CIO 009 I.T. CAN add Value Created by James on 6/13/2013 3:53:23 PM
There is increasing skepticism about the value of information technology to business and the magnitude of I.T. project failures is increasing.
At a recent conference it was stated that the I.T. industry was "in crisis" and that student registrations were declining.
So -- can I.T. add value?
In my experience YES.
In fact, I am so passionate about this that I have devoted much of the last 18 years to seeking to develop methods for ensuring that I.T. projects and I.T. investments generally, deliver material value.
My benchmark of an I.T. project that created value is a system that enabled the client organization to double turnover in one year and supported a sustained income stream for ten years.
Another project opened the door for the client organization to secure a rich harvest of management information, win a major new contract and do the work with four clerks where twelve would previously have been required, yet head count reduction was not planned.
Appropriate, well implemented information technology applications can add substantial value, sometimes they can add dramatic value.
I.T. solutions can be delivered successfully, economically and in realistic time frames.
Doing it right is cheaper than doing it wrong and doing it wrong is always more expensive than the client organization can afford.
So why the carnage?
Part of the problem is that client organizations do not generally talk about the lack of performance of their I.T. investments. It is not good politics to admit that a project has failed to deliver business value that covers the real cost of the investment.
I regularly run courses on the causes of failure and how to achieve successful outcomes and these courses are regularly attended by representatives of large organizations who, off the record, admit to huge frustration with mega projects that they regard as failures or near failures.
An essential ingredient that is frequently missing from the I.T. projects that I assess in advising clients whether they can be salvaged and remediated is an absence of "strategic alignment".
What do I mean by this?
Strategy is not mystical mumbo-jumbo as many seem to think, strategy is a concise definition of "the essence of why the organization exists and how it thrives".
A first approximation of strategy can frequently be gained by interviewing executives and asking them "what is the essence of why this organization is successful?" The problem is that frequently this question has never previously been asked let alone answered and the answer, if formally known, has seldom been communicated to the rest of the business let alone the software service provider. It is therefore seldom the definitive criterion for success of an I.T. project.
The reality about strategy is that it is frequently an intuitive gut response of the founders of the organization to the real needs of the market place and it is frequently so obvious that nobody thinks to communicate it. Yet somehow it is frequently missed by those running major I.T. projects.
Successful, high value outcomes at value appropriate cost can be achieved by defining the essential strategic driver of the organization and ensuring that this is entrenched in every aspect of the project.
Another key requirement for success is executive custody – a fundamental choice of ownership and state of mind on the part of executives that says “this is my system and I will do what it takes to make it work”.
If these two factors are present coupled with the other critical factors for success that I have discussed in past issues then I.T. WILL add value.
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