IT and Business Capabilities Linked to Core Competencies

It is the way in which an organization deals with the environment that has changed and that can set it apart from the crowd. The best opportunity lies in dealing with challenges as a whole rather than as individual challenges and bringing technology to the forefront as the best weapon you’ve got. Along with the people who manage it and who use it, information technology (IT) now represents the nucleus of most core competencies. Sustainable success means staying ahead of the pack and throwing up dust as you go in the hope that your competitors won’t see the way forward as clearly as you do.

In nature, the species that thrive are those whose reflexes are instinctively fast and those who adapt readily. Powerful, dominant species became extinct because they were unable to adapt to their environment. In the business world, some organizations thrive and prosper in dramatically changing times while others simply fade away. The difference is not in the degree of desire to succeed; rather, it is in how the organization has equipped itself to achieve success. Just as in nature, an enterprise that has embedded into its organization, processes, and infrastructure the ability to learn and to adapt thrives in a changing environment.

Morphing into a sleek, agile enterprise that can withstand the buffeting winds of change without jeopardizing the organization’s very existence depends on the synergy and flexibility of its people, processes, and technology. The interdependencies that result from an agreeable and harmonious relationship among these three dynamic entities reinforce (and are simultaneously reinforced by) the firm’s resilience and provide it with the strength needed to survive.

A key responsibility of today’s manager is ensuring that the organization has the most appropriate mix of skills, processes, and knowledge to support the continued development and enrichment of the core competencies needed to support this level of adaptedness. In addition to the specific technical skills required to run the IT operation, this obligation necessitates a mix of IT and business-related skills across the organization and at all levels.

Executives and senior managers must understand the potential that IT offers. Business strategy and IT are so closely coupled that neither one can be considered in isolation. In addition, almost every investment decision made today involves some discussion of IT. The adoption of a new business model, the streamlining of existing processes, and potential mergers, acquisitions, and alliances all have an IT element. Knowing what technology can do and how it can best be applied and exploited represent invaluable skills and knowledge for an executive.

There are few, if any, processes that do not involve IT. Most work today involves the use of IT at some point. Unless the people who participate in the processes and who actually use the technology understand its potential, there is little opportunity for them to guide the organization in further exploiting its value.

IT managers and employees belong to the team that is the organization. In the past, they supported the business team – not quite at arm’s length, but almost. Today, however, they belong to the team. These IT managers and their staff need to become much more aware of what the business does and how it does it in order to participate in a meaningful way to help other team members develop a better understanding of what IT can do.

When these capabilities are integrated with business processes, business rules, knowledge bases, and other enterprise applications, an organization can have some confidence that it has the ability to manage its workforce in the most adaptive way possible. The ability to gain rapid and real-time access to (and to deploy) the “best brains” regardless of their location is a core competence that is really difficult for a competitor to duplicate.

You can begin to determine whether you are moving in the right direction by asking yourself the following questions:

• Does your organizational structure provide the flexibility needed to bring the most useful resources – regardless of location or functional affiliation – to bear on the most promising opportunities?
• Is every worker encouraged to contribute to the early detection of both internal and external changes and trends, and are systems in place to capture this input?
• Does the overall organizational culture continue to evolve in a way that engenders self-initiative and a collective sense of responsibility for the strategic exploitation of technology?
• Are ideas that are unusual or “different” encouraged, and are employees rewarded for their creative contribution regardless of the commercial outcome?
• Does your recruiting process balance the importance of competence and “strategic fit”?

A mutual understanding of why the organization is in business, how it proposes to remain in business, and what tools it can use to make it succeed creates the foundation that underpins the development of capabilities that are very difficult to undermine. A strategy that is developed on this foundation of knowledge is strong, and it benefits from the combination of business and technology foresight needed to provide a consistent, logical view of the organization, its context, and its environment. To put it very plainly, organizations must be able to align their available talent, processes, and knowledge with changing needs, almost on the fly.

Read more IDC research on IT/Business Alignment.