CGEIT · Question #407
Facing financial struggles, a CEO mandated severe budget cuts. A decision was also made to immediately change the enterprise strategic focus to put more reliance on mobile, cloud, and wireless…
The correct answer is A. Ask business stakeholders to discuss their vision for the new strategy. Given a new strategic focus and budget cuts, the CIO should first advise the committee to engage business stakeholders to clearly define their vision for the new strategy, ensuring IT aligns with business goals.
Question
Facing financial struggles, a CEO mandated severe budget cuts. A decision was also made to immediately change the enterprise strategic focus to put more reliance on mobile, cloud, and wireless services in an effort to boost revenue. The IT steering committee has asked the CIO to suggest adjustments to the current IT project portfolio to allow support for the new direction despite fewer funds. What should the CIO advise the committee to do FIRST?
Options
- AAsk business stakeholders to discuss their vision for the new strategy.
- BCancel projects with a net present value (NPV) below a defined threshold.
- CConduct a risk assessment against the potential new services.
- DStart re-allocating budget to projects involving mobile or cloud.
How the community answered
(60 responses)- A65% (39)
- B5% (3)
- C8% (5)
- D22% (13)
Why each option
Given a new strategic focus and budget cuts, the CIO should first advise the committee to engage business stakeholders to clearly define their vision for the new strategy, ensuring IT aligns with business goals.
Before making any portfolio adjustments or reallocations, it is paramount to gain a clear understanding of the business stakeholders' vision for the new strategic direction (mobile, cloud, wireless). This ensures that IT projects and investments will directly support and enable the desired business outcomes, especially crucial when funds are limited and priorities are shifting.
Canceling projects based on NPV is a financial optimization step, but it should happen after understanding the new strategic priorities, as some lower NPV projects might be critical to the new vision.
Conducting a risk assessment is important, but it should follow a clear understanding of the services to be implemented, which is derived from the business vision.
Re-allocating budget immediately without a clear understanding of the business vision for the new services could lead to misaligned investments and wasted resources.
Concept tested: IT-Business strategic alignment and portfolio management
Source: https://learn.microsoft.com/en-us/azure/cloud-adoption-framework/strategy/define-business-outcomes
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