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Tue, Jan 15, 2008 5:24 EST

IT Strategy 3.0

Topic: Enterprise Management

Blog: CIO Knowledge Space

Current Rating: 5 Comments: 3

Corporate strategies for IT are entering their third and potentially final generation.  An upcoming conference, entitled "IT Strategy 3.0 - Staying Ahead", is dedicated to exploring the collaborative and convergent future that these strategies are now both creating and exploiting.

It's going to be my privilege to deliver the opening keynote, "IT Strategy is Dead. Now What?", at the April 2008 IT Strategy 3.0 conference in Sydney, Australia.  The conference organizers - BTELL - have assembled IT leaders from private enterprise and government across Australia and New Zealand, as well as some globe-trotting specialists like me.  We're there to explore the practical and commercial implications of the latest seismic shifts in the way organisations formulate and execute their corporate strategies for IT.

Even the choice of title is thought-provoking.   While much of the world seems to be on 'anything 2.0' (except for Bruce Willis), strategies for IT are already on 3.0 so that they can pull the latest developments in the best strategic direction.

So if we're on IT Strategy 3.0, what were 1.0 and 2.0?  Here's my take.

The first generation of IT Strategies focused on technologies and the people who delivered them.  At its heart were technology roadmaps, IT organisation models and IT outsourcing.  The operating model was founded on company-wide control of the IT agenda. 

The next generation, 2.0, is characterised by those organisations who responded to the increasing obsolescence of IT Strategy 1.0 by deciding to have no formal corporate-level strategy for IT.   They replaced the old control-based operating model with one centred on IT service management and the ‘alignment' of IT with the rest of the business, so recognising business leaders' accountabilities for investment decisions and the creation of value from IT.    

Alongside the benefits of IT Strategy 2.0, its downside has been the growing diversity of informal - or 'de-facto' - business-led mini-strategies for IT, further fuelled by developments such as Web 2.0 and with no overall strategy to steer them.  And in the absence of anything formal, the corporate-level de-facto strategy for IT has been executives' determination to constrain IT costs, usually with limited understanding of what connects these costs with the creation of value, or indeed what causes IT costs in the first place.  To make matters worse, in some cases the unfortunate kneejerk reaction to this 'strategy' has been to defend or justify the IT costs, rather than encourage everyone to explore what causes them and what value people create from them.

As you would expect, IT Strategy 3.0 samples the best elements of its predecessors and learns the lessons of their shortcomings.  It places these in an overall strategic context where the people that invest in and use technology know best how to create value from it; where convergence (not alignment) is the basic operating model;  where the true value of constraining IT costs is understood and carefully applied; and collaboration is the main engine of success.

As the focus of value creation in the world of IT is shifting from producers to consumers, the third generation of strategies for IT is already there, pulling everyone in the most promising direction.  And as convergence and collaboration demolish the old IT Strategy 1.0 and 2.0 boundaries between 'IT' and 'the business', the third generation strategies for IT may well be the last ones we'll ever see.  Organisations will be systemically making the best technology-related decisions at both micro and macro levels, while CIOs and their teams will have moved on up to greater things

Should be a great conference.  Get there if you can! 

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Average (2 votes)
5
 
 
Sun, Jan 20, 2008 6:55 EST
Anonymous user
Posted by: SSam
Rating: 70

I am a junior analyst and was planning to join the IT strategy group shortly....The title of this article caught my attention .. at the end of it i stand confused..... is IT strategy Really dead or soon going to be ? will organizations stop formulating IT strategies or will it be done under a bigger effort( Strategy as applied to the Enterprise )... so will i choose a road with dead end ? .... Advice anyone ....

 
Mon, Jan 21, 2008 12:53 EST
Anonymous user
Posted by: Jerry Gray
Rating: 90

Not to worry SSam. Declaring something "dead" is a standard play in the "grab headlines" strategy guide. This play was most effectively used by Madonna over the course of a very successful music career, and perhaps in IT circles, mostly famously employed by Nick Carr, the "Madonna" of IT strategy when declaring IT as a whole was dead. Further, stating something is "x.0" is an attempt to remain fully buzzword compliant. Stay tuned for further posts across the web for Internet 3.0, Business 3.0 etc. You will know when this version has become worn out when you begin to see Internet 4.0, Business 4.0 blah blah blah.

Outside the standard headline play and attempt at being buzzword compliant, Mr. Potts is generally correct in the evolution of IT strategy. As a junior analyst what is probably more important to you today is determine what the high-level generic strategy of your organization is, (Defender, Prospector, Analyzer), and determine if you IT organization has a governance model that best aligns with the high-level strategy. Your peers in your organization could probably best brief you on the state of your organization and the maturity of its strategy making process.

Strategy development and execution is a complex topic; one that is not generically addressed in a 500 word blog posting.

 
Mon, Jan 21, 2008 19:10 EST
Anonymous user
Posted by: Walter Adamson
Rating: 90

Well said Jerry, and thanks Chris for the catchy title and bringing my attention to the upcoming conference in my own backyard.

Strategy always evolves but having the correct framework for business priorities and decisions never goes away, it just gets buried in technology and waves of revenge and buck-passing as different genres of business people try their hand at taking over the business of creating value through IT.

In my opinion nothing beats a great IT professional with a great business brain but of course without the ability to be part of the team or have the confidence of the C-team and the influence at the top then other amateurs will always dabble and almost always with limited success. Outsourcing history shows us that most clearly, with CFOs moving in to create a mess and then CIOs moving back into power in the wake of the mess yet unfortunately moving outsourcing to a technical buzz rather than a business solution.

There can be no substitute for alignment through clarity of vision, consistency of execution, and mutual commitment, and that is becoming a very complex task between IT and business which requires very competent strategy, planning and execution skills. It's not going away - its becoming more challenging in every dimension and more interesting.

The good CIOs are in command, and the other 95% say that things are moving too fast for strategy or something equally lame and so they continue to invest in the wrong things! Get with it and bring on Strategy 3.0 if it helps get people involved and creates value for business!

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