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For a company to achieve digital transformation, do you think IT needs to understand business or does business need to understand IT?
Accepted Answer Pending Moderation
Is a third option available? For example, people who are doing the digital transformation must understand business, IT, both of them together, customers, systems, ecosystems and, again, all of mentioned above together.

Thanks,
AS
Comment
  1. John Morris
  2. 2 weeks ago
  3. #5812
Good approach @Alexander: "both/and" instead of "either/or". (The original question is great and stark in its simplicity, just waiting to be clarified.) So who can be the agent that spans both technology and business? Is it the architect? :)
Enterprise architect? Who else?
  1. John Morris
  2. 2 weeks ago
  3. #5814
:)
Sure Architecture important for supporting software delivery but must be business knowledge that drives creation ...accountants should step back into ensuring assurance on data creation to help their business colleagues...
Architecture considers the whole enterprise as a system within its ecosystem and communicating with its customers.
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IT provides a service to the business - the business is their customer. As with any customer, they may do some educating but the customer is always right...
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Accepted Answer Pending Moderation
For starters, digital transformation, to me, is a subset of a larger phenomenon called Business Transformation (nowadays almost all business activities have become or are becoming digital anyhow).

Next up, both options are true. For sure it will help if people IT understand the business (or even better, have worked in the business) and the other way around. I even dare to make a more bold statement by saying that, given the fact that we live in 2018, organization should start considering IT to BE (part of) the business. Once you start seeing and treating busienss and IT as different entities within one organization, you are automatically creating little kingdoms. By treating them as one group, all working towards the strategic goals, internal alignment becomes easier and more effective.

From personal experiences having worked both in IT and in the Business (as supply chain manager, it doesn't get much business-ier than that) I can tell you that I can be much more effective in my current role because of the combined experience and knowledge on mutual consequences of decisions taken.

So, getting back to the main question: they both should understand each other and one way you can "cultivate" this situation is by facilitating tour of duties of "business' people in IT and vice versa.
BPM is all about mindset first and toolset later....much later
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Simple, simple, simple.....- IT needs to understand the business. The technology needs to understand and enable the business. It's happen stance for technology to provide a panacea to the business without understanding the business. In some cases but a rarity, smart business folks go and understand the technology and understand how to leverage it. So fun technologists create things and that is great, and needed, but nothing has impact unless the technology is translated to the business problem and proposition- that's innovation folks.
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Accepted Answer Pending Moderation
I'm with @Alexander and "both, and", i.e. IT needs to understand business AND business needs to understand IT.

But maybe not so simple! Because we can ask "what is the quality of the ideas in each domain that one must grok"? Lots of popular IT and business ideas are just cliches which provide no competitive edge -- let alone survivability. Instead, let's explore some ideas which can be helpful.

1) IT IS THE DRIVER OF BUSINESS POSSIBILITIES -- What does it mean for business to understand IT? Consider another domain, that of physical engineering, e.g. for bridges or locomotives or micro-actuators or house construction etc. etc. The engineering and calculus for the design of such things is well known. Sometimes innovations come from a "new design", i.e. a mechanical innovation that wasn't thought of before. However, much innovation occurs because of an exogenous system -- in the case of physical engineering, that of materials science. Strong materials make new designs possible. Designs at any given point in time are typically pushing the economic and safety limits of any domain. Those limits can be superseded only when the materials we work with improve. And "improve" can mean both fundamental new science OR significant cost changes, i.e. economics, which amounts to the same thing in terms of design choices. The same thing is true of IT. The revolutionary arrival of relational database theory dramatically changed what was possible in software. And that in turn changed what business could do. In today's terms, the arrival of pattern-detecting AI is an exogenous variable that changes what IT -- and business -- can do.

RECOMMENDATION: Business leaders need to understand what IT can do that's new and different. And "understanding IT" should mean, grappling with real IT. IT-as-the-driver-of-possibility means "driving new investment opportunities", from which business people will have to choose. ANTI-PATTERN: Investing in big data and analytics without tallying newly enabled use cases -- and how market structure is likely to change when competitors do the same thing.

