"IT must align with business." This statement has for a long time been a popular point of debate among analysts, consultants, business people and IT professionals. More recently, advice has been freely offered (usually by observers) as to the new and changing role of the CIO.
As is often the case, this "change" is largely viewed as a threat by IT professionals who fear that it represents a fundamental challenge to their established practices, and perhaps sends ripples through not so firmly entrenched IT fortresses in the corporate landscape. Perhaps it is time that IT people stop whining about their lack of presence on the board, and do some soul-searching as to precisely why IT is still perceived in many manufacturing companies to "not matter" or not to be a strategic enabler of business success.
Much of the perceived role of IT in manufacturing has to do with the historical development of the formal IT profession, which evolved from financial systems, through MRP into ERP and beyond. There were enough challenges in these areas alone to build a successful career. It may be cynically argued that many careers are still being made (and destroyed) in simply getting basic ERP to work.
In parallel with the evolution of IT as a profession, other technical disciplines such as engineering were designing the actual manufacturing processes, and putting in place highly sophisticated systems for controlling these processes. These two disciplines eventually met in various ways as technology converged, and new standards for interoperability such as S95 emerged to define a conceptual framework for connecting manufacturing process with business processes. Connecting the plant floor with the boardroom is now technically feasible, and a number of IT organisations are aligning their offerings with this concept.
Much of the perceived role of IT in manufacturing has to do with the historical development of the formal IT profession.
Gavin Halse, MD, ApplyIT
But what does the future hold for IT professionals in manufacturing companies? Let us look at an analogy. I am reasonably sure that at some point in the past, with the introduction of telephones, the department operating the switchboard felt they were central to the whole business. After all, they could control all communications in and out of the organisation; they had some very clever and impressive looking and "advanced" technology.
I suppose that it was even feasible to connect the plant floor to the boardroom telephones by simply plugging the right cable in at the right time, but I suspect that this was not seen to hold much value in itself. I wonder how many switchboard operators felt they deserved a position on the board of their company? With time, as the switchboard service was overtaken by new PABX technology, I am sure there were some that felt "aligning the switchboard with the business" was the right approach to ensure their survival and of course protect their seat on the board.
Of course, the business was far ahead of these people, and the telephone rapidly became a (necessary) business commodity and the only real criteria for a successful telephone infrastructure were service levels and cost.
Business is about taking calculated risks to achieve commensurate returns. This is done by bringing innovative products to create customer value, within clearly defined resource constraints and governance processes. Quite simply, if you contribute to this value process really effectively you will soon find yourself occupying a seat on your board. Traditional IT has a poor track record in taking calculated risks to achieve business returns (see how conservative and ineffective many IT departments are when choosing and motivating solutions).
Like the switchboards of the past, some IT departments are becoming swamped by changing technology and now only have service levels and cost control as priorities.
The marrying of IT with business will happen with or without the IT department, as business entrepreneurs discover technology and apply this in their businesses. To embrace this change, IT professionals in manufacturing have to actively immerse themselves in understanding the detailed complexities of manufacturing processes itself and the manufacturing supply chain in particular. From this sound understanding, IT professionals have a unique overview position to lead business transformation by becoming "IT entrepreneurs", willing to look beyond cost control towards new ways of doing things or profitably making and selling more widgets.
When they do this successfully, "aligning IT with business" will become an obsolete concept. IT will disappear, leaving one integrated business entity. The traditionally defined CIO role will probably disappear, as did the "head of telephony services" a few decades ago. And the end of that particular debate will be a relief to everyone.
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