Week 1: Strategy & Governance
There are 2 types of questions (What and How):
Strategy: knowing how to create a vision, how to change the
IT infrastructure to be future proof and ready for the new
generation. What do you want to be as an organization?
Governance: How are you able to achieve what you want to be? How do you organize things
to take care that you will achieve your strategy goals? In governance there are 3 focus areas
o Enterprise governance; on the ownership/board level. separation of ownership and
control of the organization. Below this level you have;
o Business governance; Direction and control of the business plan and strategy by the
CEO which is focusing on the overall responsibility of the business governance, and a
CFO which is focusing on the financial part
o IT governance; Direction, control, and execution of IT plans and strategies by the CIO
which is focusing on the IT governance
Different C-levels:
* Owner, CEO, people in charge; situated at the left top quadrant
* CFO (finance officer); situated a bit to the right, but at the top quadrant. Responsible for
finance, which is situated in an ERP-system, and therefore also responsible for the IT
* COO (operational officer); situated a bit to the right, but at the top quadrant
* CRO (risk officer); situated at the top right quadrant
* CIO (information officer); Combined function of knowing things about business, finance, and
information; background in business knowledge, business management, IT management,
quality of information. This function is often combined with the CFO because of logical
perspectives, however this is not the best to do so (it could work though)
* CTO (technology officer); technical person at C-level; rare feature. Positioned a level lower
than C-level, because he/she doesn’t fit on board level meetings.
o Nowadays combined with CIO, through the increase of cloud computing where the
technology environment is outsourced. But still there is information that comes out
of the systems. IT information can provide business leverage and be a driver
Big organizations have all the C-level types in their organization. They have the ideal situation of
creating a broader perspective with all responsibilities; every person has his own responsibilities. A
lot of big organizations don’t have a CIO, but a combined function of the CFO
o If the CFO is also responsible for the CIO domain, the IT development is organized on purely
finance; cost-driven. In this case you will become behind your competitors, because steering
on costs shouldn’t be the key driver for developing the organization
Smaller organizations (<500) often don’t have a CTO, but outsource technology. Besides that, the
CTO is a technical person that don’t perform really good at board level.
Important: IT, software, or technology can always go wrong!
Robotic Process Automation (RPA): included a lot of artificial intelligence. It can do text analysis; e-
mails from an angry person, then its classified to high priority. It makes life more easier
o Artificial intelligence: examples; service chat-robot, anticipating scripts on websites
1
,Strategy (what)
Drivers of change: organizations have business issues and purposes of sustainability, profit and
growth. In the environment of the organizations are changing things that influence the strategy of
the organization. There are a view drivers which are at this moment very technology related;
o Rapidly changing technology;
technology is changing fast. The bigger
an organization, the harder it is to
follow this changes rapidly
o Internet, E-commerce & Social media;
organizations are struggling with filling
in their place on social media; faster
o Privacy; GDPR (AVG)
o Continuous innovation
o Reduce time-to-market
Challenges for IT planning and governance; have some overlap with the business drivers of change
o Compliance; all organization
should comply to the
regulations of the GDPR
o Architecture; close relation
to developments like cloud
computing, from on premises
landscape to a more cloud
related landscape
o IT demand management;
when you outsource you
have to organize your
demand management to
control the IT environment
o Modern development (cloud
computing); cybercrime and
security
Relationship between governance, business IT structure and environment and the value proposition
on those items; lower costs, better control, better relationship, more effective tracking processes,
reduce time, reduce costs, more speed, higher quality. But in real life organizations are struggling
getting a proper business strategy and aligning them to the technology innovation to have a
consistent strategy and get the value proposition
Critical pillars to achieve alignment
Leadership; especially the role of the CIO, so you have knowledge and skills on the leadership
level, with the decisions rights to be successful on the IT governance
Flexibility and scalability; flexible and scalable process to be able to adapt the IT governance
to the technology innovations and to adapt to the strategic changes
Enabling technology; focus on tooling, supporting software, integrating application
Components of an effective alignment; 4 quadrants of the strategic alignment model
o Business component; business scope, distinctive competences, business governance
o Organizational process and infrastructure; administration structure, processes, skills
o IT strategy; technology scope, systematic competencies, IT governance
o IT process as an infrastructure; IT architecture, processes, skills
2
, Strategic Alignment Model: Aligning the business strategy to the IT strategy, only when those are
aligned they are strengthening each other. Every organization has the challenge of aligning the
strategies they have to each other and to their operations. The model illustrates how strategy is
positioned within the organization and the role of IT aligning them functional and strategically
o Functional integration: in the
business scope you define your
strategy (what). You would like
to have the same things done for
your IT-strategy, where there
should be a fit between both.
