can take to deliver extraordinary results despite tumultuous times. Think of this book as the first how-to guide for creating a high-performance IT organization that delivers value-added products and services to employees, customers, and shareholders.

Leading an IT organization in an age when there is an unprecedented demand on technology to drive business growth requires CIOs to learn and apply these seven transformative steps. I want to arm leaders with the tools to get them started right away. For that reason, I have developed templates for each of the seven steps described in this book. The templates are straightforward and easily customizable by you or your staff to create similar documents for your own organization. They can be found on the companion website for this book (see the About the Website page for more information).


This book is a compilation of my work experience as well as the result of research that I conducted. I would like to acknowledge the many people who have helped me along the way.

First, I offer my sincere gratitude to the executives who participated in the interviews: Gary Boyd, Jeff Boyd, Rich Brennen, David Colville, Michael Del Priore, Greg Fell, Jim Gery, Jon Harding, Ken Harris, John Hinkle, David Kaufman, Richard Lattmann, Brian R. Lurie, Diane Montalto, Ken Murdoch, Kevin Nash, and Phil Schneidermeyer. I hope that this book captures your excellent insights.

Next, I would like to thank the many managers and mentors I have had during my career: Daren Bien, Michael Clifford, Jeff Hoffman, Ara K. Hovnanian, Holger Huels, Tom Lesica, Joan Pertak, Joanne Raimondo, Ron Rose, and J. Larry Sorsby. I am grateful for your good advice, counsel, and support.

I would also like to acknowledge my IT staff at Hovnanian Enterprises Inc. and the many members of my staff whom I have had the pleasure to work with throughout my career. I thank you for your passion, commitment, and drive to be the best at what you do. Without you, this book would not have been possible.

Many thanks to Sanjog Aul, Cecilia Biegel, Jon Hernandez, Mike Keizur, Hunter Muller, Kate Rood, Bethany Simpson, and Avery Wright for inviting me to lecture at industry events and forums and encouraging me to write. You helped me find my voice for this book, and for that I am deeply grateful.

I would also like to thank Sheck Cho, Kimberly Monroe-Hill, and Stacey Rivera, my editors at John Wiley & Sons, who believed in me and gave me such wonderful guidance and advice.

A sincere thank-you to the people that have inspired me to be socially responsible by inviting me to participate on academic and health-care boards: Serena DiMaso, Esq.; Dr. David Finegold; David L. Flood; Elizabeth Milewski; Thomas Setaro; Dr. Deborah Silver; Wendell Smith, Esq.; and Aleta You. The only thing you take with you when you leave this earth is what you leave behind, and I am grateful for the opportunity to serve my community.

I want to acknowledge the support and love of my parents. You have always been so supportive and have encouraged me to chase my dreams. I love you so much.

And thanks to my sister, Linda, for her love and support that mean so much to me. She typed my first report in high school. I should have asked her to type this book for me. She types much faster than I do.

I have also been fortunate to have a father-in-law and a mother-in-law who have supported me and shared invaluable lessons in life and business that have always guided me and still do today. And thanks to all of my sisters-in-law and brothers-in-law and their families, who keep me grounded–as only a large Italian family can do–and are a constant reminder of what's most important.

Most of all, I thank my wife, Joanne, for her unconditional love and unwavering support as I hunkered down in my home office to write this book on many evenings and weekends. And I thank my children, Alexandra and Evan, for being so understanding, loving, and supportive.

Chapter 1

Step 1: Partner

If we are together nothing is impossible. If we are divided all will fail.

Winston Churchill

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Partner: Establish strong relationships with internal and external stakeholders to create long-term competitive advantage.
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Your success greatly depends on your relationships with others. Whether you are trying to drive results within your team, with stakeholders across your company, or with suppliers, your ability to create positive business outcomes will rest on the strength of your business relationships. Partnerships begin with having a clear understanding of a company's vision, goals, and strategies. This chapter describes the stages of a business partnership and how to build an IT strategic plan, in cooperation with your team and business partners, so that everyone has a clear picture of the value IT will contribute to the company.

