Slashdot Mirror
Managing IT As An Investment
For far too long, the authors argue, IT has been incorrectly viewed as a separate part of the enterprise; a distant silo, relegated to the status of a âoecost center.â Instead, the authors make the case for transforming IT into a âoevalue centerâ â" a mission-critical member of the business enterprise, managed as a strategic asset.
In order to get there -â" and to maximize IT value -â" the authors say organizations must realize that âoeIT is inseparable from the business and requires complete alignment with business goals.â Then, they have to admit that thereâ(TM)s âoeno such thing as an IT project.â
âoeIT is no longer a cost center and a growing number of highly successful firms are recognizing this,â the authors say. âoeIT is an investment and should be managed as such to increase revenue and profits. No matter what size project, IT is a member of the business team and should be accountable and responsible.â
Getting past old-world ways of thinking can be difficult for business and IT-minded folks alike; such transformations are often riddled with unexpected organizational change management issues. Moskowitz and Kern do a nice job of exploring some of these difficulties at a high level, but leave plenty of room for in-depth exploration by other authors.
They introduce readers to âoeConsequence-Based Thinkingâ in Chapter 2, a concept that promotes decision-making based on desired business results, rather than on the IT problems you face. The authors explore ways you can avoid âoethe Right/Wrong trapâ (situations in which humans forfeit the desired consequences for the privilege of being right), develop jointly produced business cases (âoea technology case is not sufficientâ), and help each department in your organization contribute to the success of the enterprise mission.
In Chapter Three, âoePartnering,â the authors illustrate the importance of creating a team that will support the goals of the enterprise. âoeIt is key that members of IT teams see themselves and their work as core to the business itself, and not view the IT function as an appendage of the business.â As this happens, the authors say, âoeothers will view them (IT) as critical and necessary partners that can be trusted to provide solutions that donâ(TM)t merely serve a process, but truly serve business outcomes.â
Business partners must change the way they think of themselves as well. Business must think of itself as âoea partner with, rather than a customer of IT,â the authors say. They recommend the development of formalized contracts that spell out responsibility and accountability for all involved; a âoecommon vocabularyâ (to help get everyone in your organization, regardless of role, on the same page); and provide words to the wise for management: âoemanagers will never have as much information as people on the front line.â
Sizeable emphasis is placed on the importance of jointly developed business cases, which the authors say, âoeforces IT and business to engage in continuous dialog in order to ensure success.â Jointly developed business cases can help align IT with business objectives, and have the additional benefit of âoemoving the business agenda forward and creating partnerships and understanding.â A sample Business Case template is provided as an appendix.
Chapter Five, âoeStrategyâ makes the case for building a big-picture strategy that âoestresses an enterprise point of view over seat-of-the-pants, silo thinking.â Organizations without an enterprise strategy often end up creating what the authors call âoeislands of automationâ that will later need to be integrated.
Strategic thinking is a skill and not something that comes easily. It involves adopting new processes and changing the way we think about our jobs. By adopting a âoeBusiness Strategy Formation Processâ that relates an enterprise-to-an-individual and an individual-to-an-enterprise, the authors say organizations can make âoeconsistent decisions that incorporate foresight.â
Chapter Six, âoeThe Small Picture,â provides guidance on communicating the âoebig pictureâ to âoesmall pictureâ folks by answering the question: âoeWhatâ(TM)s in it for me?â Chapter Seven discusses ideas for setting up and managing IT departments as âoevalue centersâ while Chapter Eight, âoeHuman Capital Managementâ deals with issues of people management, individualism, and job satisfaction.
Chapter Nine, âoeInvesting In Values,â provides a brief overview of the importance of values, which the authors define as the âoeguiding principles and basic beliefs that are fundamental assumptions on which subsequent actions are based.â The authors provide several models to help you make which value decisions. They also discuss how to reap âoethe hidden harvestââ"the rewards delivered through collaborating with others toward a common, understood and measurable goal, benefits not realized through traditional, inside-the-box thinking.
While Managing IT as an Investment is indeed a value-added resource, reading the book is not enough. Youâ(TM)ll need to do a little homework before you go tackling a major change in your organization. Youâ(TM)ll need additional guidance not provided in the book to help you decide whether your IT and business staffs should work in the same physical space to help reduce communication barriers and establish a sense of âoeteamâ; if you should re-organize your management structure so both IT and business team members report to the same manager; how you should communicate information about your project in order to create project evangelists; and whether your reward structure needs some revamping (is IT currently rewarded for âoeon timeâ delivery as opposed to delivery of quality solutions that deliver the highest return on investment possible?).
