Leverage Business Strategy Execution with IT
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This Slideshare presentation is a partial preview of the full business document. To view and download the full document, please go here: http://flevy.com/browse/business-document/leverage-business-strategy-execution-with-it-281 The "Deliver Business Value with IT" series provides a good overview and actionable material of the ways a CIO can provide valuable and effective support to your company strategy and leverages business model concepts to deliver business value from IT. Martin Palmgren propose an extremely solid piece of work that comes across as the A-Z reference of how to execute and implement IT strategy from a CEO and CIO level perspective." Executive Summary: The CIO and the IT Department need to position as premium provider of IT services and focus on value to cost. In order to avoid the "do we really need a CIO and IT department to bother us with technology when we can use the cloud?" the CIO has to ensure that the business strategy and business objectives are supported by IT (from a Business and IT architecture perspective). Where the IT Strategy support Strategy execution, "Time to Market", Cost Effectiveness and stakeholder expectations from an Executive, Business Unit, IT Management and IT Risk Management perspective.
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Leverage Business Strategy Execution with IT
- 1. . Copyright 2012 COMMUNICATE! To leverage Business Strategy execution with IT! - Focus on the execution of you IT Strategy! !! By Martin Palmgren, IT Strategy and Transformation Executive @ .COMMUNICATE 1
- 2. . Copyright 2012 COMMUNICATE! CEO, CFO, CIO, CTO, SVP, Architects, Strategy, Business Executives and the IT function in general. ! Target Audience! 3
- 3. . Copyright 2012 COMMUNICATE! BrightTalk Thought Leadership: http://www.brighttalk.com/community/it-service-management/webcasts?q=martin+palmgren ! Get your cloud strategy right: http://www.brighttalk.com/community/it-service-management/webcast/534/29211 ! Get your IT Service Strategy right: http://www.brighttalk.com/community/it-service-management/webcast/534/23630! Leverage Strategy with IT: http://www.brighttalk.com/community/it-service-management/webcast/534/22934 ! Cloud Computing: Fluff or Lightening? http://www.brighttalk.com/community/it-service-management/webcast/534/21892 ! Run IT as a Service Business! http://www.brighttalk.com/community/it-service-management/webcast/534/21389 ! In French: ! Cloud Computing : La tête dans les nuages?: http://www.brighttalk.com/community/it-service-management/webcast/534/21919 ! Baseline: Coût, Consommation, chargeback et contribution IT aux objectifs de l'entreprise : ! http://www.brighttalk.com/community/it-service-management/webcast/534/21388! Deliver Business Value with IT (the book) https://www.smashwords.com/books/view/290604 (the blog) http:// deliverbusinessvaluewithit.wordpress.com /! I also share perspective @ some of the top French Business Schools, notably EDHEC! International Thought Leadership! 5
- 4. . Copyright 2012 COMMUNICATE! IT supports new emerging business initiatives that will eventually form the business strategy as they succeed or fail! And the Run! The IT department perform 3 things well: 1) understand the needs of the business, 2) how to build and run applications that meets the needs of the business and 3) to run an effective infrastructure! IT supports the run and emerging business initiatives! 7
- 5. . Copyright 2012 COMMUNICATE! An end to end perspective on how to get your IT strategy right, and “Canvassed” with a Road Map.! To get your IT Service Strategy Right!! Service Strategy (ITIL) Delivery Capability (VALIT, COBIT, RISKIT, CMMI, eSCM) Architecture (TOGAF) Security (ISO 9001, 20 000, 27 001) 9
- 6. . Copyright 2012 COMMUNICATE! Leverage business strategy execution! • Demonstrate How IT Contributes to Business Objectives ()! ! ! !! !! ! ! - Common Problem Statement ()! ! - Common Problem Context ()!! ! - Proposition ()! ! ! - A Business (IT) Strategy Statement (What) ()! ! ! - A Business (IT) Strategy Road Map (How) ()! ! ! - A Business (IT) Service Strategy! ! ! - An (IT) Business Model! ! ! - A Business (IT) Value Proposition! 11