Alignment between both
strategies as well as both
operational layers
o Strategy fit: Process aligning
from (IT) strategy to operation. A
lot of organization can succeed in
this, because they have a lot of
people in the which have
experiences steering an
organization. It becomes more
difficult when you have to
prepare for an organizational
change as well!
Automation linkage: alignment between all four of the quadrant. There should be an
IT-manager/information manager with feeling for the business and who is able to talk with the IT-
people
IT governance is on a strategic level in the organization, IT management on the operational level
The strategic alignment model is not on scale; business pillar 90%, IT/information pillar 10%!
However, big organizations who grow at the moment can have a 50%-50% situation, or even more IT
people than business people; driven by technology
Data driven: when an organization have clear dash boarding, strong KPI’s and KRI’s, completely
automated, and alerting things. Its predictive based on what happened today and last year;
predictive analysis will help you make decisions. In order to be data driven, the organization need an
IT-strategy; functional integration between business and IT aligned
o Change to data driven; the alignment between business strategy and IT-strategy is difficult if
you don’t have people with specific knowledge, don’t have a strategic focus on being more
innovative, or have a legacy landscape with all custom build software form the 90’s
Pyramid: few people on board level, some middle management (together 10%), and all the people
working at the organization (90%) at the left bottom quadrant. When implementing a new ERP-
system the organization has more or less hierarchy in the organization or more self steering teams
Ability of change and organizing the change is required for an adequate adoption of new IT system
Organizations have problems when they are not adequately organized! Even when they have good
business strategy, become very enough innovative, are data driven, and have modern systems. This is
often caused by not having the right people in the right place.
3
There are 2 types of questions (What and How):
Strategy: knowing how to create a vision, how to change the
IT infrastructure to be future proof and ready for the new
generation. What do you want to be as an organization?
Governance: How are you able to achieve what you want to be? How do you organize things
to take care that you will achieve your strategy goals? In governance there are 3 focus areas
o Enterprise governance; on the ownership/board level. separation of ownership and
control of the organization. Below this level you have;
o Business governance; Direction and control of the business plan and strategy by the
CEO which is focusing on the overall responsibility of the business governance, and a
CFO which is focusing on the financial part
o IT governance; Direction, control, and execution of IT plans and strategies by the CIO
which is focusing on the IT governance
Different C-levels:
* Owner, CEO, people in charge; situated at the left top quadrant
* CFO (finance officer); situated a bit to the right, but at the top quadrant. Responsible for
finance, which is situated in an ERP-system, and therefore also responsible for the IT
* COO (operational officer); situated a bit to the right, but at the top quadrant
* CRO (risk officer); situated at the top right quadrant
* CIO (information officer); Combined function of knowing things about business, finance, and
information; background in business knowledge, business management, IT management,
quality of information. This function is often combined with the CFO because of logical
perspectives, however this is not the best to do so (it could work though)
* CTO (technology officer); technical person at C-level; rare feature. Positioned a level lower
than C-level, because he/she doesn’t fit on board level meetings.
o Nowadays combined with CIO, through the increase of cloud computing where the
technology environment is outsourced. But still there is information that comes out
of the systems. IT information can provide business leverage and be a driver
Big organizations have all the C-level types in their organization. They have the ideal situation of
creating a broader perspective with all responsibilities; every person has his own responsibilities. A
lot of big organizations don’t have a CIO, but a combined function of the CFO
o If the CFO is also responsible for the CIO domain, the IT development is organized on purely
finance; cost-driven. In this case you will become behind your competitors, because steering
on costs shouldn’t be the key driver for developing the organization
Smaller organizations (<500) often don’t have a CTO, but outsource technology. Besides that, the
CTO is a technical person that don’t perform really good at board level.
