The IT Portfolio is the place where 'Demand' and 'Supply' of IT meet. In the picture the dotted line shows the separation in responsibilities between Demand side and Supply side of the Portfolio. But where exactly is that separation to be found? What exactly is the responsibility of the Business and what is the responsibility of IT in managing the IT Portfolio?
We now enter the realm of 'organizing IT' and 'IT Governance'. Many books and website are available on these subjects, so I will limit myself to the basic idea's that I used in my practice when (re-)organizing responsibilities in the cases of Mergers and Acquisitions that I was involved in.
It is not just important 'who is responsible in an organisation for the effectiveness of IT', but much more 'what is the language that we use in our day to day communication on this subject?'. How do we express the required IT support in the Business and what is the language of the IT Provider?. Both languages are frequently blurred with phraseology that tends to be popular at a given moment in time (e.g. 'in the cloud') without a clear consensis of the meaning.
Where are the primairy responsibilities for 'Demand and Supply' of IT?
When working on the merger of a number of Provincial Energy Companies, I used the following principles:
1. 'the Business' defines the required IT and as suchs directs the Demand of IT, the Business is also supporting the IT function in suppling the required IT.
2. 'the IT Function' defines the offerings and as such directs the Supply of IT Services, the IT Function is also supporting the Business in formulating the Demand.
How 'fat' or 'thin' the IT Function should be is dependent on the Strategic Role of IT (see the articles on Strategy). I will addres this subject in other articles in this series.
What is the language we use when we communicate on the IT Service Provisioning?
It is highly denpendent on the percieved rol of IT in an oganization (see the articles on Strategy) what language is spoken:
- do we want to do IT ourselves or do we want to source it from an external provider?
- do we have the required skills and craftsmenship on board or should we hire?
- is the 'standard off the shelve solution' good enough for us or do we need 'tailor made' IT?
- how measurable are the results of our (internal of external) IT provider?
- do we use Service Level Agreements (SLA)?
In the case of the above mentioned merger, the focus was on professionalizing the internal IT Service Provider. We defined a growth path in 'governance'.