What IT, Business Really Think of Each Other

First the good news: Business and IT leaders are bullish on technology. Three-fourths of the business and IT leaders responding to a recent survey view IT as critical to competitiveness or essential to managing business risks and costs, and approximately 60 percent of those polled believe that IT-enabled initiatives deliver acceptable or great ROI.

Now, here’s the catch. The survey, conducted by Valuedance with support from Harvard Business Review, shows that although business and IT leaders largely believe that IT is important and generates good value, the vast majority don’t feel that they are doing a good job leveraging IT.

For a current definition of “IT smarts,” we’ll let the respondents’ words speak for themselves: “IT smarts” is understanding how to get the most out of the systems in place, having insight into what technology can do and where it is headed, and the ability to work with IT to make IT-enabled strategy, invest responsibly and deliver complex solutions.

Only 20 percent of the respondents gave IT and business leaders a grade of “A” or “B” for how well they have leveraged technology. Only 25 percent of business leaders consider themselves IT-smart, with around 50 percent of business leaders admitting that they make half-baked requests, they want it all–regardless of ROI–they change their minds about what they want their systems to do and they don’t know how to use their systems.

Only 10 percent of business and IT leaders say their organizations have adopted important IT leadership practices–in which business leaders justify technology investments, technology strategy is defined as part or driven from business strategy, and business leaders knowledgeable about the technology in place drive IT-enabled change. Additionally, less than 10 percent of their companies hold business leaders accountable for delivering IT-enabled business value.

This situation brings to mind a story about a 5-year-old girl’s enthusiasm for soccer. Once after her team lost a game, she climbed into her family’s car and exclaimed, “My team is really good at soccer and always wins.” While the enthusiasm was encouraging, facts tell a different story. The entire team swarmed around the ball and always lost. No one knew how to play the game, no one kept score, and everybody got a trophy at the end of the season. Likewise, the leaders in our organizations are enthusiastic about the IT game, but they admit that they don’t really know how to play and are judging their success based on feelings rather than facts.

Furthermore, business and IT pros don’t always see eye-to-eye on how each other is playing the game. Plus, their perceptions differ on 50 percent of the following classic IT stereotypes: IT leaders are business-smart, IT is expected to know the business better than the business does, and the business always changes their mind about what they want their systems to do. As a positive side note, business and IT leaders believe IT is spending money responsibly and appropriately leveraging outsourcing and effectively managing outsource providers.

As leaders get smarter about IT, they increase their adoption of key IT leadership practices and start breaking through the negative stereotypes. For example, in organizations with IT-smart IT and business leaders, ROI is acceptable or great (93 percent), business leaders drive business change associated with IT-enabled investments (90 percent), and IT products and services meet the needs of the business (88 percent).

Unfortunately, it appears that some stereotypes are more difficult to change than others (such as the perception that IT is overly bureaucratic and control-oriented, and IT doesn’t deliver on time) when improvement doesn’t occur until both business and IT leaders get IT-smart (i.e., receive a grade of “A” or “B”).

Even the smartest organizations aren’t playing the game at a high enough level. In these “A” and “B” organizations, only 59 percent are using technology to gain a competitive advantage, the adoption of key leadership practices is spotty and negative stereotypes persist.

While it’s clear that IT-smart organizations play the game better than those who aren’t as smart, the best of IT is surely ahead as there remains significant opportunity to define new practices for managing the IT asset to ensure that it is fully exploited to the benefit of the enterprise.

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