Simple as ABC, if you dont compete you can't win!

Activity-Based Costing (ABC) is used to identify functional process activities, describe that process in regards to where it fits into the overall business objectives and it’s alignment to goals, mission and company vision. It is a more accurate management system than traditional cost accounting. Although hard to attain because of a lack of standards and metrics, ABC is more valuable because it identifies opportunities to improve business process effectiveness and efficiency by determining the "true" cost of a product or service. The key differentiation and silver bullet is that it must be mapped to corporate performance goals and be used as an initiative generator to fuel top line savings and bottom line growth.

Bottom line; You can’t cost if you don’t measure. If you don’t measure you can’t change. If you don’t change you can’t compete.

Getting more with more. The IT funding quagmire.

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.

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.