Partnership versus Alignment

Year after year, IT survey results inevitably state that one of the top priorities for the coming year will be to align IT with the business. The topic certainly gets a lot of attention and is often the source of many articles, postings, books, and presentations. Out of curiosity, I performed a search on Google, and it returned an astonishing 3.3 million results on the topic.

Why do so many CIOs struggle with alignment? Perhaps the answer is that they focus too much attention on aligning with the business rather than partnering with it. Are these just two different words with the same meaning, or is partnering in a different category altogether? Let's look at the definitions. Alignment is a state of agreement or cooperation. Partnership, however, is the state of being associates or colleagues. Partnership is about establishing strong relationships with internal and external stakeholders to create a long-term competitive advantage.

Given these definitions, alignment is being an order taker, while partnership is about people joining as colleagues in business—two very different relationships. Which relationship would you rather have with your fellow business leaders?

In successful partnerships, three common elements repeatedly and consistently emerge: impact, intimacy, and vision. Impact describes a partnership's capacity to deliver tangible results. Successful partnerships increase productivity, add value, and ultimately improve profitability. Intimacy is a challenging word; it conjures up images of people relating on an intensely close level. That's exactly what successful partners do in a business context. Successful partnerships also have vision: a compelling picture of what the partnership can achieve and, specifically, how it is going to get there.

Build Business Partnerships

There are three stages of a business partnership: earning trust, setting priorities, and creating business strategy. If you achieve these stages, you will ascend from merely aligning with the business to being a valued business leader in your organization. Let's take a closer look at how it works.

Earning Trust

The first stage in building a partnership is earning trust. Relationships may be built, but trust is earned—and it's necessary for a true partnership. Once you have demonstrated that you can be relied on to deliver real value to the company, you become a trusted supplier of products and services. The more value you deliver, the more credible and respected you become.

In order to earn people's trust, you have to know them. More important, they have to really feel that you know them and genuinely care about them. In fact, trust is the most important characteristic of an influential and intimate relationship. In the context of a business relationship, trust comes from a sincere conviction in the hearts and minds of your colleagues that you are working in their best interest and that you really know what their best interest is. Once you gain an understanding of what really matters to the business, it's time to come up with strategic responses to their issues.

I recently met with Michael Del Priore, the vice president and global CIO of Church & Dwight Company, the leading U.S. producer of baking soda. Founded in 1846, the company is best known for its Arm & Hammer brand, one of the nation's most trusted trademarks. It also makes a variety of other consumer and specialty products and operates internationally. Michael joined the company in the summer of 2009 and determined that the organization required a strategic-planning process, a governance model, and an organizational structure to partner with the business.

In response, Michael spearheaded an initiative to build a strategic plan for IT. He began by interviewing top executives and other business stakeholders across the company. “The interviews helped me introduce the ‘voice of the customer’ into the planning process with my team,” he says. Michael then spent a few months with his team to document a three-year plan and validate it with senior business leaders. Afterward, he conducted a town hall meeting with his full staff to announce the details. “A main theme of our plan was to transition from having country-specific IT to having a global IT organization, including platforms, processes, tools, and a new organizational structure,” he explains.

As a transformational CIO, Michael appreciates the importance of creating a governance framework and integrating IT into the decision-making process:

We didn't want to be in a situation where the business makes a request and we just react to it. We wanted our account managers to be integrated into the process and help develop the concepts and ideas. Having a documented strategic plan helps establish the context for making decisions on specific projects.

Setting Priorities

After becoming a trusted partner with the business, you can raise the ante and seek to become part of the priority-setting process at the operational level—the second stage of building partnership. The key here is to get your lieutenants to have a voice in the priority-setting operational committees. This stage helps you progress from order taking to priority setting.

A best practice is to create committees for each of your major business processes, such as sales, customer service, and accounting. These teams should consist of individuals from all across the company rather than being monopolized by corporate stakeholders. Assign an IT relationship manager to each of these committees to partake in discussions to help set priorities related to business processes. The IT relationship managers should have a full vote on proposals presented to the committees—accept nothing less. IT is in an excellent position to judge proposals, given its breadth of exposure to all major business processes and priorities.