- 7. . Copyright 2012 COMMUNICATE! Objective of the session is to follow up on the call I had with Martin regarding the Global IT Planning needs:! • Support the development of a group-wide IT strategy! • Work with business entities to understand their business strategies and processes and ensure alignment of their IT strategies with the group-wide IT strategy! • Drive the development and implementation of IT policies and standards across the group! • Work with Audit and Internal Control to ensure compliance to Group policies and standards! • Implement IT governance forums, processes and controls, and manage the necessary communication channels and tools! • Implement Project Portfolio Management and deploy the necessary Project Management tools and practices! • Capitalize experience and define IT guidelines for Mergers & Acquisitions! • Build up strong organizational capabilities for strategic planning and IT governance ! Common Problem Statement! 13
- 8. . Copyright 2012 COMMUNICATE! Business Strategy! Demonstrate how IT contributes to business objectives! Business (IT) Strategy Statement (What) (1)!Business (IT) Strategy Road Map (How) (2)! Business (IT) Service Strategy (3)! (IT) Business Model (4)! Business (IT) Value Proposition (5)! Service strategy! Delivery capability! Architecture! Focus on strategy execution! Business Drivers ! Business Objectives! Supported by a formalised business process framework! Security! ROI with Total Cost of Ownership per user! Bottom line: This is how we will support business objectives with IT! Proposition! 15
- 9. . Copyright 2012 COMMUNICATE! Step 2! Build the As – Is To – Be picture of the IT Strategy Roadmap with a Gap Analysis both on a Global and local level to the granularity needed with a focus on execution (tactical perspective).! A Business (IT) Strategy Road Map (How)! 17
- 10. . Copyright 2012 COMMUNICATE! Step 4! Build (confirm) the IT Business Model to ensure that the local IT departments deliver to set standards from a Service Strategy, Delivery capability, Architecture and Security perspective. ! An (IT) Business Model! 19
- 11. . Copyright 2012 COMMUNICATE! Leverage business strategy execution! • As YOU meet Stakeholder Expectations Leverage Business (IT) Drivers and Objectives ()! ! ! ! ! !! !! !! !! ! ! - To execute effective Business (IT) Strategy ()! ! - Focus on “Time to Market” ()!! ! - Business drivers support Strategy Execution () ! ! - Demand and Cost Drivers are Effective when ()! ! ! - IT Support Business Objectives ()! ! ! - and meet Stakeholder Expectations ()! ! ! - IT Provides Competitive Leverage ()! ! ! - IT Delivers to Demand and Cost Drivers ()! ! ! - Business objectives are reflected in the IT Strategy Roadmap! ! ! - Business Continuity is Ensured ()! ! ! - Management decide to out / cloud source! 21
- 12. Strategy Execution! IT Infrastructure Portfolio Management! Application Portfolio Management! Service Portfolio Management! Enterprise Portfolio Management:! Process based IT Architecture! Project Portfolio Management ! Performance Management:! Process based Business Architecture ! Product / service life cycle management! Business Strategic Intent! Strategy Articulation! . Copyright 2012 COMMUNICATE! Time to Market! Cost Effectiveness! Cycle Time! Time to Market (Governance: Performance & Conformity)! Business (IT) Strategy Road Map (How)! Focus on “Time to Market”! 23
- 13. . Copyright 2012 COMMUNICATE! When IT is perceived to:! • Understand stakeholder expectations,! • Contribute to business objectives,! • Deliver services to business needs,! • Deliver value to cost.! Demand and Cost drivers are Effective! 25
- 14. . Copyright 2012 COMMUNICATE! To get the IT Service Management Fundamentals right:! • Focus on demand and cost drivers! ! • In a business perspective:! – Run IT as an effective service business! – Meet your customer needs, where! – Demand drivers are critical in the roll out of IT Service Management! • Deliver strategy execution! ! ! and meet Stakeholder Expectations! 27
