Jeanne Ross likes to tell a story about an enterprise architect at an investment bank. “He proudly told me that despite the bank’s propensity for building siloed applications, the IT people were able to wire things together so that every single transaction was end-to-end. No human being ever touched a transaction. Then he paused and said, ‘It’s a miracle it works.’ The mission of my research,” says Ross, principal research scientist at the Center for Information Systems Research at MIT, “is to help companies understand architecture so that they don’t have to rely on technological miracles.”
Ross is well-qualified to provide companies with that assistance. She began researching the problem of information architecture and governance more than a decade ago, when CISR helped Johnson & Johnson through a period of enormous cultural change, as the company sought to rationalize its vastly diversified operations. The effort, she notes, “started my education on the critical role of the operating model in defining IT and business process capabilities.” Among the fruits of her research was “IT Governance: How Top Performers Manage IT Decision Rights for Superior Results,” coauthored with Peter Weill and published by Harvard Business School Press in 2004.
Editor Edward Baker recently spoke with Ross about her latest efforts to understand the relationship between corporate strategy, operating models and enterprise architecture. An edited version of the interview follows.
The mantra for years has been to align IT to business strategy. Are you rejecting that view?
I’m not rejecting strategy; I’m conceptualizing it differently. The problem is aligning IT with strategy, when strategy has all these different pieces: markets, products, prices, competitive advantage. There are so many things that make up strategy that it’s very hard for a CIO—or for anyone who’s trying to understand the capabilities IT needs to build—to align to it.
The operations view is a way of conceptualizing strategy as a fairly stable, longer-term vision, as opposed to an initiative. You have to separate the development of IT capabilities from every new strategic initiative that comes along because those new initiatives just send you here, there and everywhere. If you’re going to build agile organizations, you can’t build capabilities around every new opportunity. You really have to be thinking in terms of what’s not going to change. What’s going to change is unknown. What’s not going to change is actually fairly predictable. And a company’s operating model has to be aligned with the things you feel are fairly permanent in the organization.
The operating model is about who your customers are. It’s about what your service model is. It’s about integration standardization. Are you going to be a single enterprise, all marching to the same drummer and doing things exactly the same way, and sharing all of your data? Or do you actually picture how you operate differently?
For example, if your company has a solid customer base, and it looks like they are going to be your customers long term, then you can hardwire things into the company that establish who those customers are. Of course, sometimes when you change channels you change the customers. But being able to recognize what you thought was permanent, and now isn’t, helps in understanding the scope of the change. So the operating model is just a different way of conceptualizing strategy.
Story Guide: Picking the Right Strategy for IT to Support