Ken Harris is the CIO of Shaklee, the top natural nutrition company in the United States and the leading provider of premium-quality natural nutrition products, personal-care products, and environmentally friendly home-care products. With more than 1.2 million members and distributors around the globe, Shaklee currently operates in the United States, Mexico, Canada, Japan, Malaysia, Taiwan, and China.

Ken is a celebrated CIO with more than 25 years of success leading IT at high-profile companies such as Gap, Nike, and Pepsi-Cola. I recently caught up with Ken to ask about his view on setting priorities with the business. Here is what he told me:

It is imperative to have a prioritization process so that your department is working off the same sheet of music with the rest of the business. At Shaklee, we have two distinct but interrelated processes for setting priority and aligning with the business. The first is an IT strategic-planning process involving the executive management team. We meet on a monthly basis to review progress on existing initiatives, prioritize new opportunities, and calibrate the budget. The second process involves weekly meetings with the people at the next level down in the organization where we discuss progress and issues at a more tactical level. The process of communicating both at the executive and operational level on a frequent basis creates a level of intimacy necessary for developing a strong business partnership.

Maintaining a productive relationship with your business partners through frequent contact points appears to be an effective method to align on priorities for technology-enabled business initiatives. I met with other CIOs who share this philosophy.

Greg Fell is the CIO at Terex Corporation, a diversified global manufacturer in five business segments: aerial work platforms, construction, cranes, material handling and port solutions, and materials processing. Terex manufactures a broad range of equipment for use in various industries. Terex also offers financial products and services to assist in the acquisition of Terex equipment through Terex Financial Services. I recently got together with Greg and asked him to describe the IT governance practices at the company. Here is what he said:

An ERP system is less about technology transformation and more about business-process transformation. So when we began our ERP initiative here at Terex, we created a governance process that involved meeting with the business executives every other week for two hours to review progress and priorities. The frequency and amount of time we spend together has helped create awareness of the opportunities and challenges that we need to collaborate on. Now when projects cost a bit more or take longer than initially expected, the leadership team has a better understanding and appreciation of the issues. The meetings also help drive the ownership of the issues. And in many cases, issue resolution is owned by individuals outside IT.

It is important to ensure that every project in your portfolio has a measurable business case and is aligned with company goals. The committees can also be effective bodies for developing long-term strategic plans that represent the key objectives for each process area. Another important factor is that the committees should all be managed by a singular governance framework. The framework should be thoroughly documented and describe the purpose and process of setting priorities and objectives in support of company strategies and goals. See Chapter 3 for more detail on developing a governance framework.

Creating Business Strategy

The final and most coveted stage in the IT–business partnership is for IT to be viewed as a venerable part of the business. At this stage, IT and the business converge and are indistinguishable. To achieve this step, the IT leader in your company needs to sit on the steering committee responsible for creating the vision, goals, and strategies for the business. This committee provides the guidance and parameters for the priority-setting committees discussed earlier, since all priorities should be aligned with the company's overarching vision, goals, and strategies.

Getting a seat on the steering committee is not always easy, since IT still has an image problem in many organizations. IT has to get out from underneath the oppressive rock of being viewed as simply a service provider and transform into a true business partner. This is accomplished by demonstrating success with partnering and consistently delivering on the objectives defined by you and your peers. Remember, trust is earned—it's an achieved privilege, not an entitlement. Once your CEO sees that you can be counted on to deliver value consistent with the company's core vision, you will begin to earn your rightful seat at the table.

Rich Brennen is a partner at Spencer Stuart, one of the world's leading executive-search consulting firms. Rich built Spencer Stuart's global information officer practice and served as its global leader for over a decade. He has recruited more than 250 CIOs, including the top IT executives for the Walt Disney Company, the Allstate Corporation, Barclays, CIGNA, the Clorox Company, Juniper Networks, State Street, Kimberly-Clark, Walgreen's, and the Kroger Company.

I asked Rich to describe the qualities of a transformational CIO. Here is what he said:

Trying to describe a transformational CIO is like trying to describe a cloud. It's amorphous and depends on the view of the person describing it. For instance, one client may describe a transformational CIO as someone who can move their back-office IT to be more front and center in the business. Another client may describe it as someone who can help reduce IT costs or fix a failed outsourcing arrangement.

