Differentiate between business strategy and IT strategy

Your organisation probably already has an IT strategy in place. But what about a digital strategy? “What’s the difference?” I hear you ask. Good question. In this article, we’ll define both strategies and examine four methods for distinguishing between the two. In the process, we’ll help you arrive at a better understanding of how digital and IT strategies can benefit your organisation.

In this article...

• What Is the Difference Between IT Strategy and Digital Strategy?
• Four Ways of Distinguishing Between Digital and IT Strategies
• 1. Content vs Technology Strategy
• 2. Proactive Approach vs Reactive Approach
• 3. Technology that Transforms vs Transforming Technology
• 4. Digital Strategy vs. The Rest
• The Strategy Paradigm Shift

What Is the Difference Between IT Strategy and Digital Strategy?

As with many relatively new technical terms, there is some debate as to how we define both IT strategy and digital strategy. This is largely due to the flexible way they’re applied and the fact that there’s often considerable overlap between them.

Both terms have distinct meanings depending on who you talk to, and their definitions are evolving as our concept of what digital is and what it’s capable of changes.

That said, it is possible to broadly define these strategies. Below, we’ve also included a definition of business strategy for context, reference and comparison.

• Business Strategy – the long-term plan that details how a business intends to achieve its overall aims

• IT Strategy – An older term for the long-term plan that details how a business intends to use Information Technologies to implement its business strategy. As a concept, IT strategy was popularised early in the digital revolution, before modern digital infrastructure was widespread and before we fully understood how radically it would impact the business landscape. As such, it’s often thought of as subservient to business strategy and situated within a one-way conversation with business strategy. Business strategy defines and directs IT strategy but not vice versa

• Digital Strategy – A more modern term for the long-term plan that details how a business intends to digital technologies to further its overall aims. Coined later than IT strategy, it offers a broader perspective on the role these technologies have to play in defining and implementing business strategy. Unlike IT strategy, it operates within a two-way discourse with business strategy. Digital strategy can influence and direct business strategy and vice versa.

Does that make everything clearer? Don’t worry if not. Below we take a look at four common means of distinguishing between Digital and IT strategies.

Four Ways of Distinguishing Between Digital and IT Strategies

1. Content vs Technology Strategy

One of the most convincing descriptions of the distinction between digital and IT is that digital is concerned with the content distributed through technological channels and that IT deals with the hardware that facilitates the distribution.

In this sense, we often summarise digital strategy as a ‘proxy for website content, e-commerce, social media, mobile and email marketing; the driver being a shift from channel to content.’ (Forbes).

As a result, the digital vs IT debate becomes a simple matter of content vs hardware.

However, this distinction isn’t entirely in keeping with the way the terms are frequently used. For instance, the deployment of cloud technology is often mentioned in modern digital strategies, yet it clearly has both content and hardware-based applications.

This is a perfect example of how the two strategies regularly overlap and how organisations often have to choose whether a particular technology falls under digital or IT strategy.

2. Proactive Approach vs Reactive Approach

Another way of explaining the difference between digital strategy and IT strategy is that the former concerns a ‘business answer to a digital question’ (Gartner). The latter is a technological answer to a business question. This is more in keeping with the definitions established at the start of this article.

In other words, digital strategy should be considered an integral part of a company’s business strategy. It is not distinct from the business’ overall strategy but it is a specific perspective on it. On the other hand, IT strategy considers the way technology can be used to meet the needs of the business strategy, without influencing it.

The first is a proactive means of determining the direction in which an organisation heads. It engages in a wider discussion about how technology affects business strategy. The second is reactive. It responds to business strategy and focuses on using technology to resolve questions and issues posed by that strategy.

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3. Technology that Transforms vs Transforming Technology

There is a third way of defining both of our core concepts. This distinction treats technology as something that can be changed or altered in isolation, without affecting overall strategy. This is the distinction that comes closest to our original definitions.

It is best explained in the following way:

• Digital strategy examines the ways technology can be leveraged to transform practices, processes and procedures within an organisation – changing the business strategy as it does so
• IT strategy looks to change, fix, or improve technology without impacting on an organisation’s business strategy

4. Digital Strategy vs. The Rest

Some organisations have decided that it’s best to clearly define their digital strategy first. Anything else technologically-related but that doesn’t fall into this category, is then included in their IT strategy.

This clearly prioritises digital strategy over IT strategy, essentially treating the latter as a “catch-all” concept that handles anything technology related that hasn’t found its way into the digital strategy. While this may be a practical way of approaching the issue, it offers no clear definition for either concept.

Read our article on How to Implement a Digital Transformation Strategy »

The Strategy Paradigm Shift

As we’ve seen above, an argument (or four) can be made that there are substantial differences between an organisation’s digital strategy and its IT strategy.

However, with so little clarity surrounding the issue, it’s largely up to individual organisations to define what falls into either category.

That’s not to say that there isn’t a distinction. Two additional factors should be taken into consideration when thinking about the difference between digital and IT.

They are:

• The distinction is contextual – The way an organisation distinguishes between IT and digital (and whether they do) is dependent on the industry in which they operate and the work they carry out. For instance, a digital marketing business is likely to have a far more expansive concept of digital strategy than a construction firm

• We are in the middle of a paradigm shift – When organisations were first beginning to adopt digital technology, a smaller, simpler strategy was all that was necessary. This was the IT strategy. As the extent to which digital technology has impacted commerce and local government service provision has become apparent, a more complex and all-encompassing strategy became necessary. Consequently, broader digital strategies began to be developed and adopted by organisations

Currently, we’re in a transition period – organisations still utilise the vocabulary and organisational structure of the ‘IT era’ but also understand that a greater reliance on digital technology has far-reaching consequences that go beyond the scope of previous strategies. This has forced us to introduce new ideas, concepts, and terminology to meet the needs of modern consumers. And these have coalesced into contemporary digital strategy.

What Next?

As there is no clearly defined difference between IT strategy and digital strategy, it is largely up to your organisation to decide how it wants to differentiate between the two. This is no bad thing. In fact, it gives you greater flexibility to build strategy in a way that suits your operations.

We would recommend working together with experts in the field to develop a clear concept of how separate digital and IT strategies can affect your business and how they can be deployed to improve performance. More importantly, digital specialists will also be able to help you communicate the difference between strategies to staff, ensuring they understand why changes are being made and why the adoption of a new digital strategy is of the utmost importance.

Our team has been supporting organisations with digital transformation for over 30 years. Call us on 01344 595800 or drop us a line to find out more.

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