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Understanding Your IT Maturity Is Key to Business Success

Colleen Young

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IT Contributes Directly to Business Goals Know Where YOU Need to Be

Functional Enabling Contributing Differentiating Transformational What the enterprise Chief Executive says We must keep our business running well and efficiently Business leaders have the leeway to use or invest in technology as required to meet their objectives Business and IT leaders are held accountable for enhancing operations and raising business performance Business performance We depend on information and technology to develop and sustain sources of competitive advantage By operating at the cutting edge of information and technology, we change markets and rules of competition Ingenious application of info and tech IT = market maker Measure = new market, revenue, competitors Emphasis = transform Focus = breaking the rules

With that intention, the enterprisewide CIO will focus on IT performance and assets Business support Scale, reach time to market

And the IT organization will look like this IT= utility Measure = uptime Emphasis = budget, FTEs Focus = cost and efficiency IT= responder Measure = response time Emphasis = run portfolio Focus = meeting expectations IT = problem solver Measure = business performance Emphasis = run and grow portfolio Focus = business results IT = differentiator Measure = new products and services Emphasis = grow and transform Focus = markets

Enterprise IT Maturity Five Levels

Business Focus
Transformational

Differentiating

Back Office Bias

Enabling

Contributing

Front Office Bias

Functional

Technical Focus

Enterprise IT Maturity A Story of Compounding Leverage and Value

Enterprise IT maturity measures the enterprise's collective willingness and ability to leverage IT in pursuit of business objectives.
Level 1 Functional The enterprise regards IT as a commodity most useful for cost-effective transaction processing. Level 2 Enabling The enterprise is focused on continuous improvement. Business unit leaders independently leverage IT as and when they consider it necessary. Level 3 Contributing The enterprise is focused on pushing its boundaries through scientific management. IT is critical to achieving business performance goals. Level 4 Differentiating Level 5 Transformational

The enterprise is The enterprise is on a path of continuous committed to reinvention. IT is a dominating its primary driver of industry. IT is a business model source of agility innovation. and product/ service innovation.

IT is a utility. It efficiently delivers a limited set of core capabilities.

IT reliably and predictably delivers technology services and solutions on demand.

IT is engaged in addressing explicit business problems or opportunities. Its contributions to business performance are well-understood.

IT collaborates with other disciplines, such as R&D, BPM, and OT, to deliver new products, services and differentiating operations.

IT is leveraged to redefine markets and rules of competition.

Enterprise IT Maturity Seven Defining Dimensions

Strategy and Vision

Executive Leadership Business Mind-Set Toward IT

Business and Financial Management People and Skills

Technology Leadership and Management

Performance Management

IT's Path to Strategic Contribution Representative Milestones

The CIO and Senior Executive maturity assessment measures the IT organization's capability to deliver against enterprise expected contribution levels
Level 1: Functional Level 2: Enabling Level 3: Contributing Level 4: Differentiating Level 5: Transformational

CIO is a fully-vested business leader TechIT nology Performance Strategy is Measures Explicitly are tied to Aligned to key business Business indicators Goals Strategic human capital management processes maintain appropriate short, mid and long term talent pipelines

CIO has formal accountability for at least some business outcomes

People programs shift from Process skill to management results disciplines are adopted orientation

Portfolio Management is applied to all major resource classes and investment decisions

IT is run like a business

Integrated tools support IT process and cost optimization

Service & Solution outcomes are measured against formal performance obligations

Sourcing is IT Service approached and strategically Solution and based Capabilities on explicit are rockbusiness solid maxims

IT organization proactively identifies & pursues opportunities to leverage technology for strategic advantage

IT leaders fuel agility through extensive external relationships, partnerships and personal networks

IT Leaders drive innovation, pursuing IT enabled opportunity where external competitors find constraint

Gartner's ITScore
A holistic set of maturity assessments that through a series of questions and answers allows clients to obtain not only a maturity rating for a specific role, but to also obtain an enterprise IT maturity score that is sensitive to the interdependencies across roles within an organization.

ITScore goes beyond the IT organization by assessing business leadership, culture and behaviors to identify ALL maturity prerequisites and impacts.

ITScore Is Different
Maturity Models
Focus Maturity Levels Advice Scoring Insights Attributes Linear Cumulative Descriptive Static Where are you?

ITScore
Results Exponential Integrative Prescriptive Adaptive Where do you need to be? Where are you? How do you get there?

Know Where You Are

Three Perspectives to Consider ITScore
1. Complete the required enterprise attributes survey.

Enterprise Attributes
Role Perspective(s)

2. Complete a survey questionnaire for one or more perspectives.

3. Receive a maturity score and interpretive report for each perspective. 4. Receive an enterprise ITScore and explanatory report. 5. Enhance the accuracy of the enterprise perspective by completing additional survey questionnaires.