There is no rigorous definition of a transformational CIO, although there are certain themes that we keep hearing today from companies seeking new CIOs. The first is the CIO must be laser focused on the business. The new CIO role is as much of a business executive as the head of manufacturing, sales, supply chain, or any other function. Another theme is that clients are requesting a CIO who has run a business unit in the past or at a minimum has had some non-IT experience.

The best CIOs are indistinguishable from the other business executives in the room. If you were a fly on the wall listening to a discussion between the CIO and other CXOs for thirty minutes, you would not be able to identify the CIO as he or she is speaking about business outcomes and achieving business strategies. It's the CIO's job to leverage technology to enable the business, and the best CIOs discuss opportunities and challenges in business terms, not technical terms.

I met with Susan Miller, the CIO of a major sports franchise. Susan shares an interesting perspective on earning a seat at the table with the company's other executives. Here is what she told me:

When I joined the company several years ago, I had two major initiatives that I needed to address right from the start. The first was to transition from a decentralized IT organization to a shared service organization, including a new infrastructure platform. The second was to move headquarters into a new office building in Chicago that we had to design from top to bottom. The shared service initiative was an internal IT restructuring effort coupled with a technical architecture upgrade, requiring little involvement from the business. The new office building project involved having us work very closely with the business to design the layout of the new space and even the selection of the furniture—all of which required heavy interaction with the rest of the leadership team.

CIOs need to be comfortable with both ends of the spectrum. In one moment they may be working on a disaster recovery project with their team, and in the next moment they could be sitting next to the CEO working on the business plan. What people don't often realize is that success with the low-profile projects, such as higher network bandwidth, actually helps you earn the trust and credibility needed to gain a seat at the table with the rest of the business executives.

Trust is earned—it's an achieved privilege, not an entitlement.

I sat down with David Kaufman, the CIO of Aramark Corporation, a leader in professional services providing award-winning food services, facilities management, and uniform and career apparel to health-care institutions, universities and school districts, stadiums and arenas, and businesses around the world. In Fortune magazine's 2011 list of the World's Most Admired Companies, Aramark was ranked number one in its industry. Since 1998 it has consistently ranked as one of the top three most admired companies in its industry, as evaluated by peers and analysts.

David views strategic planning as a bottom up–top down process involving the development of an annualized portfolio of initiatives. He meets with the strategic committee, composed of people who directly report to the CEO, on a quarterly basis to review progress toward goals and set priorities and sequencing for each new initiative. As David describes it, “The quarterly presentations typically include a review of whether the initiative is on time, on budget, and producing the desired business outcomes. We also discuss the risks and mitigation plans for each of the initiatives.”

The key is illustrating how IT fits into the company's core vision. There are many ways of illustrating IT's alignment with the company's vision, but perhaps the best approach lies with developing a balanced scorecard and strategy map. In Strategy Maps, business strategy consultants Robert S. Kaplan and David P. Norton explained that strategy maps are a way to provide a uniform and consistent way to describe strategy, so that objectives and measures can be established and managed. A strategy map describes the logic of the strategy, showing clearly the objectives for the internal processes that create value and the intangible assets required to support them. The balanced scorecard translates the strategy-map objectives into measures and targets. But objectives and targets will not be achieved simply because they have been identified; the organization must launch a set of actionable programs that will enable the targets for all of the measures to be achieved.

Establishing a governance framework helps IT to identify and prioritize projects across the major business initiatives and processes. Due to the very nature of their jobs, CIOs inherit many projects as a result of partnering with their business peers. Documenting the objectives in the form of a strategic plan will help you describe how IT contributes to company strategy.

Develop an IT Strategic Plan

The planning process helps you to create and communicate your vision and allow people to understand their purpose in the organization. I recently attended the World Business Forum in New York City, where Gary Burnison, the CEO of Korn/Ferry International, a global leader in executive recruitment, gave a talk on talent management. Gary says that the number one reason people leave companies is that they don't understand how they matter. No one has told them how they fit in. He adds, “In this era, when self-interest trumps mutual interest, leadership defines how people fit into the journey.”

