Editorial: December 2001
Transforming Banks for a Digital Future: The Winners, The Losers, and the Strategies to Beat the Odds
What's so hard about getting IT and business on the same page when plotting and carrying out policies and strategy? Judging from the experience of JoAnn Heisen, CIO of Johnson & Johnson Inc., much of the problem revolves around the need to rejuvenate the entrenched structures and habits of years. "We are not a young company like Cisco or Dell, with a green field"so new as to be able to have just a few systems, she says. Indeed, J&J has hundreds, spread across 195 businesses in 51 countries. Heisen's four-year campaign to create a more centralized and efficient IT structure that can still respond flexibly on the local level is not yet complete. But she has formalized the critical procedures: "We created a back-and-forth between technology and business, and that's absolutely essential to getting everyone thinking about the same general goals and principles." (See "Case Study | Johnson & Johnson.")
Heisen has chosen to restructure J&J's technology organization around a federal approach to managing change. This federalized way of management centralizes certain IT functions while giving individual business units the power to make the IT and technology-driven business decisions that involve their particular strategic circumstances. That system, argues V. Sambamurthy and Ritu Agarwal of the University of Maryland's Robert H. Smith School of Business, is only one of seven potential ways to tie IT to overall corporate architecture. According to the findings of their recent study on new ways to manage IT, CIOs who seek to rebuild their operations must improvisethinking about the activities and abilities that make up their organizations as modular pieces to be integrated in an architecture that most closely fits the company's strategic goals and cultural and historical needs. (See "Modus Operandi.")
Looking ahead, it's worth asking whether the goal of aligning IT and business will also be served by a promising new technology called grid computing, which would let companies tap into idle computing power across the company, across industries and around the globe. In recent months, a variety of technology companies have stepped forward to help build an international computing grid that University of Chicago grid pioneer Ian Foster and IBM executive David Turek both agree might one day allow companies to get supercomputing power zapped to them over the Net as easily as they now flick on electricity from the electricity grid. Foster envisions a day when companies might also be able to sell their idle computing time as a source of new revenue. (See "Collective Brainpower.")
In all these discussions, the aim is to put technology and IT into the service of business needs and strategy goalsswiftly, flexibly and efficiently.
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