Organizations pursue alignment with vigor in the hope of maximizing value. Does perfect alignment equal perfect value? The short answer is no!
Does Alignment = Value?
For more than a decade now the holy grail of IT management has been “Business IT Alignment” – making sure IT investments are in line with business requirements.
Makes sense. If all your IT investments are not supporting a business need then by definition you are going “IT for IT’s sake” or something worse!
However, is the reverse true i.e. does perfect alignment ensure perfect value?
Unfortunately, the answer is an unequivocal NO!
Let me take an admittedly corny analogy to explain. The concept of IT alignment is analogous to “wheel alignment” in a car. (There are many faults with this analogy but for the purpose of this discussion it fits.)
Will a car that is out of alignment give the best gas mileage? The answer is NO. If all four wheels are not aligned with the movements of the car – forward or backward – then they are working against fuel efficiency. Worse they are working on destroying the tires!
However, is the converse true? If a car has perfect wheel alignment then has it optimized fuel efficiency? Unfortunately, as we all know the answer is NO! To name just a few reasons why the car still might not be giving maximum fuel efficiency:
- Engine is not tuned
- Spark plugs might not be clean
- Air filter might be clogged
- Oil filter might be clogged
- New tires = lower mileage
- Bad driving = bad mileage
In other words, wheel alignment does not ensure maximizing fuel efficiency or shall we say, value creation
Alignment is a prerequisite to value creation. However, it is a necessary but not sufficient condition for optimal value creation. The other factor in the equation is asset utilization. Together, they determine value creation.
There is an excellent article on the topic by Bain & Co. consultants.
