Alignment is a key issue for every company. But business and IT never seem to speak the same language. It’s a too-common scenario: The business unit needs IT to create some specialized software, and delivers some semi-specific specifications. IT staffers then create what they think the business unit wants. Of course, it almost never is.
So how can companies ensure that business units actually get what they need? Some, like DHL, the global transportation and air freight division of the $72 billion global logistics provider Deutsche Post, opt for business/IT liaisons. The company decided to reorganize its IT operations in 2004 when it realized it could achieve better economies of scale by appointing a new group to oversee technology projects, says Caroline Michiels, director of DHL’s program and solutions management department. “It boils down to economics. And keeping IT centralized lets us put certain metrics in place and really focus on delivering value.”
But not everyone agrees. Gunes Sahillioglu, a technology consultant whose firm, Excellix, advises large companies on managing their IT portfolios, believes that IT liaisons can serve a purpose during transitional periods such as mergers. But, he says, “we cannot overlook the fact that enterprises operate by way of processes rather than liaison units. In the long run, what enterprises really need is the enablers—in this case, IT—to be proactive and innovative partners to the business.”
Michiels admits DHL’s new governance structure still has some flaws. “Like any new model, we are working out the kinks. Getting detailed information about the cost of services, making sure we are only paying for the things we actually use, ensuring that the rules of engagement on a project are very clear, these are all challenges.” Still, she sees a definite benefit. “First of all, a programmer often cannot communicate to a business person in business terms. Second, managing every projects in one place gives us a lot of information about how these projects hang off each other. Neither IT nor the business has that companywide insight.”
That may be so, but Sahillioglu is still skeptical about relegating IT staffers to the backroom while others handle the business issues. “The days of throwing a requirement specification over a wall and expecting an IT product being thrown back are totally behind us,” he says. “Competitive costs from a globalized IT supply universe, coupled with time-to-market pressures, dictate a much closer working environment. CIOs are now in a position to orchestrate the move to this new environment.”