IT has become integral to many aspects of business, from marketing and customer engagement to new product design. This requires a new way of organizing and engaging across functions.
How important is this cross-functional engagement? It's huge. Seventy-five percent of the 750 respondents to our global survey (see “The Leadership Edge in Digital Transformation," from HBR Analytic Services) say that their company's survival depends on their ability to effectively exploit IT, and almost all — 90% — said that collaboration and communication between IT and other stakeholders in the business is essential to their ability to do so.
There's a lot of room for improvement. Forty-three percent said their organization has a poor track record of collaborating across functions. That shoots up to two-thirds (66%) at companies with slow-to-respond IT departments.
Some best practices to address this challenge are starting to emerge. These include:
- Establish a cross-functional business IT strategy board at the highest levels of the organization — Emerson has a great model for this
- Encourage job rotations into and out of IT
- Appoint business relationship managers — IT staff that "live" in the business
- Physically co-locate IT developers with their business counterparts
- Have dual reporting to the CIO and another function leader for areas that are heavily IT enabled
The CEO has to push this dissolving of silos and greater collaboration, and certainly LOB and functional leaders have to buy in. But leadership to make it happen falls to the CIO. One of the biggest challenges CIOs face in this regard is coaching their own teams to come out of their IT bubbles and engage effectively with clear communication and a positive, can-do attitude. Collaboration between IT and other parts of the business is a necessary condition for digital business. Companies that are good at it will move farther, faster.
This is the second of a three-part series.