Does IT need a strategy?
In our strategy-focused world, this question almost seems irrelevant. Most of us would agree that strategy development is important for an organization.
In many cases, the content and development of such a strategy is unclear. Strategic planning is better understood in the business context than within IT. IT projects and initiatives are most often selected based on business priority and budget allocations rather than a developed strategic plan. The assumption is made that whatever business declares as a strategic project must also be strategic for IT. This implicit assumption positions IT as a business order taker but not as a critical strategic entity that contributes significantly both to business success and competitive advantage
An additional problem is that IT management frequently also perceives themselves as being order takers to the business rather than an equal partner that can help shape the whole corporation.
One of the reasons for this perception is that IT organizations are technology-focused and try to map technology to business requirements. The effects of such a viewpoint are that business requirements are not understood, technology is selected that does not match business requirements, and the business community becomes disillusioned with what IT is delivering. IT is trying to bridge the delivery gap by adopting new delivery methodologies, being more agile, and introducing new technologies with the hope that eventually a silver bullet will be found that will solve all these problems.
However, the answer does not lie in methods and technology but in the understanding of what the critical value chain is for the business. The understanding of Porter’s (1998) value chain and creating a competitive advantage must be integrated into IT. IT management must understand what the core business processes are. Once these processes are clearly understood as being the differentiator for the corporation, all activities and initiatives within IT should focus on ensuring that technological solutions are consistently improved and enhanced. All other processes are supportive processes and, while important, only assist the core processes. By applying Porter’s value chain to IT’s methodologies, priorities for ongoing initiatives can be much better defined.
The development of an IT strategy therefore requires an understanding of the core processes of the value chain. IT is therefore mandated to find ways to improve these processes to expand the competitive advantage. This is what IT strategy is all about.