Important: IT, software, or technology can always go wrong!
Robotic Process Automation (RPA): included a lot of artificial intelligence. It can do text analysis; e-
mails from an angry person, then its classified to high priority. It makes life more easier
o Artificial intelligence: examples; service chat-robot, anticipating scripts on websites
1
,Strategy (what)
Drivers of change: organizations have business issues and purposes of sustainability, profit and
growth. In the environment of the organizations are changing things that influence the strategy of
the organization. There are a view drivers which are at this moment very technology related;
o Rapidly changing technology;
technology is changing fast. The bigger
an organization, the harder it is to
follow this changes rapidly
o Internet, E-commerce & Social media;
organizations are struggling with filling
in their place on social media; faster
o Privacy; GDPR (AVG)
o Continuous innovation
o Reduce time-to-market
Challenges for IT planning and governance; have some overlap with the business drivers of change
o Compliance; all organization
should comply to the
regulations of the GDPR
o Architecture; close relation
to developments like cloud
computing, from on premises
landscape to a more cloud
related landscape
o IT demand management;
when you outsource you
have to organize your
demand management to
control the IT environment
o Modern development (cloud
computing); cybercrime and
security
Relationship between governance, business IT structure and environment and the value proposition
on those items; lower costs, better control, better relationship, more effective tracking processes,
reduce time, reduce costs, more speed, higher quality. But in real life organizations are struggling
getting a proper business strategy and aligning them to the technology innovation to have a
consistent strategy and get the value proposition
Critical pillars to achieve alignment
Leadership; especially the role of the CIO, so you have knowledge and skills on the leadership
level, with the decisions rights to be successful on the IT governance
Flexibility and scalability; flexible and scalable process to be able to adapt the IT governance
to the technology innovations and to adapt to the strategic changes
Enabling technology; focus on tooling, supporting software, integrating application
Components of an effective alignment; 4 quadrants of the strategic alignment model
o Business component; business scope, distinctive competences, business governance
o Organizational process and infrastructure; administration structure, processes, skills
o IT strategy; technology scope, systematic competencies, IT governance
o IT process as an infrastructure; IT architecture, processes, skills
2
, Strategic Alignment Model: Aligning the business strategy to the IT strategy, only when those are
aligned they are strengthening each other. Every organization has the challenge of aligning the
strategies they have to each other and to their operations. The model illustrates how strategy is
positioned within the organization and the role of IT aligning them functional and strategically
o Functional integration: in the
business scope you define your
strategy (what). You would like
to have the same things done for
your IT-strategy, where there
should be a fit between both.
Alignment between both
strategies as well as both
operational layers
o Strategy fit: Process aligning
from (IT) strategy to operation. A
lot of organization can succeed in
this, because they have a lot of
people in the which have
experiences steering an
organization. It becomes more
difficult when you have to
prepare for an organizational
change as well!
Automation linkage: alignment between all four of the quadrant. There should be an
IT-manager/information manager with feeling for the business and who is able to talk with the IT-
people
IT governance is on a strategic level in the organization, IT management on the operational level
The strategic alignment model is not on scale; business pillar 90%, IT/information pillar 10%!
However, big organizations who grow at the moment can have a 50%-50% situation, or even more IT
people than business people; driven by technology
Data driven: when an organization have clear dash boarding, strong KPI’s and KRI’s, completely
automated, and alerting things. Its predictive based on what happened today and last year;
predictive analysis will help you make decisions. In order to be data driven, the organization need an
IT-strategy; functional integration between business and IT aligned
o Change to data driven; the alignment between business strategy and IT-strategy is difficult if
you don’t have people with specific knowledge, don’t have a strategic focus on being more
innovative, or have a legacy landscape with all custom build software form the 90’s
Pyramid: few people on board level, some middle management (together 10%), and all the people
working at the organization (90%) at the left bottom quadrant. When implementing a new ERP-
system the organization has more or less hierarchy in the organization or more self steering teams
Ability of change and organizing the change is required for an adequate adoption of new IT system
Organizations have problems when they are not adequately organized! Even when they have good
business strategy, become very enough innovative, are data driven, and have modern systems. This is
often caused by not having the right people in the right place.
3