- 15. . Copyright 2012 COMMUNICATE! Priorities from a Business Unit Management Perspective:! ! !! - IT supports the achievement of tactical business objectives! ! !! - IT delivers perceived added value services and at a reasonable cost! ! !! - IT delivers to service level agreements (commitments)! ! !! - IT investments positively affect business productivity and the customer experience! ! !! !! - We have a clear process vision towards which we expect the IT department to ! ! deliver : ISO 38 500, VALIT, COBIT, RISKIT, ITIL! IT delivers to demand and cost drivers! 29
- 16. . Copyright 2012 COMMUNICATE! Priorities from an IT Risk Management Perspective:! ! !! - The organisations assets and operations are protected! ! !! - Key business and technology risk is effectively managed! ! !! - Effective process, practise and controls are in place! ! ! !! !! - We have clear security objectives to which we expect IT to deliver: ! ! ! VALIT, COBIT, RISKIT, COSO, ISO 9001 ISO 20 000 / 27 000! Bottom Line: To leverage competitive advantage with new technology is “nice to have”, to keep the business systems running is mission critical!! Business Continuity is Ensured! 31
- 17. . Copyright 2012 COMMUNICATE! Leverage business strategy execution! • Focus on Business (IT) Strategy Execution () ! ! ! ! ! !! !! !! !! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! - To execute Business (IT) Strategy () ! - Focus on business objectives ()! ! - Stakeholder expectations ()! - And deliver competitive services to strategic focus ()! - The (IT) Business Model needs to be set ()! - Contribution to business objectives (is) demonstrated ()! - The realisation of outcome (is) tracked! - Effective execution (is) built ()! - and “Aligned” with a focus on ()! - “Total Cost of Ownership” ()! 33
- 18. . Copyright 2012 COMMUNICATE! How fast can we get our products and services to market “Time to Market” & how can the IT department support the business from a Cycle Time and Cost Effectiveness perspective. ! Focus on business objectives! 35
- 19. . Copyright 2012 COMMUNICATE! ! To run the IT business effectively and leverage the execution ! of the business Strategy and objectives with IT we need to make educated investments: 80% of the cost and a 100% of the value impact is in the execution process of the supported IT services over the entire service life cycle.! Conception, Realisation 20%! Run 80%! And deliver competitive services to strategic focus! 37
- 20. . Copyright 2012 COMMUNICATE! The IT service proposition is aligned to the business strategy when:! • ! • • • • • Stakeholder expectations are understood and IT propose a ! ! service portfolio that correspond to Demand and Cost drivers ! Business Contribution, Cost, Consumption & Chargeback is identified! Focus is on perfect order business transactions! Services are effective (demand and cost drivers identified)! Services are competitive (Benchmarked to Industry Market Forces)! IT delivers service innovations to improve competitiveness! ! ! Contribution to business objectives (is) demonstrated! 39
- 21. . Copyright 2012 COMMUNICATE! As IT Services are effective and stakeholder oriented to support: ! ! ! Mergers and Acquisitions (M&A) ! ! Data room Development! ! ! ! Data Centre Migration, virtualization! ! IT Transformation, To a Service Based IT Business Model! ! ! Shared Service Centres -, Outsource -, Cloud solutions & Benchmark! ! ! ! ! ! ! Synergies & consolidation options! ! ! ! ! ! ! ! ! ! GAP (As Is, To Be, ROI)! Effective execution (is) built! 41
- 22. . Copyright 2012 COMMUNICATE! Cost, Consumption, Chargeback! “Total Cost of Ownership” established with! 43
- 23. Strategy Execution! IT Infrastructure Portfolio Management! Application Portfolio Management! Service Portfolio Management! Enterprise Portfolio Management:! Process based IT Architecture! Project Portfolio Management ! Performance Management:! Process based Business Architecture ! Product / service life cycle management! Business Strategic Intent! Strategy Articulation! . Copyright 2012 COMMUNICATE! Time to Market! Cost Effectiveness! Cycle Time! Time to Market (Governance: Performance & Conformity)! A Confirmed Business (IT) Value Proposition! 45
