During my interview for the company for which I now work, I wasasked, “How would you create an IT strategy?” That's easy becausewe're not a technology company, we're an insurance company. Thereis no “IT strategy,” just an IT element of the businessstrategy.

I've been a part of initiatives driven by IT that weretechnology for the sake of technology. For example, an “AS/400 Javanew core systems” project was great technically, but didn't solve apressing business problem (result? FAIL). On another project, wewere building some amazing components using very cutting-edgetechnology. The only problem is that we weren't delivering businessvalue (FAIL).

Now before you walk away from this blog post thinking I'm acomplete failure in life, I've learned a lot from those failures.Most importantly, IT is a business support function first and a technology function second.The IT cart can never come before the business horse.

How do you align to the business, then? Start with this: It'snot the responsibility of the business to understand IT, but it isIT's responsibility to understand the business. If you can't digestthings like time to market, product/state variability, compliance,and soft/hard market swings, you can't develop the IT elements thatcomplement the business strategy.

Interested inmore Frank Neugebauer Insights on Technology? ClickHere

For each element of the business strategy, figure out how toadjust, replace, add, or remove IT capabilities to accomplish thosegoals. For example, if getting quotes out the door quickly toincrease market penetration is the business goal, then integratewith third-party systems; increase the speed of applications withhardware upgrades; and describe, understand, and adjust thebusiness process to maximize operational effectiveness. The pointis to support the business, not override it with technonirvana.

I believe there are opportunities for IT to drive businessinitiatives, but that's usually in execution. IT may find newchannels (see Facebook), more efficient information processing, oreven develop new services. But I've seen too many leaders startwith such thinking. That's like flying before you walk, and theresults are usually less than stellar.

For the sake of completeness, there are a couple elements of ITthat are industry agnostic, including:

Software strategy: The three main approachesare vendor lock, best of breed, or hybrid. Withlock, you choose a platform, stick to it, and get engaged in largercost-effective deals. Benefits include reduced procurement, easierintegration, and reduced support costs (since you have fewervendors to understand). Detriments include loss of flexibility, and“lock-in syndrome,” where both the company and the vendor becomecomplacent. With best of breed, you pick software ala carte.Benefits include flexibility and a healthy tension caused by theurgency of competition. A hybrid means picking areas to lock (e.g.,systems management) and areas to choose (e.g., businessapplications). The most common approach is hybrid, almost bydefault because most business applications are ala carte.

Hardware Strategy: Just like software,companies can lock, pick, or hybrid. It's common to see some formof lock, but the vendor can vary between servers and desktops. Thesame benefits and detriments exist as with software. (On a sidenote, smart phones and tablets are forcing hybrid approaches.)

Don't let me mislead you—even in those two cases, the ITelements must still support the business strategy. For example, ifthe business is looking to expand through acquisition, it'sprobably not the best time to deplete cash stores by refreshing theentire hardware environment. Seems so simple, but I've seen sucherrors more than once.

I once worked at a small non-standard auto carrier and spent alot of time with the CEO. He was the first person I ever heard say,“We're not an IT company, we're an insurance company.” That is thecompass that directs my decision making. The simple truth is thereis no such thing as IT strategy in insurance, just the IT elementof the business strategy.