2) BUSINESS ITSELF IS ABOUT WORK -- What does it mean for IT to understand business? Does it mean "business cases" as well as "use cases"? Would it help to understand corporate governance and stock prices? Certainly! Especially as IT can be about change, it's worth having a sense of corporate strategy, economics and competition. But understanding high-level business management sometimes misses the link between IT and business. IT is directly about automation or work and improving business decisions. One gets more work done with the same resources (line productivity). Or one makes better decisions with the same resources (management productivity). And what work? We are now beginning to concern ourselves with the "work of the customer", which shows up as "customer journey" or "customer experience". In both cases, IT is enabling new ways of working. It's worth reviewing the meaning of work, which is "purposive expenditure of effort" -- in other words, we are working towards some outcome -- this is now showing up in the #JobsToBeDone idea.

RECOMMENDATION: IT leaders should understand how technology contributes to the corporate strategy journey, specifically around how automation enables new ways of working both inside the corporation, and for customers. ANTI-PATTERN: IT delivers a pretty dashboard but does not tally the specific decisions (work w/outcomes) that a great dashboard enables.
Comment
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IT used to report to Accounting & Finance. That made sense when the focus of most of the work was on accounting/admin.

Today we have a mess, where, in some organizations, IT reports to an operations level manager/VP whereas in others the person in charge of IT is a VP/SVP.

I can't get excited over who needs to understand what - in any area of endeavor unless you understand the problem you won't have great success evolving solutions.

However, there does seem to be an ongoing debate re "business/enterprise architects".

"Business Architects vs Enterprise Architects: The Battle Must End" 2016 https://www.linkedin.com/pulse/business-architects-vs-enterprise-battle-must-end-john-maynen/

"The evolution of the business architect" 2017- https://www.cio.com/article/3222880/enterprise-architecture/the-evolution-of-the-business-architect.html

Digital Transformation is all about making good decisions at the right time - we know what managers at any level need to make good decisions - knowledge, experience, intuition, wisdom, data/analytics, decision support tools.

See
https://kwkeirstead.wordpress.com/2018/10/22/the-nature-of-strategic-decision-making/
References
  1. http://www.kwkeirstead.wordpress.com
Comment
Accepted Answer Pending Moderation
Few points here....

1) Business does not understand anything nor IT does not understand anything. There are people who might or not understand and in most cases they disagree.... no easy answer here.
2) All understanding is limited by experience... even if we hope or demand people in IT or people with IT experience to understand the business issues, this is hopeless (maybe with some exceptions) ...as hopeless as to demand that Business people understand IT issues
3) To my understanding the best that we can do, is to offer language, models and the way to dialogue about business/IT or any other critical issues and how deal with them... This is a collaborative action. I would like suggest that BPM might offer such an approach, if we do not make it too technical
4) Last point is that the starting point of such a dialogue should always be the customer value creation....(not Business, not IT)

br. Kai
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With minor exceptions i.e. entrepreneurs, at the time they are starting up a business, are the only folks who gain an understanding of \ experience with the very different needs/skills/tools to evolve strategy versus needs/skills/tools to achieve operational efficiency/effectiveness.

Most corporations set themselves up for strategy to be managed by one group and operations managed by another group. The two groups have different mindsets, different timelines and need different tools.

There are noticeable top-down issues and noticeable bottom-up issues.

I submit that BPM is the best core methodology for achieving operational efficiency and that BPM "plays well" with methods like RALB and FOMM for achieving operational effectiveness, assuming availability of a run-time workflow/workload management platform.

I submit that RBV (Resource Based View) is the core methodology of choice for evolving corporate strategy, providing this is practiced in a 3D free-form search knowledge base environment.
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Nobody here's going to argue that any employee of any business shouldn't have some idea of what business that business is in.

The question really is: what does it mean for the business to understand IT? The business has to be aware of the unique challenges of enterprise technology, and in particular the unique risks IT organizations face: institutional knowledge that walks out the door every night; operational challenges; security. And the business has to appreciate the insane advantages that technology has to offer, while maintaining a humility—a soupçon of self-awareness—that rarely are solutions as magical as they first appear (I offer as Exhibit 1: machine learning).

Still, IT has been known to do amazing things, even in companies led by individuals whose understanding of technology would be challenged at a mid-tier high school science fair. That's because the best IT leaders are fluent in both languages, and can leverage that skill to yield strategies, budgets, and resources.
http://www.bplogix.com/images/icon-x-medium.png
-Scott
Comment
  1. John Morris
  2. 2 weeks ago
  3. #5821
+1 @Scott "soupçon of self-awareness"
Accepted Answer Pending Moderation
Both ways round. I see the problem of not understanding each other every day. As a business analist I'm the loser in the middle to make them understand each other. Maybe that should be an unnecessary role in the end, but the biggest problem I see is when all kind of other initatives like process improvement projects, lean peeps, audit folks etc join the discussion. They all like to defend their position and bring their 2 cents to the table. But ten cents on the table is confusing most of the time.
Sharing my adventures in Process World via Procesje.nl
Comment
Accepted Answer Pending Moderation
Great question! I am fully convinced that with growing accessibility and intuitiveness of "transformative" technologies, the responsibility on the business side grows to adopt, understand and to strategically implement, and use said tech. The level of which business operatives and executives will have to follow suit, will likely depend on the competitiveness of the given vertical the involved company finds itself in. One can observe analysts (eg: Gartner/Forrester) argue that in a diverse and competitive market setting, companies increasingly rely on strategic technology implementations in order to leverage their strengths and respective advantages. Such an undertaking then, can be hardly left solely in the hands of a small number of IT people that are struggling to abstract a working model of an ever changing business environment but must rather be something fully embraced by the entire corporation, with its business people at the very forefront of the battle.
References
  1. https://www.gartner.com/doc/3891569/top--strategic-technology-trends
NSI Soluciones - ABPMP PTY
Comment
  1. John Morris
  2. 2 weeks ago
  3. #5823
@Kay -- Your comment is very deep, re: the "intuitiveness" of technology and the "responsibility" of business-side leaders. I have written about this in terms of "management wait states". It used to be that management would come up with ideas for automation or product changes, to be implemented in IT. Then IT would take it away and management could "relax" for a while (and in the 60's literally relax, on the golf course). Then IT would come back a few months later and say "how do you like it" -- and management would have to put on their hard thinking caps again for a few days, and so on and so on. Lots of "wait states" between idea generation and idea instantiation. However, with agile and RAD and BPM and other rapid-idea-embodiment technologies (as you say, "intuitive technologies"), management wait states have been stripped out. Management is now "under the gun" to be generating new ideas on a continuous basis. There are several implications. First, idea generation can't be quite so ad hoc; you can't generate good ideas continuously unless those ideas are part of a framework. And secondly, it puts a lot of pressure on management. Management typically already works very hard. Being continuously creative is "new work" and not everyone is up for it. it will separate "the adults from the children", over time.
  1. Kay Winkler
  2. 2 weeks ago
  3. #5824
Hi! Thanks for your comments and insights! The notion of decreasing creative cycle times is indeed an important one!
Accepted Answer Pending Moderation
IT has failed to recognise how data is created..it's people and processes...hence the emergence of BPM. With the arrival of no code to deliver digital IT no longer the driver it now is in hands of business knowledge to build and support change. Accountants should be well placed to help business colleagues to deliver...they were mapping processes in the 70s....then IT took control as business and accountants were fooled into believing the vendor hype! Of course to deliver needs use of legacy required and so business needs to understand and use IT but business is the driver.
Comment
  1. Kay Winkler
  2. 2 weeks ago
  3. #5822
I agree!
Accepted Answer Pending Moderation
Many here seem to subscribe to the need for enterprise architecture.

A possible follow-on question is what percent of not-so-large organizations have resident enterprise architects who can make strategic decisions and work with IT on digital transformation?

I found a 2015 post "What's your corporate IT strategy" (2015-09-02). https://kwkeirstead.wordpress.com/2015/09/02/whats-your-corporate-it-strategy/

I don't see that much has changed over the past three years.
References
  1. http://www.kwkeirstead.wordpress.com
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