- 24. Strategy Articulation! . Copyright 2012 COMMUNICATE! An Articulated Business (IT) Strategy with an IT strategy statement and plan, an “IT Strategy Roadmap” support business objectives ! ! ! ! ! ! ! ! ! Develop the Business (IT) strategy ! Translate the strategy ! Plan operations ! Execute processes and initiatives ! Monitor and learn ! Hold strategy reviews ! Test and adapt the strategy ! !! Set business objectives! Mastering the Management system, HBR 2008 / 01: P 65 – 79 adapted to context! 47
- 25. . Copyright 2012 COMMUNICATE! A Strategy canvas that articulates the “How to” execute the Business (IT) Strategy! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! Develop the Business (IT) strategy ! ! Define mission, vision and values ! ! Conduct strategic analysis ! ! Formulate strategy ! Translate the strategy ! ! Define strategic objectives and themes ! ! Select measures and targets ! ! Select strategic initiatives! Strategy Plan ! !! Strategy Map ! !! Strategy Canvas! !! ! GAP! !! ! RISK Analysis! !! ! Added Value Canvas! !! ! DARCI (Decision maker, Accountable, Responsible, Consulted, Informed)! !! Collaboration Scorecard ! !! Stakeholder Scorecard ! ! ! Strategy Articulation! ! A “Canvassed” roll out! 49
- 26. . Copyright 2012 COMMUNICATE! ! Develop the Business (IT) strategy ! ! ! Translate the strategy ! ! Define strategic objectives and themes ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! Governed by a stakeholder scorecard that captures critical success factors to meet stakeholder expectations ! ! Define mission, vision and values ! ! Conduct strategic analysis ! ! Formulate strategy ! Strategy Articulation! ! ! ! Select measures and targets ! Select strategic initiatives! Strategy Plan ! ! Strategy Map ! ! Strategy Canvas! ! Collaboration Scorecard ! ! Stakeholder Scorecard! ! ! ! Business Strategy ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! IT RISK! ! ! Business Operations! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! Does IT support the achievement of business objectives? ! What value does the expenditure on IT deliver? ! Are IT costs managed effectively? ! Are IT risks identified and managed? ! Does targeted inter company IT synergies deliver to schedule? ! Do we have a clear vision towards which we expect the IT department to deliver : ISO 38 500, VALIT? ! Does IT deliver perceived added value services and at a reasonable cost? Does IT deliver to service level agreements (commitments)? ! Do IT investments positively affect business productivity and the customer experience? ! Does IT contribute to the achievement of our business strategies? ! Do we have a clear process vision towards which we expect the IT department to deliver : ISO 38 500, VALIT, COBIT, ! Are the organisations assets and operations protected? ! Are key business and technology risk effectively managed? ! To Stakeholder Expectations! 51
- 27. . Copyright 2012 COMMUNICATE! Business (IT) Drivers! ! Business (IT) Drivers reflect strategy execution! Manage information technology Manage the Business of Information Technology! ! ! Develop the enterprise IT strategy Build strategic intelligence Iden0fy long-‐term IT needs of the enterprise in collabora0on with stakeholders Define strategic standards, guidelines, and principles Define and establish IT architecture and development standards Define strategic vendors for IT components ! ! ! ! ! ! ! Establish IT governance organiza0on and processes Build strategic plan to support business objec0ves ! ITIL: SERVICE CATALOGUE MANAGEMENT COBIT: PO1 Define a Strategic IT Plan Develop and Manage IT Customer Relationships Manage Business Resiliency and Risk Manage Enterprise Information Develop and Manage Information Technology Solutions Deploy Information Technology Solutions Deliver and Support Information Technology Services Manage IT Knowledge Defined (IT) Business Drivers! 53
