Alignment Between Business and it

¶ … alignment between business and it strategies? And why such alignment is so important? Compared to other governance models (e.g. For marketing, finance, etc.) why the it governance has not received appropriate attention yet? Integration between business models is important in that it allows both the strategic and tactical vision of the company to occur. Organizational management expects it to be an investment in an improvement of actual deliverables to stakeholders both internal and external, and therefore a value added department as opposed to a cost department. Non-alignment of these two goals often results in disparity and inefficiency, which in turn drains fiscal resources. It governance still has a credibility gap compared with marketing, finance, and human resources because it is a newer field, in some areas unproven, and in other ways a unit that must spend a great deal of fiscal resources before proving its value to the organization.

What is the it management's role in an it steering committee? It usually takes the role of helping to guide the organization in the technical means to accomplish goals. An it steering committee must be quite strategic, since their role is to utilize given information to provide potential technological solutions based on the needs of the business at X future date. Dependence on strategic planning on budgets guide the number of months out on strategic equipment and software planning.

3. What governance mechanisms are most commonly employed in managing it vendor relationships (it vendors vend HW, SW, and/or it services). Typically partnership/Alliance -- allowing access to new resources; process teams -- usually tied to budgetary cycles; shared risk teams -- strong partnership of organizational departments with shared needs; steering committees that tend to look at long-term directions or day-to-day decisions; and value measurements assessments based on processes or organizational structures.

4. Describe the decision-making process when considering outsourcing arrangements. A strong organizational center is necessary when organizations look to outsource. Prior to any modelling of outsourcing, the first step is to examine the critical value-chain links within the organization and between it and business operations. Since it systems link key business processes (finance, HR, and marketing) it is only prudent to keep those in-house so the interfaces between functional departments are tightly controlled and integrated. to, since value-chain analysis requires that interfaces are linked between business processes in a robust manner, the it department should have a strong vote about whatever decision or application is outsources. Once that is agreed upon and formulated, there are then four major processes when considering outsourcing: measurement, research/identification, construction of the arrangement, and follow up:

Measurement -- What is the organizational setting? How will the relationship between vendors be measured? What benefits does the organization expect? What scorecard method is used to define and hone the process?

Research/Identification -- What core competencies does the vendor possess? Assess the risks for outsourcing a particular product or service, especially in line with stakeholders and competitors. Place less importance on quality of service as a constraint, most marketplace decisions are outside this issue.

Arrangement -- is this long-term or short-term? Why? Outsourcing is a relationship, not just a contract.

Follow up -- What mutual measurements will be made to ensure a win-win scenario? What visions for the future (especially in it) are strategically aligned for both organizations? (Khosrow-Pour, 2006, 131).

5. Describe remedies for poor performance that might be included in an outsourcing arrangement. Sometimes, performance is neglected when outsourcing and used as an excuse rather than a business opportunity. Upfront standards of expectations and measurement of those expectations is essential within any outsourcing relationship -- this is done by establishing clear, concise, and measurable performance standards and metrics. Performance standards should be equal to or better than what is being provided prior to outsourcing. Contractual arrangements and regular benchmarks to measure this performance are essential, with a written guideline of the penalties for non-performance or lack of established performance goals. The most typical remedies for poor outsourcing performance are fiscal. This might be reflected in warranties under specific guidelines and obligations within the initial contract. For instance: