{"id":9724,"date":"2011-09-08T00:14:00","date_gmt":"2011-09-08T00:14:00","guid":{"rendered":"https:\/\/lei.flywheelsites.com\/?p=9724"},"modified":"2021-01-11T00:22:35","modified_gmt":"2021-01-11T00:22:35","slug":"lean-business-it-integration-part-one-who-wants-to-go-talk-to-it-about-this-one","status":"publish","type":"post","link":"https:\/\/www.lean.org\/the-lean-post\/articles\/lean-business-it-integration-part-one-who-wants-to-go-talk-to-it-about-this-one\/","title":{"rendered":"Lean Business-IT Integration, Part One: Who Wants to Go Talk to IT About This One?"},"content":{"rendered":"\n

In this, the first of a five part series, LEI faculty member Steve Bell begins with the importance of lean business-IT integration. Part Two offers help with the common obstacles to a lean IT transformation. Part Three examines how to integrate the various IT communities. Part Four addresses the management and governance of this new approach. And Part Five explains how to measure business-IT value<\/a>.<\/em><\/p>\n\n\n\n

Bell is the author of<\/em> Lean Enterprise Systems: Using IT for Continuous Improvement<\/a> (Wiley, 2006) and co-author of<\/em> Lean IT: Enabling and Sustaining Your Lean Transformation<\/a> (Productivity Press, 2010) which received the 2011 Shingo Prize for Research and Professional Publication. He is the founder of Lean IT Strategies, a lean leadership coaching<\/a> firm.<\/em><\/p>\n\n\n\n

Lean Business-IT Integration, Part One: Who Wants to Go Talk to IT About This<\/em> One?<\/strong><\/p>\n\n\n\n

One of the many challenges of an enterprise transformation is the tension between the continuous improvement of business processes and the lack of agility of supporting information systems. As kaizen teams overcome one problem after another, they often hit exasperating technology roadblocks. Each time the team stops, bewildered, looking to each other asking, \u201cWho wants to go talk to IT about this <\/em>one?\u201d<\/p>\n\n\n\n

Today, nearly every business process relies on quality information and effective information systems. And many, if not most products and services they deliver have a technology component which cannot be separated from the customer\u2019s value proposition. Yet in most enterprises\u2014even those that are aligned along value streams\u2014IT specialists remain functionally organized, and in some cases, not even housed in the same physical location as their business counterparts.<\/p>\n\n\n\n

In survey after survey, the majority of businesspeople report that IT does not understand their business, and does not deliver value. But in today\u2019s technology enabled marketplace, IT must<\/em> deliver value; the enterprise must<\/em> leverage the extensive capabilities that software and internet technologies offer if it is to successfully compete. And IT organizations must continuously improve, investing in operational excellence, reducing costs and overhead burden, in order to dedicate more investment and energy towards growth, innovation, and transformation.<\/p>\n\n\n\n

IT\u2019s Misguided Mission<\/strong><\/p>\n\n\n\n

This is not a sad story of IT failure, but a hopeful one of IT potential. In fact, the MIT Sloan Center for Information Systems Research reports that \u201cthose companies that have effectively digitized their core processes have higher profitability, experience faster time to market, and get more value from their IT investments \u2013 yet have 25% lower<\/em> IT costs.\u201d[1]<\/sup><\/a><\/p>\n\n\n\n

For decades, IT has been on a mission to \u201calign with the business,\u201d and to \u201cdeliver value to the business.\u201d That mission is now over. In fact, it was misguided from the very start. IT and the business are one. Period.  \u201cAlignment\u201d entails bringing distinct entities or objects into a line. In this view, IT and other departments within the enterprise are viewed as separate. To achieve and leverage full value-stream orientation, what we seek is not alignment, but integration<\/em>, where IT is a part of<\/em>\u2014not separate from the business value streams.<\/p>\n\n\n\n

To achieve and leverage full value-stream orientation, what we seek is not alignment, but integration<\/em>, where IT is a part of<\/em>\u2014not separate from the business value streams.<\/p><\/blockquote>\n\n\n\n

From this perspective we must also recognize that IT is not homogenous. In fact, there are many IT communities that tend to see themselves as separate specialized disciplines: application development and maintenance, IT services such as infrastructure and operations (which often includes outsourced service providers), enterprise architecture, business process management, ERP and other packaged application management, data and integration management, security, and business intelligence, to name a few. So as we seek to integrate IT into the business value streams, we must also address how these distinct and sometimes competing communities complement and align with each other.<\/p>\n\n\n\n

What Is the Problem?<\/strong><\/p>\n\n\n\n

In this five part series, we\u2019ll explore a leadership framework for shifting from alignment<\/em> to lean business-IT integration<\/em>. Part One (which you\u2019re reading now) introduces the importance of lean business-IT integration. Part Two will discuss common obstacles encountered during an IT transformation. Part Three will discuss integrating the various IT communities together within enterprise value streams. Part Four will address the management and governance of this new approach. And Part Five will examine how to measure business-IT value, in order to sustain a culture of accountability and value stream performance.  <\/p>\n\n\n\n

So to begin, let\u2019s explore how an enterprise often stumbles with integration of the IT function into the business.<\/p>\n\n\n\n

Consider the role of IT specialists in value-stream improvement. Kaizen teams are usually comprised of members representing each step in the flow of value — but quite often, IT is not represented. If the team is unaware of the technology complexities hidden from view, how can they make well-informed technology improvement decisions? In many cases, the team approaches IT with a \u201csolution\u201d (the classic \u201ctoss the request over the wall to IT\u201d) without really understanding the problem. In this way, misguided continuous improvement efforts add more layers of scar tissue to an overly-complex system, requiring even more IT effort just to keep it running.<\/p>\n\n\n\n

Also, without awareness of emerging IT capabilities, how can a kaizen team consider potential value enhancing features? Enlightened business-IT teams bring a fresh perspective on how to drive innovation and create value\u2014new ways for the customer to communicate to the enterprise what they want, new ways for the customer to engage in self-service, new ways for the enterprise to deliver what the customer values faster, with better quality, and at a lower cost, creating real competitive advantage.  <\/p>\n\n\n\n

How big an advantage can this be, you ask? Consider many internet-based enterprises that have achieved true business-IT integration\u2014 Amazon, Google, eBay, Expedia, Netflix, Skype, and many others. By incorporating technology enabled products and services into their fundamental customer value propositions, they have disrupted their respective industries. But this strategy isn\u2019t limited to the new companies alone, many traditional enterprises such as CapitalOne, Dell, General Electric, and Southwest Airlines (to name just a few) have also made this shift.  <\/p>\n\n\n\n

The future is bright for innovation; with all its inherent challenges, skillful application of IT enabled products and services is vital to the modern enterprise. And the adoption of these principles: respect for people, quality at the source, voice of the customer, flow of value, and others, help to create an agile, adaptive, learning organization.<\/p>\n\n\n\n

In Part Two, appearing next month, we\u2019ll explore common obstacles encountered during an IT transformation, and strategies to overcome them.<\/p>\n\n\n\n

Links to articles in this series<\/strong><\/p>\n\n\n\n