According to recent research, it is clear that World Class Companies spend more on IT than their peers. To build the case for an increase in IT funding, CIO's need to focus on developing their organization's key strengths . There are six key areas that should be considered:
Product Innovation
Project prioritization
Operational excellence
Brand mastery
Customer intimacy
Business strategy alignment
Aggressively outsource non-core functions.
IT investments should align to one of those disciplines. CIO's need to stop and inventory current practices to avoid wasting money on maintaining functions that are not core competencies. An increasing number of companies are asking third parties to take on tasks such as finance, human resources or indirect purchasing. I don't think there is anyone that can say that the accounts payable function delivers a competitive advantage. Taking out non-productive projects, programs and activities will enable self-funding improvements in the future.
Thursday, November 1, 2007
Getting more with more. The IT funding quagmire.
Wednesday, October 31, 2007
Articulating the business value of IT.
With the plethora of messaging hitting functional process leads from outside the organization, internal providers of IT must develop a strategy to articulate their benefits to their organization. Many of the principles and ideas used in marketing and advertising are adaptable to build a enterprise brand for IT.
Brand development takes into consideration 3 key factors, differentiation, relevancy and consistency. Differentiation allows you to separate, distinguish and defend your services against messaging that is coming into your organization from outside service providers. Relevancy keeps you attuned to what users want and need and at the same time keeps you aware of market trends, and Consistency will give your constituents the guarantee or service level that your offering is competitive, at the very least, superior ideally, in addressing and aligning to their business goals. Today your brand is established by past encounters and service features that have already been delivered. In most cases, some re-branding work needs to be accomplished and should be re-evaluated continually. This is not a bookshelf exercise and should be a living and breathing document that should be evaluated in real time.
The first step in building your brand is an identification of key stakeholders with the intent of getting the understanding of their perception on how they think IT as a service is delivered. Do they see IT as a strategic partner who continually creates new benefits or a roadblock that continues down the same old way without alignment to business strategy? Branding of IT must be aligned to the corporate strategy and corporate goals. It must also reach down into the SG&A functionality and be tied to the activity level if individual contributors with in each department. Every person in every department must have an understanding of how IT adds value to their daily activity. An IT brand will build strength over time, consciously or unconsciously your constituents are branding you. A formal branding approach will put IT in the drivers seat.
Brand development takes into consideration 3 key factors, differentiation, relevancy and consistency. Differentiation allows you to separate, distinguish and defend your services against messaging that is coming into your organization from outside service providers. Relevancy keeps you attuned to what users want and need and at the same time keeps you aware of market trends, and Consistency will give your constituents the guarantee or service level that your offering is competitive, at the very least, superior ideally, in addressing and aligning to their business goals. Today your brand is established by past encounters and service features that have already been delivered. In most cases, some re-branding work needs to be accomplished and should be re-evaluated continually. This is not a bookshelf exercise and should be a living and breathing document that should be evaluated in real time.
The first step in building your brand is an identification of key stakeholders with the intent of getting the understanding of their perception on how they think IT as a service is delivered. Do they see IT as a strategic partner who continually creates new benefits or a roadblock that continues down the same old way without alignment to business strategy? Branding of IT must be aligned to the corporate strategy and corporate goals. It must also reach down into the SG&A functionality and be tied to the activity level if individual contributors with in each department. Every person in every department must have an understanding of how IT adds value to their daily activity. An IT brand will build strength over time, consciously or unconsciously your constituents are branding you. A formal branding approach will put IT in the drivers seat.
Tuesday, October 30, 2007
Business Value through selective sourcing.
In the not too distant past, there were only two sourcing delivery options; in source or outsource. To meet the changing needs and reduce risk, service providers and enterprises have developed an array of choices that better suit the requirements of corporations. In hind site, we have also seen that single-source sourcing is more expensive as solutions are developed that move into niche markets and are aligned to vertical industry functions. This deep expertise offers innovation as part of their service level agreement and delivers increases in efficiency and effectiveness improvements that drives the spirit of the relationship.
Today, I have seen first hand that companies are unwilling to completely dismantle operations and move their people, process and technology offshore with out considering of multiple sourcing choices. Picking, in some cases, multiple delivery options to meet their requirements and business goals. It is also clear that once a process is moved outside the walls, subject matter expertise is required in-house to effectively manage the process and relationship. Governance of multi-sourced relationship is a critical in toady's climate. A strategy, business case and associated action plan must be developed that aligns each choice to how it meets your business requirements and return on investment criteria. Successfully done, these choices will deliver a return on investment and can be used as a growth strategy that delivers to the bottom line.
Today, I have seen first hand that companies are unwilling to completely dismantle operations and move their people, process and technology offshore with out considering of multiple sourcing choices. Picking, in some cases, multiple delivery options to meet their requirements and business goals. It is also clear that once a process is moved outside the walls, subject matter expertise is required in-house to effectively manage the process and relationship. Governance of multi-sourced relationship is a critical in toady's climate. A strategy, business case and associated action plan must be developed that aligns each choice to how it meets your business requirements and return on investment criteria. Successfully done, these choices will deliver a return on investment and can be used as a growth strategy that delivers to the bottom line.
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