Aligning information supply and demand

Reposted, original on the “IT Governance, the Kapteyn’s view” blog on Computerworld UK in April 2010

Business - IT alignment, when you read the articles written on the subject it turns out most of the time they focus on alignment between business and IT on a strategic level. But alignment between the two on tactical and operational level is just as important. So how about the Information Supply and demand relationship?

For some reason when we talk about IT we all seem to focus on the T of technology instead of the I of information. But at the end of the day what the IT-domain delivers to the business is information. One of my business customers translated it real nice (though very blunt): “Don’t talk about your technology-gizmo’s those are your (IT department) toys. For me to run my business I need you to deliver the agreed information according to the required specifications”. So Information not technology is of interest to this business executive. When we look at the quote a bit further we see the business (executive) demands information and wants the IT-domain to supply it (according to specifications). So there you go: The Information Supply and Demand relationship.

The first thing to realize is that the demand side of this relationship is not situated in the IT-domain but in the business domain. Here we find the first challenge. In the earlier posting on the Blog called “Business-IT alignment, a bad term (part one)” I already wrote “I have never seen an organizational chart were there was one organizational entity marked ‘business’ as opposed to an entity called ‘IT’.” Basically: THE business does not exist, in most organizations it is a complex set of departments with different information needs from each department. The article concludes the time of the one size fits all IT-approach is over for most organizations. The IT-domain should start looking at its core product (information services) with a marketing approach: What is the market? What are the market segments? Who wants what product (in this case information)? What are the required specifications for the product (think in terms of confidentiality, integrity, availability, etc.)?

If you made it this far reading this article and are still interested I would like you to think a moment about the current status in your organization. Are you confident that the demand side of clearly segmented? The information needs are identified per segment? Are the requirements for each Information type clearly defined? If you can confidently answer with yes, congratulations you are among the happy few! If the answer is no it is important to realize alignment goes both ways: If there is misalignment it might just as well be that the demand side of the Information relationship is chaos. Before a business manager starts complaining that “the IT department does not understand his needs” he might take a moment to see if he himself understands his needs and has clearly articulated them.

If you find the status of your IT-demand organization has room for improvement were should you start to improve the situation? Well the first step would be to identify the information-market segments. As most organizational models and experts will tell you information is one of the core production resources. Operational production is organized (formally or informally) in business processes. So if you want to know your (segmented) information requirements start looking at the business processes. For each of the steps of these processes you should be able to identify what information is needed to efficiently complete the step and what the secondary requirements for that information are (in terms of confidentiality, integrity and availability). When the basic structure for your information demand is clear you could think about building an Information demand organization. This helps to ensure a more structured approach towards information demand both on an operational, tactical and a strategic level. If you want to know how such an organization could be created, have a look at the BiSL model. Available from the ASL BiSL foundation, this is one of the few models that I am aware of focused on the information demand organization. The fact that the BiSL is in the public domain makes it easy to use it as a starting point.

All this on the IT Governance Blog, what is the connection? First of all some definitions (as I use them) to ensure common language, I have learned use of different definitions is the most common source of misunderstanding. The IT Domain is the organizational entity responsible for the Information supply side of the relationship. It includes the internal IT Department and any third-party suppliers involved in the creation of the Information Services. This is basically the complete IT supply chain. Information (demand) management is the management on the demand side of the relationship. As such it is very closely related, if not part of, the business (processes). There is confusion on this topic in real life; I also see definitions were Information Management is accountable for the complete Information supply and demand relationship, not just the demand side. Though this might seem as a slight (semantic) difference it is important for the mandate of the Information Manager: Does he just have authority for the business (supply) side of the relationship or is he also in charge of the IT (supply) domain? I hope you appreciate that makes for a substantial difference. As long as everybody agrees on one or the other in your organization both can work depending on your organizational structure.

I am a member of the ISO JTC1 WG6 Committee which is responsible for the maintenance and the continued development of the ISO 38500 standard on corporate governance of IT. One of the discussions I have with other committee members is about the scope of this standard: What does the standard govern? Though I personally find the statement could be articulated clearer, the consensus in the committee is that the standard concerns itself with the Governance of the Information Supply and Demand Relationship. So both sides supply AND demand, not just the IT Domain but Information (demand) management as well. Since (as we noticed earlier) most of the time information demand management is organized in the business domain this immediately goes to show that IT Governance is not just for the IT domain but business executives should be involved as well. But then again I am not the only one that is trying to get that message across. To reduce the confusion it might be better to start talking about Information Governance (or corporate governance of Information). But then again I guess that would just add to the confusion instead of reducing it, so better not introduce a new term.

This brings me to the next observation, within the C-suite the logical primary contact for issues concerning IT governance is the Chief Information Officer (CIO) this makes him responsible for the complete information supply and demand relationship, not just the IT Domain. So the role of CIO is not equal to the role of head of IT even though both roles are often combined in one function. When you look at the mandate of many CIO’s these days you will find that they are actually head of the IT department, not CIO (according to this definition). But what’s in a name? One last observation, do you ever look at publications (print, internet or otherwise) directed at CIO’s? Have ever noticed how 90% of the content of these publications is basically about Technology and almost none of it is focused on Information? Talk about misalignment, I guess information is just not “sexy” enough!