Contributed by Matt Ipri
Many years ago, He-Man coined the phrase “I HAVE THE POWER!” Kids like me ate it up in spades. How could we not?! I wanted The Power! I wanted a sword that I could raise in the air and change from my sheepish little self into the “all-powerful” He-Man! And, of course, I wanted to be able to change my little cat – aptly named “Tiny” – from his smug little self into the almighty Battlecat! It was the dream!
And, what’s nothing sort of amazing, is that dream continues for so many today…From our current government environment, where new sources of “power” are being flexed daily, to every organization across the country, trying to actually grab “the power” remains a constant, but important, struggle. And one of the most INTERESTING places where this struggle plays out is in IT organizations at large commercial entities. Nowhere else is there more consternation, in-fighting, and disagreement than about who has the final control over IT investments and resources.
So, where does “the power” lie when it comes to making strategic IT decisions?
This is a question we help organizations ask and answer every day. It seems like a pretty innocuous question on the surface, doesn’t it? Clearly IT decision making power lies with the IT executive branch – the CIO, CTO, VPs – right? Well, interestingly, the question isn’t that simple when the realities of portfolio planning, sources of funding and competing priorities set in.
Unfortunately, the notion that “the executive team makes the decisions” in most enterprise IT organizations is not a reality. And in so many cases, that’s because it comes down to the funding. The way the funding of IT is set up is incredibly influential on how the strategy of the organization is defined and how the big investment decisions are made. Is IT a self-funded organization, given a budget to serve all initiatives across the business? Or is IT more of a “project-funded” organization, given funding on an initiative-by-initiative basis from business units or profit centers? That question, more than any other, often defines where “the power” lives and how the prioritization decisions are made.
How do you plan strategically when the IT organization isn’t funded as a whole?
When the IT organization is funded directly as a whole, “the power” tends to lie with the IT execs, and they get to make most of the decisions about what they do and how. But, when an IT organization is funded at the project level by outside business units or profit centers, “the power” lies with the outside groups. IT is often left powerless, forced to deliver on the requests of those groups since “they’re the ones paying for it”. This can create a real EFFICIENCY problem for many groups, especially large ones. Because it becomes quite easy to start delivering “less than strategic”, redundant or just unnecessary initiatives when IT isn’t empowered to look ACROSS the portfolio to make smart decisions.
The smartest IT executives find a way to thrive in these environments by putting the governance processes in place to review and prioritize requests, even when they are funded by outside groups. They do it by enlisting the support of executives across the company AND by showing the data of resource inefficiency and potential gains. By having clear data on how initiatives deliver against corporate strategy and how much “value” a project can actually deliver, IT leaders can arm themselves with what they need to get the profit centers thinking about the BEST ways to spend their IT dollars, even when they control it.
Equip your business unit or profit centers with data and potential value
IT leaders won’t always have the “nirvana” of controlling their own budget, neatly making all the project decisions across the company. THAT’S the reality. But they can equip themselves with the data and visibility necessary to still have the same decisions made as if they did. THAT’S how THEY get “the power”. That’s how THEY live their childhood dream of being He-Man. (Even if they still can’t get little “Tiny” to turn into “Battlecat”.)