Step 1: Assess Current IT Capabilities
A capability is an umbrella term that describes how an organization performs an activity. A capability is a combination of people, processes and technology. The first task in developing an IT Organization Direction is to identify weaknesses and gaps in current capabilities, particularly testing for how ready the organization is to support the strategic objectives of the company. The health of current technical components and their ability to support the business as it changes strategically is the critical element of mapping a strategic direction.
Info-Tech Tip: This step should be done considering your directions for both applications and infrastructure. These strategies may indicate future skill and experience levels that are missing today. But don't just consider your technical skills and processes. Companies periodically re-evaluate or re-state their corporate vision, mission and values. Also, evaluate the skill your organization has in dealing with the business. Assess whether processes or skills need to change to embrace how IT fits within the corporate operating model.
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1.1 Assess IT Capabilities
Periodically, every organization needs to assess whether the skills and know-how it possesses today will meet the needs of tomorrow. Based on business priorities and technical implications, the IT organization may need new or different skills, more people with particular knowledge, or different tools to support a new environment. Build an inventory of the skills and experience of your organization today. Meet with representatives from the business to understand their impressions of how the organization is perceived by your stakeholders.
Larger enterprises with multiple IT organizations or "shadow" IT groups (staff who are doing IT-related activities but do not report into the IT organization) should consider using Info-Tech's advanced tool, "Irregular IT Staff Inventory."
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Step 2: Scan for Potentially Enabling Technologies
An organizational structure is more than just reporting lines or workgroups. The organization must be designed so that resources can be marshaled and deployed to best meet business expectations.
The next task in developing an IT Organization Direction is to understand how well the current structure of the IT organization is positioned to support how the company expects to operate in the future. Determine whether structural changes are needed to improve communications, interaction with the business, and service levels. Assess whether changes in application or technology directions will require changes to the organization.
Info-Tech Tip: This step should be done with consideration of your direction for applications and technology. These strategies may suggest changes required to IT organization structure.
Info-Tech Tip: When a corporation reorganizes, take the opportunity to reassess the structure of your IT organization. Consider the following questions:
- Are key decisions made centrally, at a corporate level, or by each business unit?
- Who are the key decision makers in the corporation? How should the IT organization interact with each of these business leaders?
- Where is there confusion about how the business and IT organizations communicate back and forth? How might the organization structure change to streamline points of contact to eliminate confusion?
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2.1 Assess IT Organizational Alignment
Compare the structure of the IT organization with the structure of the corporation. Misalignment can occur when the corporation has adopted one type or organizing model while the IT organization adopts another. For example, some organizations are structured into autonomous divisions or business units where each business unit sets its own direction, and makes its own decisions with limited corporate interference. However, IT resources and services are often centralized and consolidated to gain economies of scale. Conflict will be inevitable as the central IT group is faced with competing demands for resources and priorities.
Assess whether your organization structure is interfering or enabling IT's ability to support business priorities. First, use Info-Tech's "IT Service Model Alignment" tool. Where the touch-points between the business and the IT organization are unclear or complex, consider using Info-Tech's advanced tool, "IT - Business Interaction Model," to document the various ways the business and IT organizations interact.
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- Structurally Fit: IT/Business Organization Alignment
- Develop a Process for Managing IT Service Delivery
- Internal SLAs: Business Expectations Must Match IT Resources
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Step 3: Develop IT Organization Strategic Directions
Once you identify where alignment issues, organizational holes, or interaction confusion exist, you need to set the course for changing the structure of the organization.
Info-Tech Tip: Discuss opportunities with business executives with whom you have trusted relationships. Often they can help evaluate whether ideas for change are likely to have the intended result.
Info-Tech Tip: Involve your Human Resources Department early in your organizational direction-setting. It will be able to provide assistance with job descriptions, compensation implications, and change management procedures.
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3.1 Identify IT Organizational Gaps
An organizational gap can be a weakness or hole in the way IT interacts with the business or in terms of how IT resources have been organized internally. Use Info-Tech's "IT Organizational Gaps" tool to help document points of concern with your organization structure.
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3.2 Set IT Organization Direction
At this stage in development of your IT strategy, organization direction typically involves describing how the organization needs to change in order to address the gaps and concerns raised during the assessment. Use Info-Tech's "Statements of Organization and Capability Direction" as a guide to documenting directions for your organization.
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3.3 Identify IT Organization Improvement Opportunities
Once you have identified the changes needed to support company objectives, begin to describe how these changes will happen. Consider:
- Skill development initiatives.
- Hiring initiatives.
- Arrangements with third parties.
- Improvements to processes and tools.
- Changes to reporting relationships.
- New roles and responsibilities.
Document the changes required and what the expected impact or benefit of these changes will have on the company, particularly with regards to enabling corporate direction. Use Info-Tech's "Organization and Capability Improvement Opportunity Template" for this activity. Once completed, these opportunity descriptions will be key to weighing all the options and investments during the IT Strategic Investment and Value Roadmap stage of the IT Strategy.
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- Eight Downfalls of Organizational Change Efforts
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IT Staffing Worksheet
Statement of Organization and Capability Direction