CIO Perspective

Digging Deeper IT Leader Role Assessments

There are 8 optional role surveys
I&O EA APPS PPM BI

Each produces a score and results report 2 4 4 1 3

Available scores are integrated, producing the Enterprise IT Maturity score and results report

SRM
BPM Sourcing

5
2

Taking It All In A Summary of Dimensions by Level

Management Practices Level 1: Functional Level 2: Enabling Level 3: Contributing Level 4: Differentiating Level 5: Transformational

No. 1 Strategy and Vision

IT keeps the business running and manages operational performance.

IT responds to business leaders who have the leeway to select and use technology to achieve their objectives.
The CIO is not a member of the senior leadership team but reports to a C-level executive.

IT improves business operations and performance in partnership with business leaders.

The CIO is a member of the senior leadership team and reports to a C-level executive or the CEO.

IT and the business use information and technology as a basis for competitive advantage.
The CIO reports to the CEO and is a member of the most senior management team.

IT operates at the leading edge of technology to evolve the business model and change the rules of competition.
The CIO is a member of the executive leadership team. The CIO influences the board of directors or may be a member of the board. The IT team is composed of innovators and experts in the leading-edge application of technology. IT financial management is broad and includes revenue generation. IT performance contributes to the market value of the company.

No. 2 Executive Leadership

The CIO is not a member of the senior leadership team and does not report to a Clevel executive.

No. 3 Business Expectations for IT

IT is a provider of functional infrastructure.

IT is a reactive service provider that responds to business plans, wants and needs for IT.

IT is a proactive service provider working with business leaders to improve business performance.

IT is a leader in using technology and information to differentiate the business. IT budgets spending and revenue generation. Business and IT jointly share responsibility for definition, design and development of solutions.

No. 4 Business and Financial Management

IT budget and management concentrates on service quality and the cost of IT.

IT budgets include IT budgets include all operations and technology assets. IT applications. IT financial management leverages PPM to is focused on ensuring ensure that work the achievement of budgets and schedules business value. are met and portfolios are well-managed.

Taking It All In A Summary of Dimensions by Level (cont.)

Management Practices Level 1: Functional Level 2: Enabling Level 3: Contributing Level 4: Differentiating Level 5: Transformational

No. 5 People and Skills

IT skills are focused on "run the business" requirements.

IT people and skills align with the application systems and technology solutions IT supports.

IT blends business and IT has good knowledge IT people and skills are technical skills. of business strategy, comparable to those of Industry skills are operations, products business executives valued. and services. Some and leaders. cross-organization Leadership of skills are also transformational available. technology is valued.
Architecture covers IT information flows and business processes. Architecture is extended to the company's operating model. Performance Is measured in business terms, including changes in business performance and financial metrics. Architecture describes the organization's technical and business model. Performance is measured in terms of business and market value-add.

No. 6 Technology Leadership and Management No. 7 Performance Management

Architecture represents the technical assets and their relationships. Performance is measured by operational metrics related to cost, quality of service and availability

Architecture includes information systems and relationships.

Performance is Performance is measured by how well measured in terms of IT responds and business value created conforms to the plans, and improvements scope, schedules and delivered. quality for addressing user wants and needs.

Best Practices in Using the Maturity Assessment

Sample Assessment: Your Overall Maturity is 2
Strategy & Vision Executive Leadership
5.0 4.0 3.0 2.0 1.0

Strive for balance:

- Organizations will not have even maturity across all their management practices, but they should work toward that

Technology Leadership

Elevate key management practices:

- Where pain points with the business are most critical - Where quality and credibility is suffering - Where IT direction is misaligned with the business

Business & Financial Mgt.

Business Mindset

Performance Management

People & Skills

Recommendations
Become familiar with the ITScore components and capabilities.
Complete as many as apply to your enterprise.

Conduct "what if" scenarios to understand whether the

opportunity costs of investing in new capabilities are worth it.

Leverage the results as a vehicle for communication

and planning.

Repeat assessments across the organization to test

differences in maturity and/or perception.

Take advantage of comparative results across the enterprise to

more broadly identify and instill best practices.

Repeat the surveys periodically to track progress. Leverage Gartner Peer Connect to learn from external peers
that have also completed the assessments.

Related Gartner Research

"CIO Advisory: Are You Poised to Meet or Miss Executives' Intended Business Results" Diane Morello (G00172003) "ITScore for the Enterprise" Colleen Young (G00205879)

"ITScore Overview for CIOs and Senior Executives" Colleen Young (G00xxxxxx)
"ITScore for CIOs and Senior Executives" Colleen Young (G00170892) "Identifying CEO Expectations and Executing Against Them" Colleen Young (G00170607)
For more information, stop by Gartner Solution Central or e-mail us at solutioncentral@gartner.com.

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