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Issue of March 2004 
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CIO Panel Discussion TS 2003

Aligning IT with business objectives

A roundtable discussion on the topic 'Aligning IT with business objectives' was one of the important events at Technology Senate 2003. It was moderated by Sunil Chandirmani, partner, Ernst & Young, and the objective was to discuss the need to align a company's IT objectives with its business objectives.

The objective of the discussion was to throw light on issues like the kind of strategies the CIO should use to achieve the objective of alignment; getting the IT budget; the level of knowledge that CIOs should possess about the company's business in order to achieve its goals.

The CIOs belonged to companies from a mix of diverse industry verticals like manufacturing and retail, banking, telecom, and airlines.

Lalit Sawhney, Enterprise Business Unit, Reliance Infocomm said:

Competition is increasing everyday from regional, national, and international companies. We need to be very conscious of what our customers expect from us and be innovative. We must be conscious of issues like cost and quality. So the CIO has to be an equal contributor to the strategic needs of an organization. The CIO has to look at the areas where IT drives business value.

Rajendra P. Erande, Corporate Advisor, IT, Thermax said:

In the past, IT personnel have always been considered 'techies', and there has been a gap in the way the CEO looked at them. But now, the business has realized that it is a good idea to involve the IT team, right from the planning stage for more value in a business project. So it's essential that the CIO aligns IT strategies with business needs.

S.R. Balasubramanian, VP - IS, Hero Honda Motors said:

In the current enterprise scenario there's no need to justify the cost of purchase of IT infrastructure, and the CIO does not need to sell the concept of an IT project to an organization. There is only the need to justify the business value of IT. So here's where the alignment function comes in.

However, the concept of aligning IT with business is not new, and it's very important that the CIO goes beyond the conventional role, understands the business, and takes active part in its development.

C.N. Ram, Head - IT, HDFC Bank said:

I don't think IT is an option anymore. The business heads have reconciled themselves to the fact that they need to work together with IT. The CEO goes to the CIO, offers to support the IT budget, and asks for value and growth in business as a return. So the CIO must go to the business heads and work with them to produce useful results.

M.S.V. Rao, Director, Dept. of IT, Air India said:

Airlines is a highly IT-driven industry and has IT deep-rooted in its business. This ensures that there aren't any issues with the budget.

We follow the philosophy that expenditure for requirements in the IT infrastructure like network upgradation or mainframe and systems development comes out of the IT budget. IT expenditure in areas like user departments, booking offices, and airports come out of the commercial department's budget.

IT needs a lot of governance, like fuel supplies for an aircraft. The top management has to look at IT and thus ensure it’s alignment with business.

Vikram R. SriHari, Director - Business Systems, Coca Cola India said:

I feel that the world is still somewhat diminished and the CIO fraternity is responsible for that. We seem to forget the reason we're here. We're actually here to add profitability to an organization, align ourselves to the business, and bring magnitudes of differentiation with competition.

CIOs have to understand the business strategy and take the IT initiative forward. This will make a change, which will push the company to profitability. The CIO is a trusted custodian to the virtue of the organization.

The panelists:

C.N. Ram,
Head - IT, HDFC Bank

Lalit Sawhney,
Enterprise Business Unit, Reliance Infocomm

S.R. Balasubramanian,
VP - IS, Hero Honda Motors

Rajendra P. Erande,
Corporate Advisor, IT, Thermax

M.S.V. Rao,
Director, Dept. of IT, Air India

Vikram R. SriHari,
Director - Business Systems, Coca Cola India

The moderator:
Sunil Chandiramani, Partner, Ernst & Young

Conclusion

The roundtable panel agreed that in the current business scenario where a company is very dependent on IT for operations, it's essential that IT should be aligned to the company's business strategy.

The CIO should take the initiative to understand the company's business processes very well. This will help him/her add value to the organization's business goals.

 
     
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