Disconnect Between Business and IT
Disconnect between business and IT happens when the company does not see the IT department worthy of a long term investment. Their business plans do not focus on the IT innovations.
What Is a Disconnect Between Business and IT
Disconnect between business and IT means that the companies do not consider long term IT innovation in their business plans for a fiscal year. In fact, they prefer fixing issues currently at hand. There is a clear disconnect between companies and their IT departments nowadays, both ideologically and financially. Companies worldwide should acknowledge the IT departments' true value and stop separating them from the business plans.
A 2013 Kovarus Survey showed that only 28% of IT decision makers prioritize the long term innovations.
Source: Kovarus Survey
This survey also found that:
- the companies do not have clear decision-making criteria for IT budgets.
- only three subjects make business decisions based on the big picture of the fiscal year goals.
- most of the critical decisions are made without the correct IT-business insight.
- 35% of the companies in this survey do not follow any specific process in determining their IT spending decisions. They decide what to spend and where ad hoc. Therefore, the IT department cannot demonstrate accounting transparency.
The business units make independent decisions about investments in the IT departments without an understanding of the value the IT department brings to the company. The inappropriate budgeting for IT could be a result of lack of knowledge at the top of the companies. Top managers are often separated from the IT department by analytics which creates the “Us vs. Them” mentality. IT departments need effective business models to close the gap between IT and the business.
Reasons for the Disconnect Between Business and IT
- Management Management is separated from the IT department. The reason could be the relative newness of the IT departments.
- Focus on the technicalities The functionalities are not verifiable on clients because the IT department is separated from them. The main focus is on the technical solutions.
- No sense The principle of business is not fulfilled. The business units do not see the sense in the development.
- Redundancy Developers are working on something that the clients do not want.
- Lack of information Developers are not informed. They either do not know what are they working on, or they do not understand its purpose.
- Budget The company has some budget difficulties. Sometimes the decision makers are just not able to allocate as much money as they want to.
- No cooperation The IT department is often noticed only when something breaks.
Long story short, the companies should to start looking at the big picture regarding their IT departments, business models and therefore their future. Good news is that the current business trends focus more and more on trying to close the gaps between IT and business as much as possible. The Kovarus survey was implemented in 2014 and there have been some changes since then. However, the ideal business-IT model is still far in the future.