1. Info-Tech Research Group1 Decode the Real Corporate Strategy Understand the business goals that drive IT strategy and initiatives.

2. Info-Tech Research Group2 Almost 50% of IT leaders surveyed* are experiencing problems prioritizing IT initiatives & spending due to difficulties interpreting corporate strategy. Introduction Who don't understand corporate strategy well enough to inform the IT strategy. Who are in organizations undergoing change in the way they do business (e.g. new market direction, expansion or contraction due to mergers or acquisitions). Who cannot effectively demonstrate that the work the IT department is doing supports the achievement of business objectives. Identify the symptoms of IT shops that need a better understanding of their organization’s corporate strategy in order to build the IT strategy. Build a discovery process that ultimately enables the insertion of technology into the context of the business. Position you with the business information needed to build an IT strategy that supports the goals in the corporate strategy. This Research Is Designed for CIOs:This Research Will Help You: * N=142 Source: Info-Tech Research Group

3. Info-Tech Research Group3 Executive Summary The Finding Over half of IT resources in, 70% of organizations, are working on projects that are not linked to corporate goals*. IT and business strategies are not linked and funded IT initiatives are not helping to achieve corporate objectives. In times of economic uncertainty, it is vital to CIOs that every IT dollar be wisely invested or the CIO risks being replaced. In many organizations, the IT leader is not part of corporate strategic planning. CIOs find themselves in jeopardy more often for what they don’t know and aren’t doing than for the things they are doing. When the corporate strategy is available, it seldom provides the detailed business information needed to develop a sound IT strategy that enables corporate objectives. The result is misalignment between the business objectives and what IT actually delivers. The Solution Developing an IT strategy requires that CIOs devote time and energy to ask the right questions of the right people in order to understand business drivers, strategies and goals. Use advice in this research to: ◦ Create a consolidated view of the business organization, operation and customer directions. ◦ Confirm a common understanding between IT and the business. ◦ Begin the process of developing the IT strategy and plans. * N=142 Source: Info-Tech Research Group

4. Info-Tech Research Group4 What’s in this Section:Sections: Understanding corporate strategy is critical to business/IT alignment Understanding Business Strategy is Critical to Alignment Determine the Corporate Strategy Identify Business Goals and Themes Next Steps IT’s lack of understanding What success looks like How to get there Why this is difficult to do

5. Info-Tech Research Group5 “We should fire the IT team and give their budget to my team.” “The business needs to get its own house in order before it starts trying to fix ours.” “Not only was the new system late, it cost twice as much as they said it would, and it doesn’t do half the things we need it to.” “We wouldn’t have these problems if they [the business] knew what they were doing over there.” “We’ve given up waiting for IT; we’ll do it ourselves.” “What we need is well-documented business processes.” “IT just doesn’t get it.”“The business users kept changing their minds.” IT’s lack of understanding of corporate strategy leads to misdirected IT funding and decision-making From Business Leaders: …then you need a better understanding of the business strategy to become better aligned with the business. From IT Leaders: *Source: CIO Magazine, How to Fix Ailing IT-Client Relationships By Damian Smith To make your decisions, you need to know the objectives of the organization. If these are things you hear in your organization*…

6. Info-Tech Research Group6 High-level corporate strategies typically don’t contain the specific business objectives needed for IT strategic planning IT initiatives and services don’t support business needs or line up with organizational objectives and priorities. IT projects and deliverables cost more in time and money for rework to meet actual business needs Lack of understanding of management requirements results in a deficit of relevant data, business intelligence, etc. Relationships between business units and IT are strained or limited and business leaders are frustrated with IT’s inability to deliver the solutions needed to achieve business goals. CIOs, in the dark when it comes to corporate strategy, struggle when business goals and IT plans are misaligned CIOs partner with business leaders to develop corporate strategy. The corporate strategy drives IT goals and objectives, which, in turn, drive IT projects. Successful completion of IT initiatives that address specific business strategies influence how the business results are achieved. When corporate strategy is not understood: When corporate strategy is understood:

7. Info-Tech Research Group7 To fully align IT strategy with corporate strategy, CIOs must discover and understand the individual business strategies. Full comprehension is achieved by dissecting the corporate strategy into the individual business strategies Corporate Strategy: the high level strategy of the organization addressing the diversification of the markets/industries the company competes in. The corporate strategy answers the questions of "which businesses should we be in?" and "how does being in these businesses create synergy and/or add to the competitive advantage of the whole corporation?” * Business strategy: refers to the aggregated strategies of single business firm or a strategic business unit (SBU) in a diversified corporation. Business strategy answers “HOW does the firm compete in a single market or industry?” * Determination of specific the business-level customer, operational and organizational directions will roll up into the aggregate for the organization. Examination at the business-level is needed when the overall corporate strategy: ◦ is too high-level ◦ isn’t clear ◦ isn’t well documented Its not as easy as it sounds. Individual business units have their own goals that are not always perfectly reconciled in the corporate strategy. Or, the process for communicating their goals to IT is flawed. This makes the discovery process for IT even more difficult. Read on to find out how to overcome these challenges. Info-Tech Insight *Source: Why Does Firm Performance Differ? Scott Gallagher

8. Info-Tech Research Group8 IT leaders who align their IT strategies to a well understood corporate strategy show higher rates of success IT Alignment vs IT Success* N = 125, Source: info tech Research Group *See Appendix I for criteria for IT Success andAppendix I IT Alignment with Corporate Strategy IT leaders who lack full understanding of the business goals and objectives are not aligned with the business, and therefore, are not positioned to positively influence how the business achieves results. The CIO won’t be invited to participate in the corporate planning process. IT initiatives they undertake are less likely to be those that will best help the business achieve its strategic goals and objectives.

9. Info-Tech Research Group9 Understanding specific business goals ensures that IT solutions provide the expected business savings Situation Risk Action An online community does their taxes in a financial organization’s computing environment. The corporate objective was “reduce operating costs by 20%.” Short sighted cost cutting across the board in the online security environment would have exposed the private information of thousands of people to unauthorized access, damaging the reputation of the organization, and resulting in class action lawsuits totaling in the millions of dollars. The CIO worked with the CFO to determine the Finance Department strategy and directed IT’s cost cutting initiatives to those areas that would reduce costs and still preserve data integrity. BENEFIT The organization eliminated the financial risk of: o Litigation and settlements/fines in the millions. o Reputational damage that would negatively affect revenues from sales of the Web-based financial services. e.g.

10. Info-Tech Research Group10 Info-Tech Research Group Helps IT Professionals To: Sign up for free trial membership to get practical solutions for your IT challenges www.infotech.com Quickly get up to speed with new technologies Make the right technology purchasing decisions – fast Deliver critical IT projects, on time and within budget Manage business expectations Justify IT spending and prove the value of IT Train IT staff and effectively manage an IT department “Info-Tech helps me to be proactive instead of reactive – a cardinal rule in a stable and leading edge IT environment. - ARCS Commercial Mortgage Co., LP Toll Free: 1-888-670-8889