- 28. ! ISO 38 500! COSO! ISO 20 000 / 27 000! VALIT! COBIT! RISKIT! ITIL! • Service Strategy! • Financial Management For IT Services! • Service Portfolio Management! • Demand Management! • Service Design! • Service Transition! • Service Operation: - Function, - Process! • Service Improvement! • Continuous Improvement! • Measure & Report! TOGAF! CMMI! IT CMF! eSCM! Six Sigma! Project Management: PMI, Prince 2! ! ! ! ! ! ! ! ! ! ! ! ! ! ! . Copyright 2012 COMMUNICATE! Business (IT) Drivers! With a possibility to validate return on investment of the roll out of the steps of the IT Service Strategy to confirm business cases for qualified decision making! ROI Driven Business Cases (GAP)! 55
- 29. . Copyright 2012 COMMUNICATE! Leverage business strategy execution! ! !! ! ! !! !! ! ! ! !! !! !! • Design the IT Service Strategy & Portfolio () ! ! - We focus on demand and cost drivers () ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! - Provide best in class services ()! ! - And solutions as needed ()! - To leverage competitive advantage ()! - To the Strategic Plan ()! - We need to connect information ()! - For qualified decision making ()! - To support the Business Architecture ()! - To Leverage competitive advantage ()! - & Benchmark Best Practise, with ()! - ROI Driven Business Cases (GAP) ()! - To Measure (IT) Strategy Effectiveness ()! 57
- 30. . Copyright 2012 COMMUNICATE! To business needs! 2. Market definition! • Customer base and demand is clearly defined: - Who is consuming what services! • Prices / SLAʼs for services are established and Internal rates compared to outside marketplace for IT (Make or Buy)! ! ! Provide best in class services ! 59
- 31. . Copyright 2012 COMMUNICATE! Provide clear guidelines! ! ! 4. Governance is in place! Best practices processes continuously improved! Governance blueprint designed and operating! IT investments reflect:! • • • • The strategic intent of the Board, ! Business goal and priorities, ! A clear IT portfolio of projects and services, ! A Service Portfolio alignment to business goals and priorities! IT investments deliver a good return on investment! The IT Steering Committee will initiate a strategic IT competitive analysis! To leverage competitive advantage ! 61
- 32. . Copyright 2012 COMMUNICATE! Projects! Contracts! Financial Budget! And Actuals! Business Cases! ?! Business goal! alignment! Chargebacks! IT Metrics! Resource! Allocation! IT Assets! IT Services! We need to connect information! 63
- 33. Strategic! Tactic! Operational! . Copyright 2012 COMMUNICATE! Strategy! ! Business & IT Vision Articulated! Process! Strategic! ! Business Architecture & IT Architecture Aligned and delivered to Strategic Intent! Tactic! Operational! Time to Market (Performance & Conformity)! Application support ! Vendor Driven! Execute Business Strategy! Business Architecture! To support the Business Architecture! 65
- 34. . Copyright 2012 COMMUNICATE! Leverage business strategy execution! ! !! ! ! !! !! ! ! ! ! !! !! !! !! • Perform Effective IT Management () ! ! - The IT Business Model support () ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! - Business Drivers and Objectives ()! ! - Execute Business Strategy ()! - Confirm Business Vision ()! - Articulate the Business Value Proposition ()! - Deliver the Business Architecture ()! - Translate the Business Vision to an IT Vision ()! - Set the IT Value Proposition Baseline ()! - Construct the IT Business Model ()! - Design the IT Value Proposition ()! - Build the IT Value Proposition ()! - To Perform Effective IT Governance ()! - IT Contributes to Business Objectives ()! 67