In Motivate Like a CEO, Suzanne Bates wrote, “As a leader, you have to learn how to communicate mission and purpose so that it makes sense to every single person in the organization. This can be challenging. You really have to get to know the individual and the group so you understand how to make the purpose relevant, exciting, and motivating for them. People need to see how they fit into the larger mission of the organization.”

I spoke with John Hinkle, the CIO of Take-Two Interactive Software Inc., a leading developer, marketer, and publisher of interactive entertainment for consumers around the globe. The company develops and publishes products through its two wholly-owned labels, Rockstar Games and 2K; 2K publishes its titles under the 2K Games, 2K Sports, and 2K Play brands. The company publishes such popular game franchises as Grand Theft Auto, Midnight Club, Red Dead Redemption, Max Payne, Bully, and Manhunt.

John believes it is important to connect the why with the what for his staff:

If one of my project managers is giving an update on a global network upgrade, you can always count on me to chime in and explain how the project is adding value to the business. I might say something like “The upgrade will mean that we can reduce the time it takes to transfer the latest game build to the QA Lab by 70 percent and save thousands of dollars in lost QA productivity.” When people have an understanding of why they are doing something, they tend to become more motivated to achieve the goal. I want people who work for me to understand why they are working on something and, more important, love what they are doing. If you just want to punch a clock, then I don't have a role for you here.

People need to see how they fit into the larger mission of the organization.

I recently caught up with Jim Gerry, the vice president of North America IT at Hyatt Hotels Corporation, a leading global hospitality company with a proud heritage of making guests feel more than welcome. The company's subsidiaries manage, franchise, own, and develop hotels and resorts under the Hyatt, Park Hyatt, Andaz, Grand Hyatt, Hyatt Regency, Hyatt Place, and Hyatt Summerfield Suites brand names and have locations on six continents.

Jim works with his team and business leadership to develop a five-year strategic plan. He feels strongly about vetting the plan with the executives and functional constituents at Hyatt so that everyone has a voice in influencing the IT strategies and objectives:

We have quarterly business reviews with the CEO and his direct reports to review progress toward current-year plans and how initiatives align with the five-year strategic plan. On a semiannual basis, we conduct an IT steering committee meeting with functional heads across the company to review current programs, projects, and priorities. This process helps to ensure that everyone understands the big initiatives and has a chance to weigh in.

The participants in these sessions have the opportunity to share what they think is working well, not working well, or what we should be working on. I have learned throughout my career that even the most well-thought-out strategic plans will need to change on a periodic basis to address changes in the business climate. What's important is you have multiple channels to listen to your team and your business stakeholders and adapt your plan accordingly.

How to Get Started

The purpose of an IT strategic plan is to define, in cooperation with the relevant stakeholders, how IT will contribute to the company's goals and the related costs and risks over time—usually three to five years. It includes how IT will help the business meet its goals and objectives by translating business requirements into technology products and service offerings while being transparent about benefits, costs, and risks.

An IT strategic plan typically includes:

The Sections of an IT Strategic Plan

Let's examine each of these sections to further describe the content to help you get started on your own IT strategic plan.

The Strategic-Planning Process

Strategy is not a stand-alone process; it is one step in a logical continuum that moves an organization from a high-level mission statement to the work performed by frontline and back-office employees. The development of an IT strategic plan should be managed as a project by the IT leadership team and include input from key stakeholders, staff members, and opinion leaders in the company.

A plan can be developed using six activities:

1. Defining the purpose of the plan
2. Capturing and evaluating business needs
3. Assessing the ability to support the needs
4. Developing the plan and the key performance indicators
5. Validating the plan
6. Communicating the plan

The project is followed by the ongoing activities of monitoring, governing, and managing to achieve the anticipated results.

IT's Vision, Mission, and Goals

Just as a company has a vision, a mission, and a set of goals, individual departments should create their own maxims to articulate how they fit into the overall picture. See Chapter 2 for more information on how to brand your department and set a vision, a mission, and a set of goals.

