All IT organizations are on the IT Value Journey, just at different stages. By measuring the value of IT, we earn the trust, credibility, and respect from the business that enable us to play a transformational role.
From Break/Fix to Innovation
The IT Value Journey takes us from Maintain mode, where we are primarily doing break/fix, to an Enhance state, where we are keeping up with updates that support the business and, ultimately, to a Transform state where technology innovation drives the business.
We previously discussed the critical importance of measuring IT and driving continuous improvement to navigate the IT Value Journey. Now, we will dive deeper into the strategy to do that.
IT Strategy for the Value Journey
Those who follow the Balanced Scorecard® strategic planning methodology should be familiar with “strategic themes.” These are common sets of objectives that naturally form themes for our strategy. I’ve refined an IT strategy map over the past couple of decades that focused on three themes, based on the IT Value Journey – Maintain, Enhance, and Transform.
Many IT organizations find their strategy weighted toward the Maintain theme, with little activity in the Enhance and Transform themes. Here, we focus on keeping the lights on. Activities are primarily around technical support and infrastructure maintenance, while necessary system and infrastructure enhancements fall behind. It’s common for IT in this state to actually inhibit business growth. The IT leader is often absent from the senior leadership team and IT is not able to measure value.
IT organizations in the Maintain state need to establish baseline measures for customer service, infrastructure and, if possible, software development and maintenance. They can start measuring customer satisfaction versus the cost of delivering services. They can start to measure system/service availability and cyber resilience. And they can partner with business colleagues to determine the revenue gains or cost saving derived from system changes – or bug fixes – versus the cost of the programming to support them.
Relative to this last measure, I once had a client who spent more than two dollars of IT resources for every dollar the business saved from the IT activities. That enabled us to start prioritizing requests based on ROI, which brought attention to the ability to measure the value of IT.
These measures enable us to improve our processes and pave the road from Maintain to Enhance.
If you want to know more about the specific process improvements and metrics, see our contact information, below, and schedule a call. We’ll be happy to share insights.
When we establish baseline measures in the Maintain state and work to improve our processes, we can start shifting resources from Maintain to Enhance. We’re more efficient at the basic maintenance processes and striving for continuous improvement, paying more attention to the system and infrastructure enhancements that bring measurable value to the business. We start participating in value-add projects that leverage technology to improve business outcomes. And we continue to measure the value IT creates, both from improving service at reduce cost and from the ROI on projects we participate in.
In the Enhance state, the business really sees IT creating value. This is where we really earn the trust, credibility, and respect that enable us to play a more strategic role in the business.
As we navigate through the Enhance state, less of our IT budget and resources are in the Maintain theme because we’ve become more efficient and effective at those core activities, freeing up resources to better support the business. At the same time, we have been sharing metrics that demonstrate the value IT is creating. Suddenly, executive leadership understands that IT is not just a cost center but, rather, can really be a strategic asset.
We start dabbling in transformational projects. Those may include a major system upgrade or data analytics that greatly enhance decision making. And we measure the value created by these efforts.
At the same time, we have streamlined the processes in the Maintain and Enhance states and can dedicate more resources to transformational initiatives. This is where continuous improvement is crucial. If we slip, we lose some of that trust, credibility, and respect. So, we must always stay focused on growing more efficient and more effective to earn the privilege of operating in the Transform state.
Our goal in the Transform state is to leverage technology in a way that creates a differentiated customer experience and sustainable competitive advantage for the company.
We showed how we navigate the IT Value Journey by measuring and continuously improving our processes, enabling us to shift resources from Maintain to Enhance to Transform. But it’s not just the process improvements that enable us to navigate the IT Value Journey. It’s really the trust, credibility, and respect that we earn along the way by demonstrating the value created by IT.
Next, we’ll explore the IT Value Creation Process ™ showing eight steps to prove the value created by IT. After that, we’ll move on to embedding technology in the corporate strategy.
We purposefully keep these articles brief and aim to provide high level guidance and trigger ideas. As always, if you want more information or don’t want to wait for the upcoming articles, email Emily Ford at Emily@WolffStrategy.com and she’ll set up a complimentary 30-minute consultation with me.
Larry Wolff is the founder & CEO of Wolff Strategy Partners, a boutique consulting firm specializing in Enterprise Strategy Management, Digital Transformation, IT Leadership, and Executive Coaching. Larry has served as CEO, COO, CIO, Chief Digital Officer, and management consultant for public, private, international, and emerging growth companies. His specialties include corporate and IT strategic planning, technology led business transformation, business and IT turnarounds, merger integration and large-scale project rescues. His methodologies span industries and scale to companies of all sizes.
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