As CIO, you are faced with multiple conflicting demands, all of which seem critically important.
Your developers want to work using the latest methods and technologies, HR demands performance appraisals and training plans, the business needs to be delivering bottom line results, users want unfailing support, vendors demand continuous version updates, auditors seek governance, then there's the monthly reports that ensure you report on work being done rather than just simply getting the work done, and so it continues.
While it is possible to pay some level of attention to all these pressures, it is normally not possible to do full justice to all of them. A balancing act is required to keep the function/department optimally productive.
It is sometimes necessary and worthwhile to hold a strategic review of the IT function, to ensure this balance is correctly aligned and maintained... but the process of holding a strategic IT review is a story of its own.
Regardless of how you divide your energy between all these competing demands, there is one area that absolutely cannot be neglected when running an IT department - that of Strategic Project Prioritisation.
A major leverage area, for the following reasons:
1. Business strategy alignment
When deciding on high-level project priorities, it is critical that IT has an in-depth understanding of both the business strategy and the strategic implementation plan. In the financial services industry specifically, strategy implementation inevitably has a significant IT component. The Strategic Project Priority discussion between business and IT results in better joint alignment to the strategic implementation plan, as well as a common understanding of the trade-off decisions required.
2. Common focus (the invisible hand)
When agreeing the project focus with the business, agreement of which projects are off the list is just as important as which projects are on the list. An agreed project focus empowers IT to work on fewer things, thereby significantly reducing the complexity curve, which increases exponentially with the number of projects run in parallel. But even more importantly, if the priorities are well communicated to the business, the business is empowered to support the projects currently under way by providing positive input and feedback. If everyone understands the priorities, and timelines and expectations are properly managed, then the business can better manage the gaps that are not being addressed by the current priority list, by investing in manual workarounds or controls. With business and IT working in concert, owing to the shared understanding of priorities, the overall business impact is greatly enhanced.
3. Expectation management
One of the greatest challenges for any CIO is to deliver what is expected. By “trying too hard” to meet the many parallel business demands, the CIO is likely to fall short in delivering what the business needs, as opposed to what it wants. If IT and the business strategy are aligned, priorities agreed and communication takes place, the focus is clear. All that is then needed is an ongoing commitment to be transparent and to continue communicating, because it's vitally important to manage the expectations of all stakeholders on an ongoing basis. Improved relationships and better long-term delivery then complete the true virtuous circle.
4. Business alignment vs IT department efficiency
It is useful for IT organisations to map themselves on the grid below. Many IT departments have significant projects designed for improving their internal efficiencies - such as the introduction of better methodologies, frameworks, technologies etc. But these initiatives are seldom useful in the absence of clear alignment with the business. Running fast in the wrong direction is not helpful, and can cause accidents!
5. Management of long and short-term conflicts inherent in delivering application systems
Having stated that business strategy should be the main driver of ensuring IT delivery is optimised, it is also critical for the business to understand the inherent conflicts between the short-term nature of business strategy, and the long-term nature of IT application platforms; which could potentially exist for many years, if not decades. The architectural and technological update investments that are required to maximise the longer term return on the application must also be considered when deciding on priorities. Strategic project prioritisation can therefore assist in ensuring a reasonable percentage of the overall project portfolio is allocated in this direction, despite the many short-term business and technical priorities that are not making the priority list.
How to do strategic prioritisation - some pointers
Having provided the rationale for strategic project prioritisation, the next question is: “How do we get this right?” My years of experience have taught me a few things:
* Ensure your business and IT structures are aligned from a decision-making perspective. If the IT structure is centralised, and the business structure is decentralised, strategic prioritisation is much more difficult, and key trade-off decisions are often taken by IT out of necessity. Ideally, the CIO and her business counterpart should have the power to agree on the strategic project priorities.
* Once the strategic prioritisation forum is constituted, start the discussion at the business strategy level, then work your way down to a high level project base. High level cross-project impacts and dependencies should be identified, and once this is done, it is fairly straightforward for the business to guide the priority decisions required.
* Communicate, communicate and communicate - the priorities and the rationale - to all functions and levels of the business and maintain transparency throughout the process so people are kept up-to-date on progress. A common understanding of the priorities is the key to the “invisible hand”, which increases effectiveness of IT delivery in the organisation.
A final point worth mentioning is the need to accommodate the business need for agility in IT delivery. Business strategy needs to respond far more actively, as changes in market and operating conditions take on new meaning in the current and potential economic climate and businesses are forced to react quickly to a change in direction.
Agile methodologies such as Scrum have matured immensely, and I would encourage organisations to consider the implementation of these methodologies in conjunction with the strategic project prioritisation process, in order to maximise the ability to respond to these changes in a more dynamic and effective manner.
Share