Management by Maxim: How Business and IT Managers Can Create IT Infrastructures

This is an MIT Sloan Management Review article. Creating a business-driven IT infrastructure requires that executives thoroughly understand their firm's strategic context. By formulating a series of business and IT maxims--short simple statements of the business' positions--they can identify the IT infrastructure service suited to their company. The authors' framework has four components: First, consider strategic context. What business demands, roles, and relationships are critical to infrastructure decisions? Second, articulate business maxims. The maxims should focus employees' attention on the firm's competitive stance, the extent of coordination across units, and the implications for information and IT management. Third, identify IT maxims. From the business maxims, executives identify IT maxims. The maxims specify the role of IT and levels of investment relative to competitors, whether processing is tailored or standardized, and how different types of data are accessed, used, and standardized. Finally, clarify a firm's view of IT infrastructure. A company should determine how it sees infrastructure from among four views: none, utility, dependent, and enabling. It can forgo synergies among units and not invest in infrastructure services, use the infrastructure primarily to reduce costs, make investments primarily to respond to current strategies, or overinvest in IT infrastructure to provide flexibility in responding to long-term goals.

• Innovation
• Strategy formulation
• IT management