How to use business simulations to solve the business & IT alignment

Published on Friday 20 February 2015 by in News with no comments

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This was the title of a session I held at the annual Pink Elephant conference in Las Vegas. Two immediate questions that arose when I mentioned the title to people were: ‘Simulation?…a game!!…uh..yes.. interesting….how can THAT help?’ and ‘Business & IT alignment…is that still relevant?

In this blog I will not answer  these questions specifically, but will instead refer to some recent links and blogs that explain survey results into both subjects and some articles that describe why business & IT alignment is still very relevant.

Business simulations

ITSM review: A game is juts nice to have right? – Wrong!

Blog: Business simulations? 100% No brainer

Business & IT Alignment

Blog: Business & IT alignment (Groan) – shows latest top ABC (Attitude, Behavior, Culture) issues chosen from global workshops….same for last 10 years!!

Informationweek: CIO worries: Security, Talent and (sadly) Alignment (show results of latest SIM survey)

CFO.COM: The IT Talent problem

If you have taken the time to click and read on any of the above then I think you will agree both topics are highly relevant.

The Pink Elephant session

In this session we played 1 month of the business simulation game ‘Grab@Pizza’ to explore reasons Business & IT alignment is still an issue and to try and identify some success factors to take away.

In this game delegates play the business and IT roles in global Pizza franchise organization. Grab@Pizza is a very successful company selling millions of Pizza’s every year. But after 6 months into the current year, the sales figures are far below expectations. IT is posing a significant business risk due to downtime and the inability of IT to respond to changing business needs (Risk Optimization). The CEO urged the Business Managers to make a challenging recovery plan. This plan is based on a 6 month strategy to bring the sales and profit back on target (Benefit realization). Existing IT capabilities are poor, resources are tied up in ‘Keeping the lights on’ rather than supporting and enabling new innovations. The IT department must ensure the appropriate capabilities are in place to execute the strategic plan and sufficient, appropriate and effective resources are provided to ensure both benefits realization and risk mitigation( Resource optimization).To enable this delegates explore how best practices such as COBIT and ITL can be used to enable this turn around.

We played one month of the game. It was characterized by them-and-us between business & IT, It was too internally focused, processes and communication were not aligned, there was lack of understanding of business impact and priority. The business was not clearly shaping or quantifying their needs nor governing IT. After the game round we reflected ‘Why did this happen? Do we recognize this in reality?, and what could we do differently to prevent or solve this in our organizations?

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At the end of the session I asked each person, ‘What was your take away?  How did playing a GAME provide them with any new insights or value? These were the highlights:

  • The importance of investing in BRM (which was also a key success factor named by the project of the year at the conference).
  • The importance of ‘ Demand management’ and ‘ Service Portfolio management’ for helping both Business and IT get a better understanding of ‘Values, Outcomes, Costs, Risks’ – the dialogue will also ensure the business helps quantify real needs.
  • The importance of using the definition of a Service in terms of ITIL – VOCR (Values, Outcomes, Costs, Risks), all in IT should KNOW this, specifically in terms of their business. This explains the ‘Why’? of ITSM. Process managers such as problem manager, change manager must be able to make business cases based on this, Incident priority mechanisms should be aligned with this.
  • The need to engage with the business to agree VOCR. This will determine priorities, decision making and allocation of scarce resources. The business is often focused on new IT solutions to generate Value and Outcomes – IT must maintain stability, security, reliability and continuity to mitigate Risks associated with IT and the way that IT is managed and governed. Investment and resource decisions must be balanced across both areas.
  • Don’t make assumptions. Assumptions = Assumicide! Both IT and business make many assumptions about what the other party understands.
  • The need to ‘integrate’ processes. Despite many years using ITIL, processes are still not optimally aligned and integrated with each other – there is still a SILO’d approach.
  • Many businesses display the behavior in the game – they do not effectively engage and communicate and do not effectively govern IT. In these instances IT needs to be pro-active in helping the business. Instruments such as BRM and CoBIT can help.
  • Business and IT alignment isn’t a strategic thing. People at the Help desk should also understand business priority and impact so they are better able to prioritize.

The diagram below shows on the left, the focus areas of CoBIT relating to value creation, and on the right the description of a Service according to ITIL, showing how these are frameworks are supportive of each other.

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Does a simulation help? Is business & It alignment still a relevant topic?

Quote from one of the delegates: ‘ This session is powerful, it confronts people on their attitudes and behavior and can be used to get business and IT people on the same page, agreeing joint actions and strategies for ensuring a better alignment’.

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