- 35. ! ! ! ! Acquire, construct and manage property ! Create and manage organizational performance strategy Benchmark performance Develop enterprise-wide knowledge management (KM) capability Manage change! Manage knowledge, improvement and change Build investor relationships Manage government and industry relationships Manage relations with board of directors Manage legal and ethical issues Manage public relations program Manage external relationships Determine environmental health and safety impacts Develop and execute environmental health and safety program Train and educate employees Monitor and manage environmental health and safety management program Ensure compliance with regulations Manage remediation efforts Manage environmental health and safety ! Design and construct/acquire nonproductive assets Maintain nonproductive assets Obtain, install, and plan maintenance for productive assets Dispose of productive and nonproductive assets Manage physical risk Perform planning and management accounting Perform revenue accounting Perform general accounting and reporting Manage fixed-asset project accounting Process payroll Process accounts payable and expense reimbursements Manage treasury operations Manage internal controls Manage taxes Manage international funds/consolidation Manage financial resources Manage the Business of Information Technology Develop and Manage IT Customer Relationships Manage Business Resiliency and Risk Manage Enterprise Information Develop and Manage Information Technology Solutions Deploy Information Technology Solutions Deliver and Support Information Technology Services Manage IT Knowledge Manage information technology Develop and manage human resources (HR) planning policies, and strategies Recruit, source, and select employees Develop and counsel employees Reward and retain employees Redeploy and retire employees Manage employee information Develop and manage Human Capital Develop customer care/customer service strategy Plan and manage customer service operations Measure and evaluate customer service operations Manage customer services Plan for and acquire necessary resources (Supply Chain Planning) Procure materials and services Produce/Manufacture/Deliver product Deliver service to customer Manage logistics and warehousing ! ! ! ! Deliver products and services ! Understand markets, customers, and capabilities Develop marketing strategy Develop sales strategy Develop and manage marketing plans Develop and manage sales plans Market and sell products and services Manage product and service portfolio Develop products and services Develop and manage products and services Define the business concept and long-term vision Develop business strategy Manage strategic initiatives Develop vision and strategy ! ! . Copyright 2012 COMMUNICATE! Time to Market! Cost Effectiveness! Cycle Time! Business Drivers and Objectives! 69
- 36. . Copyright 2012 COMMUNICATE! Vision! Articulate! Deliver! IT Vision! Baseline! Roadmap! Design! Build! Transform the Business Model! Vision! Vision:! - - - Articulate strategic intent! Business objectives! Business drivers! Confirm Business Vision! 71
- 37. . Copyright 2012 COMMUNICATE! Vision! Articulate! Deliver! IT Vision! Baseline! Roadmap! Design! Build! Transform the Business Model! Deliver! Deliver:! - - - Deliver the Business Architecture! Translate Business Architecture Vision to Business Architecture! Vision of Business Architecture “to be”: state “where we need to go”, “where we are now” & “how we need to proceed”! Deliver the Business Architecture! 73
- 38. . Copyright 2012 COMMUNICATE! Vision! Articulate! Deliver! IT Vision! Baseline! Roadmap! Design! Build! Transform the Business Model! Baseline! Baseline:! - - - - - - - - Set the IT Value Proposition Baseline! Set fundamentals of a service business! Process view! Establish Total Cost of Ownership and IT baseline with cost/value/risk! Activity based financial view! Service portfolio view! Value contribution view! Customer consumption view! Set the IT Value Proposition Baseline! 75
- 39. . Copyright 2012 COMMUNICATE! Vision! Articulate! Deliver! IT Vision! Baseline! Roadmap! Design! Build! Transform the Business Model! Design! Design:! - - - - - - - - Design the IT Value Proposition! Design the service strategy! Articulate governance principles! Define project teams! Engage customer ʻbuy inʼ ! Design KPIʼs ! Define & validate service pricing! Design the performance measurement system! Design the IT Value Proposition! 77
- 40. . Copyright 2012 COMMUNICATE! Vision! Articulate! Deliver! IT Vision! Baseline! Roadmap! Design! Build! Transform the Business Model! Transform! Transform:! - - - - - - - - Transform the Business Model! Measure KPI trends and targets! Meet business objectives! Control costs! Measure Delivery performance! Manage change! Continuous service & process improvement! Process roll out (articulation & integration)! - Execute strategic intent! To Perform Effective IT Governance! 79
- 41. . Copyright 2012 COMMUNICATE! Leverage business strategy execution! ! !! ! ! !! !! !! ! ! ! ! !! !! !! !! • With a strategy execution focused IT Service Strategy () ! ! - To build an effective IT Service Strategy, Get the ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! Business Architecture right () ! - To Leverage competitive advantage ()! ! - To Strategic Plan ()! - Stabilise ()! - Consolidate ()! - Institutionalise ()! - Lever competitive advantage ()! - With Business (IT) Strategy & Architecture ()! - That support strategy execution ()! - Articulated in an IT Business Model ()! - With Service strategy, delivery capability, Architecture and ! security ()! - With a focus on Business Objectives & Drivers ()! 81
- 42. Strategic! Tactic! Operational! . Copyright 2012 COMMUNICATE! Strategy! Process! We deliver competitive services, execute strategy effectively and measure the added value to optimise investment in IT!! Leverage competitive advantage! Strategic! Tactic! Institutionalise! Consolidate! Operational! Stabilise! Time to Market (Performance & Conformity)! Application support ! Vendor Driven! Execute Business Strategy! Business Architecture! To Leverage competitive advantage! 83
- 43. . Copyright 2012 COMMUNICATE! Understand Demand and Cost drivers! 1. Service definition! • Clearly defined portfolio of products and services and aligned to business goals and priorities! • Costs are understood for each service with a TDABC analysis for resource capacity, Asset consumption by service is established! • ! Best practice Asset Management practices are in place and IT leverages frameworks.! ! ! ! ! ! ! Stabilise ! 85
- 44. . Copyright 2012 COMMUNICATE! Shared Infrastructure! 3. Business proposition! Options are presented to management: In-house, shared services, outsourcing, cloudsourcing, etc! • • • • • Key IT projects deliver value as planned! Strategic IT opportunities are identified but not articulated! The Board will be presented with risk assessment decisions on critical initiatives! Position IT services in relation to the competition and industry! IT analyse competitor's IT initiatives! Institutionalise ! 87
- 45. . Copyright 2012 COMMUNICATE! Business Context! Business Strategy! IT Strategy! Business Operations! Business (Process) Architecture! Data Architecture! Application Architecture ! Technology Architecture! Business Value! With Business (IT) Strategy & Architecture! 89
- 46. . Copyright 2012 COMMUNICATE! Business Context! Business Strategy! IT Business Model & Value Proposition! Business Operations! Service strategy! Delivery capability ! Architecture! Business Value! Security ! For Effective Governance, Risk, Compliance! Articulated in an IT Business Model! 91
- 47. . Copyright 2012 COMMUNICATE! Business Context! Business Strategy! Business Objectives! Services! Business Operations! Business Drivers! Applications! Business Value! For Effective Governance, Risk, Compliance! With a focus on Business Objectives & Drivers! 93
- 48. . Copyright 2012 COMMUNICATE! ! Effective IT Performance Management! ! Effective IT Performance Management: enables the organisation to execute and deliver successful business strategy to set direction (vision). ! ! To execute strategic intent IT need to deliver Performance Management defined as Process based Enterprise Architecture to Interpret, model and articulate the business strategy from a process perspective where business objectives are levered by IT. ! ! Objective: ! - ! !! ! ! To evolve from a provider of IT to the designer of process that will support strategic intent to set objectives for the business levered by IT. ! ! Deliver effective Enterprise Portfolio Management with Process based IT governance solutions that focus on business objectives and on how to execute business strategy that levers formulated operating processes with best in class IT solutions. ! ! ! !! ! -! !! ! ! !! ! ! ! Facilitated by:! !! ! ! !! ! ! !! ! ! ! ! A Stakeholder Strategy Map in order to formalise stakeholder outcomes to deliver value for all parties (partnership) and a The Collaboration Theme Scorecard to set process objectives & Identify : levers for joint actions and wins, metrics and initiatives on a short, middle & long term basis.! “Canvas” the Business (IT) Vision! 95
- 49. . Copyright 2012 COMMUNICATE! Map Strategic Themes! 1. 2. 3. 4. Financial Perspective! Customer Perspective! Process Perspective! Learning & Growth Perspective! Create a High Performance Culture! ! ! !! !! ! ! ! ! Business (IT) Tactics! 97
- 50. . Copyright 2012 COMMUNICATE! ! ! The Stakeholder Strategy Map: Formalises stakeholder outcomes to deliver value.! ! ! Stakeholder Strategy Roadmap:! Objectives: ! !! ! !! ! Which drives! ! !! ! !! ! That deliver! ! !! ! !! ! Executes! ! !! ! !! ! ! !! ! - Formalise stakeholder ! outcomes: To deliver value for all parties (partnership),! - Customer value: For effective and satisfied end users,! - Business processes: Speed, process innovation and growth,! - Employees and organisation: Collaboration that deliver strategy ! execution.! ! !! ! ! Captured in a Strategy Map! Managing Alliances with the Balanced Scorecard, HBR 2010 / 01: P 114 - 120! 99
- 51. . Copyright 2012 COMMUNICATE! ! ! The Collaboration Theme Scorecard: Sets process objectives, Identifies : levers for joint actions and wins, metrics and initiatives on a short, middle & long term basis.! ! ! Collaboration Theme Scorecard:! Objectives: ! ! !! ! !! ! !! ! - Set process objectives,- Identify levers ! for joint actions and wins,- Identify metrics, Identify initiatives on a short, middle long term basis.! Levers:! !! !! !! ! ! ! ! - Joint: Steering committee, development committee, project teams, cross functional teams, process improvement teams, functional improvement teams.! ! ! ! ! ! ! !! !! Collaboration Theme Scorecard! Managing Alliances with the Balanced Scorecard, HBR 2010 / 01: P 114 - 120! 101
- 52. . Copyright 2012 COMMUNICATE! At the end of the day Business Executives take the decision to out / cloud source when:! • • • • • IT is not perceived to understand stakeholder expectations,! IT is not perceived to contribute to business objectives,! IT is not perceived to deliver value to cost, ! IT is not perceived to deliver services to business needs,! The IT department is unable to deliver services in a time to market perspective,! • IT propose an effective service portfolio that correspond to Demand and Cost drivers ! Deliver IT services to business needs! 103
- 53. . Copyright 2012 COMMUNICATE! As the IT department delivers effective IT Services and innovative technology solutions to improve competitiveness, demonstrated and articulated in:! • An IT Business Model “This is how we deliver IT services to the business”! • and a Business IT Value proposition This is how we support business objectives with services in a time to market perspective” ! ! ! and provides competitive leverage! 105
- 54. . Copyright 2012 COMMUNICATE! The material in this presentation is derived from identified “best in class practise” used by some of the worlds largest groups (Fortune 100 and 1000) and top performers within the IT domain. This walkthrough is a part of a set of reports proposed to provide pragmatic guidance on how to develop and execute your IT Strategy to support the Business Strategy and Business Objectives. Reference! 107
- 55. . Copyright 2012 COMMUNICATE! We work with a number of large French and International groups on the Business IT roadmap; that is how do we (as CIO, IT Department) support business objectives and processes leveraged by IT and an effective IT Services strategy.! .COMMUNICATE! 109
- 56. . Copyright 2012 COMMUNICATE! Martin Palmgren, EVP .COMMUNICATE – Deliver Business Value with IT / martin.palmgren@pscommunicate.com (mail)! Deliver Business Value with IT (the book) https://www.smashwords.com/books/view/290604 (the blog) http://deliverbusinessvaluewithit.wordpress.com /! CONTACT! 111