Demand Shaping; the next frontier of IT

09/22/2016

If you’re a tech executive tired of the catchphrase, “align IT with the business,” you’re not the only one.

Senior ITZ leaders genuinely do want to bring their organizations in line with strategic business goals, but often they find the relationship isn’t exactly an equal partnership. As Mihir Shah, CTO of the asset management group at Fidelity Investments, quips, “Perfect alignment is when the business gets whatever it wants, whenever it wants.”

When resource-constrained IT has to deal with multiple business units simultaneously – all demanding what they want when they want it – the situation quickly becomes unsustainable.

As the digital transformation continues to accelerate, the pressure on IT will continue to mount; is there a better way to create an efficient and satisfying partnership?

The answer, according to MIT’s Center for Information Systems Research (CISR), is yes, due to a concept known as “demand shaping.”

There are six key elements in the MIT CISR toolbox:

  • IT cost transparency
  • Strategic program management
  • Roadmapping
  • Business relationship management
  • Post-implementation reviews
  • Agile development

IT executives at Staples, HP, Charles Schwab and BMW have publically discussed their use of demand shaping. Demand shaping is a sound method for creating a foundational platform that can serve the needs of subsequent projects.

Demand shaping is an effective way to do more with less, a way to get more bang for your buck.

Demand shaping is “a way to turn the conversation from IT being an order-taker into one where we can enable opportunities with outcomes,” says Herve Coureil, CIO of $26 billion global energy management and automation firm Schneider Electric.

How demand shaping works

The six steps in demand shaping all aim to turn what has traditionally been a one-way interaction – with IT in the unwanted and ineffective role of order-taker, into an ongoing, two-way dialogue. “Thus business needs to provide more clarification to the CIO about where it’s going and why, and what outcomes it’s expecting,” says Ross. “Then CIOs need to say, ‘If that’s our strategy, then here are the capabilities we need.’ There’s no point in building capabilities that don’t help the company.”

The discipline also forces CIOs to focus on the whole organization, rather than individual businesses, and to set and pursue long-term priorities rather than short-term goals. “CIOs want to meet needs and keep people happy. But if there is no clear prioritization of what’s important [for the entire company], IT can’t be strategic,” Ross explains.

Article source: Computer World