Despite these weaknesses, Managing IT as an Investment: Partnering for Success is an excellent addition to both business and IT literature. At only 150+ pages â" 10 chapters, followed by 4 value-added appendices â" you can read the entire book in an afternoon. The book is well worth the effort. Includes case study information and references to other published works. Perfect for those involved in paradigm-shifting projects where strengthening the relationship between IT and business can help ensure success.
Scott Abel is a content management strategist. Look for his column, The Content Wrangler, on ePrairie.com. You can purchase the Managing IT As An Investment: Partnering for Success from bn.com. Slashdot welcomes readers' book reviews -- to see your own review here, read the book review guidelines, then visit the submission page.
BN can't find the book -- Link to amazon
The ISBN is 013009627X
If you blog it...
Nicholas Carr, writing in a recent Harvard Business Review article, probably wouldn't agree with Moskowitz and Kern.
Man, I just got back from Philadelphia for business and I cannot tell you how much businessspeak and cliche's I heard. Reading this post was like a flashback with phrases like "Partnering for Success" and "cost center" and "consequence based thinking". I can't tell you how sick I get from hearing folks spout off tripe like "world class" etc... And most commonly I hear this stuff from folks that are absolute knuckleheads, but they have mastered the businessspeak vocabulary so they sound good to people who are not looking for real meaning.
I know all businesses are not like this, but what is wrong with simply working hard and producing your product with craft and skill and not resorting to all sorts of "strategies for success"?
Visit Jonesblog and say hello.
...look at IT as a cost center (a liability, an expense) and never as an investment. You'll never be able to convince them that IT infrastructure is like the bolts that hold the wings onto the aircraft they're flying. I've been trying for 15 years and 4 different companies and it's just an exercise in futility.
IT is often looked at with a frown because of what it tends to be in most organizations: a very expensive division whose responsibility is to provide critical tools to perform business, with the ultimate goal being to produce a result, typically profit. Unfortunately, there are plenty of decision-makers who don't think far enough to recongnize the link from tool to result. Sales is seen to generate revenue. Marketing is seen to create and position the products for sale. Finance bills and spends. IT ties those pieces to one another and allows them to function, but you have to think creatively to draw a line from revenue to IT spending.
Now that I think about it, I wonder how many parallels you could draw between HR and IT. HR is the machine that provides people and benefits to those people, without which the company ceases to function. In a more abstract sense people are tools (whoa), and HR can certainly be viewed as a cash drain with no direct revenue...
So long, michael. Don't let the door hit you...
Over time, and working with places that (frankly) spent far too much fscking money on useless crap, I've boiled down IT to three things:
1. We provide access to data to those who need it.
2. We deny access to data to those who do not need it.
3. We increase the efficiency of access to the data in compliance with rules 1 and 2.
That's it. Now, I'm not saying computers shouldn't be used for entertainment, etc - but in the workplace, those are the 3 things that IT should be focusing on.
When I recieved requests for "Well, we need a bigger computer here!", I bring up the three rules above. Does it increase access to the data that much better? Would another alternative work?
It's not about being "cheap" - sometimes you have to spend money to do things. But an IT staff should be going out to their customers (aka - the business they work for) and saying "All right, what do you need access to. What do you do in your day? Do you fill out the same data over and over again? What can we automate for you so you're spending more time on things the computer can be dealing with? Is there a way to give you better access to your information without compromising security?"
The more you involve users (and their managers) in the Three Rules of IT, the more they come to see IT as an asset - not just an expenditure.
In the end, I consider IT to be the janitors of data. They don't make the crap - but if they weren't there to keep it neat and clean and organized, the business would go to shit in a real hurry.
That's just my view - I know, I could be wrong about it. But it's served me pretty well.
52 Weeks, 52 Religions with John Hummel
I think we'll reach a point where IT workers will be free to flourish in businesses and achieve their goals (to become real programmers).
You're missing the critical point here. The goals of the programmers and IT as a whole need to be closely aligned with the business, not with some idea of being a "real programmer" (whatever that means). It's not about getting the PHB's to leave the nerds alone - it's about the nerds coming out of their shell and understanding exactly how business needs and technical solutions come together.
Stop by my site where I write about ERP systems & more