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Information technology
is more than a cost benefit and support function.
It is an enabler of good business. Every enterprise
needs an IT strategy, which recognizes and complements
the interests of the organization.
A few years ago, information technology (IT) was
perceived as a mere cost center and support function.
Today, IT is a value enhancer for business enterprise
and a key differentiator of service levels. Boardroom
decisions now rely on technology for the successful
implementation of business plans, and strategic
restructuring of organizations.
In order to provide a formal structure to the
IT function, it is imperative that organizations
develop an IT strategy. A formal IT strategy defines
the vision and objectives of the IT function and
also streamlines it within a well-defined scheme
of operations. Most importantly, it builds in
the well-deserved recognition for IT as an important
and integral function of the organization.
The need for business -IT strategic alignment
Even while organizations increasingly devote significant
time and effort to develop their IT strategies,
it is important that these are built in alignment
with the overall business strategy. Unfortunately,
this is not the case in a majority of the IT strategies
that get formulated. For example, about two-thirds
of the IT strategies developed in the retail industry
are reportedly not in complete alignment with that
of the corresponding business strategies (Source:
CGEY Retail IT Research Report 2002). Even while
the above statistics have been observed in the US,
it could measure even more in the context of organizations
in developing economies.
The implications of a lack of alignment are not
too hard to see. High levels of opportunity losses,
misplaced and redundant investments, operational
inefficiencies and customer dissatisfaction are
the common consequences of non-alignment of the
IT-business strategy. For instance, should the business
strategy demand a centralized operational model
for the organization, the IT architecture cannot
have a decentralized set-up, even if better technological
and operational efficiencies suggest such a model.
Technology for the sake of technology and not driven
by business needs only results in opportunity losses
and unnecessary expenses.
With the cost of non-alignment becoming dearer and
organizations also recognizing technology as a value
driver, the need to align the IT strategy with business
strategy has become significant. And this alignment
comes with its own benefits. As it can be observed
in Figure-1, institutions that move from a low alignment
to a higher alignment are characterized by higher
maturity in structural and process-oriented practices.
This is reflected in the strategic planning, organizational
reporting, day-to-day operations and successful
implementations of strategic initiatives of such
organizations. While technology brings about efficiencies
in operations, aligning it with business also enables
this adaptation to be much more effective.
A growing number of leading organizations are consciously
building strategic synergies between their business
and IT strategies, and this mutually symbiotic relationship
provides two critical advantages to such organizations.
Adaptability to Change
A well-aligned business and IT strategy facilitates
better anticipation and higher levels of preparedness
for technology-driven market changes, and gears
organizations to capitalize on technological advances
faster than their competitors. Furthermore, since
business drivers are themselves propelled through
technology in certain instances, this change becomes
much easier to adapt to. For instance, a bank that
has well-defined application architecture aligned
with its business strategy and with the adaptability
to plug in new applications, would have a big competitive
edge to launch new products and innovative offerings
over another bank, which does not have the same.
Structural Alignment
When IT strategy is in alignment with the
business goals, IT initiatives that flow from the
strategy also inherit such an alignment. The role
of IT function then becomes that of a facilitator,
while the ownership of IT environment is shifted
towards business units, resulting in better structural
alignment of IT and non-IT functions. With IT projects
increasingly growing in size and value, it is but
imperative that such an ownership of IT initiatives
by business users is encouraged. This ensures success
of large IT initiatives which have a direct bearing
on the business strategy of today's leading organizations.
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We believe in continuously enhancing
our strategic intent through the D-cube model
Direction–Discovery–Destiny |
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We believe that for getting success,
you require right Direction. |
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Discovering innovative solutions. |
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After getting right direction and After discovering
innovative solution. |
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leave upon the Destiny. |
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