The entirety of IT project strategy can be broken down into three central themes. First there is integration, unifying organizational units horizontally through a cross-pollination of information. Then there are dynamic requirements. IT must continually evolve with the business. And lastly, there are abstract drivers; business processes, objects, and services define the IT project. Glen Alleman describes why none of these themes qualify as operational effectiveness in his blog Herding Cats.
Is Your Company “Fit?”
It’s all about “fit.” Fit is when many components operate effectively together as a whole system. Operational effectiveness is what takes over when each component is managed separately and independently, without any strategic fit. For a manager to mistake operational effectiveness for strategy is to manage tactically, leading the business away from “bigger picture” gains.
Operational effectiveness is:
- Constant change
- Relentless improvement efforts
Strategic effectiveness is:
- Making tradeoffs
- Tightening fit between components
- Reinforcing or expanding market position
Fit is the foundation of an organization’s competitiveness. If one area suffers, it should affect other areas, incentivizing solutions. Likewise, proper fit allows one business area’s gains to spill over, improving other areas.
Finding Your Rhythm
A method that can draw together the benefits of strategy and operational effectiveness is the Balanced Scorecard:
If we are going to make tradeoffs in pursuit of strategy, we need to know what those tradeoffs are, how much will be the opportunity cost for each trade and how each trade impacts our strategic decision making.
Connecting the dots between vision, objectives, strategic objectives, performance goals, and critical success factors requires a sound estimate, a place where everything can happen under one roof interconnected and in working harmony.