Creating that environment requires giving employees authority to suggest ideas and management taking those suggestions seriously, he says.
"That is hard for a lot of organizations. It comes down to culture."
At Philips, which has IT operations in more than 600 locations in 60 countries, a revamp of its business processes is leading to a culture where IT and business work in synch.
Having IT more in tune with the business is part of a multiyear project that aims to streamline the steps that Philips uses to bring products and services to market and improve its performance on Wall Street. A more flexible company, and IT department, can give Philips market insight not found by using enterprise software, says Deputy CIO Joe Norton.
"We're all buying from Oracle, from SAP, from Microsoft," he says. "What's the competitive advantage? There is none. The competitive advantage is all about information acquisition."
Obtaining and using that information to develop the right products for when markets need them is the future of Philips and its IT department, Norton says.
To develop its future IT platforms, Philips is using agile software development, a key component of which is working in interdepartmental teams. To help employees understand how agile software development would connect business and IT, all Philips workers received training in agile methodologies, Norton says.
Additionally, Philips uses webcasts, workshops, newsletters and panel discussions to explain the company's focus and how departments are interconnected.
"You have to look at this as a massive organization change," Norton says. "It's just not for IT. It's more the entire company. We're not doing this alone."
For companies that aren't following an agile development path, Modis' Cullen recommends a similar form of collaboration with representatives from IT and business attending their respective department's strategic meetings.
"By having that cross pollination you're developing a cohesive business unit," he says. This avoids the departmental rift that develops when IT is eager to use the latest technology without considering if it solves the business' problems, he adds.
Having IT workers versed in the company's business is crucial for Philips' future IT leaders, who will not come strictly from the ranks of software developers or database administrators.
"They're going to be business technologists who review how we go to the marketplace," Norton says. These employees will understand how IT can facilitate getting products to market across all levels of the company, as well as work with suppliers.
IT departments are smart to place the business' needs first given that most CIOs report to the CEO or COO, Cullen says.
"If you look at where technology is in the pecking order it's very wise that people have the mindset that we can't lead with technology," he says. "We have to lead with the understanding of the business issue, provide a business solution and show how IT can enable that."
Mercy, whose 32 hospitals treat more than 3 million patients annually, hired Gil Hoffman as CIO in October to better align the organization's IT with its business needs.
"When they recruited me, there was a real interest in trying to get more business knowledge instead of just technology knowledge into the IT organization," says Hoffman, who previously handled that task as the CIO of a marketing services company.