The Company's Vision, Goals, and Values

It's always helpful for the readers of your plan to be able to easily reference the company's vision, goals, and values. This way, it's clear to them that IT is aligned with the rest of the organization and not marching down a different path.

Mapping Business Initiatives to Business Goals

The next step is to have a clear understanding of how the business initiatives (e.g., a new marketing campaign) link to a business goal. This is where the planning process gets interesting. Unfortunately, many organizations do not take the time to document business goals, let alone business initiatives. Even some Fortune 500 companies haven't inked more than a vision and mission statement. Of course, this makes it difficult for individual departments to align their initiatives to the business.

If you find yourself in this situation, approach it as an excellent opportunity to exhibit your business chops and partnering abilities. Recruit the assistance of your direct reporters and process committees to document business goals and initiatives from their perspective. I have been able to use this grassroots strategy to influence corporate leadership teams to develop strategic plans, or at least convince other department heads to document their individual plans. You may ruffle a few feathers along the way, but people will eventually realize you have the best interests of the company at heart—and they will also become convinced that you're not just a technologist. Once you have the goals and initiatives documented, you can move on to the next step: to link IT strategies to the business initiatives.

Mapping IT Strategies to Business Initiatives

In this step, your objective is to define one or more IT strategies that can support each business initiative. For instance, if a business initiative is to launch a new consumer product, then you can describe IT strategies in support of that business initiative. The strategy is at a high level and does not describe the details to fulfill the requirements of the initiative—that is in the next step. To use the example of the launch of a consumer product we will call XYZ, an IT strategy might go something like this: Partner with the operational functions to provide the technology products and services in support of XYZ product launch.

Mapping IT Objectives to IT Strategies

Once you have all of your IT strategies documented, you can have your direct reports work with their teams to define the specific objectives for the next three to five years that will be used to address the strategies, further describing the IT partnership with the business. The objectives describe realistic targets for the strategy and should be developed using the SMART method. SMART is an acronym for specific, measurable, achievable, relevant, and time framed, the five leading measures of a strong objective—a realistic target for the strategy. The first-known use of the term was by George T. Doran in the November 1981 issue of Management Review.

As discussed earlier, it is important to help employees understand how they fit into the big picture. This task is accomplished by setting SMART objectives and assigning the objectives to individuals who will be responsible for executing them. In this way, the IT strategic plan and the individual performance plans are confluent. It's also a good practice to meet with your business partners and direct reporters on a periodic basis to recalibrate the strategies and objectives.

Setting SMART objectives aligns individual development plans with the strategic plan.

Categorizing IT Objectives by Domain (Business and Technical)

It is helpful to classify IT objectives into specific business-application or technical domains so you can analyze your portfolio according to the domains. The strategic plan doesn't just focus on business applications; it also includes the supporting infrastructure objectives. By classifying objectives into domains, you can see how the objectives from various functional areas can form a collection of actions that address a strategic outcome for the company.

For instance, an IT department may have one function to support sales objectives and another function to support customer service, even though the objectives are part of customer relationship management. Customer relationship management entails all aspects of interaction that a company has with its customers, whether they are sales or service related. By grouping specific objectives in the sales and service functions as part of that domain, you can analyze how you are addressing the needs of the customer.

Here is a list of examples of domains to consider for your strategic plan:

Business Application Domains

Technical Domains

IT Benchmarking Study Results

A popular way for IT departments to identify opportunity for improvement and competitive advantage is to compare its performance with other companies through benchmarking. It's helpful to include a summary of the benchmarking study results in your strategic plan to give readers an understanding of your strategies in relation to competitors or other companies of similar size. See Chapter 2 for a description of how to conduct a benchmarking study.

IT Trends

The purpose of the next step in the strategic plan is to describe the trends in the IT industry: the critical issues, opportunities, and challenges that all organizations face. The trends help IT departments make informed strategic and tactical decisions to better serve the needs of the business.

As part of the strategic-planning process, CIOs should have their function heads research the key trends for their area (i.e., the business application domains listed earlier). The following is a list of technology categories that serve as suggested areas of study for trends that are likely to have an impact on IT products and services: