Thursday, September 20, 2007

IT Alignment Confusion

I have just read an article on the "CIO Insight" website that reflects the utter confusion about what IT Alignment really is. In this article (see "Companies Falter at Aligning IT to Business" by Brian P. Watson at: click here to go to article:, the author differentiates between IT effectiveness and IT alignment.

By all accepted definitions, IT effectiveness is defined as "IT doing the right things" rather than doing things right (which is efficiency). Accepting that definition for IT effectiveness, it has been our experience that IT alignment and IT effectiveness are two sides of the same coin - therefore, they cannot be in conflict.

If IT is doing the right things, they are aligned with business strategy because the business strategy defines the "right things" that business should be doing and IT should be supporting.

Therefore, if you have a measure of IT effectiveness, you have a measure of IT alignment.

Our measure of IT Alignment/IT Effectiveness shows how well IT is supporting the top 3 business goals of senior business managers. We have tracked that measure for almost 25 years in almost 200 organizations and it has been consistent with improved profit margins, ROI, EPS, etc.

The definition of IT effectiveness used in this article is as follows: "getting projects done as specified, on budget and on schedule". This definition is consistent with the accepted definition of IT efficiency - e.g. how well it is doing the things it is doing -- doing things right.

According to this definition of IT effectiveness in this article is actually IT efficiency. As such, I completely agree with the results of the Bain survey quoted in the article as they are consistent with our data collected over this last 25 years. However, instead of comparing IT effectiveness and IT alignment, the article is actually dealing with IT efficiency and IT alignment -- two very different things.

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