We believe that: To deliver business value with IT we need to Focus on the Business Bottom Line that is: How fast can we get our products and services to market “Time to Market” & how can the IT department support the business from a Cycle Time and Cost Effectiveness perspective.
That is In order to avoid the “do we really need a CIO and IT department to bother us with technology when we can use the cloud?” the CIO has to ensure that the business strategy and business objectives are supported by IT (from a Business and IT architecture perspective). Where the IT Strategy support Strategy execution, “Time to Market”, Cost Effectiveness and stakeholder expectations from an Executive, Business Unit, IT Management and IT Risk Management perspective.
We have identified 2 key trends for the CIO to focus on: – Differentiation (That is, how does IT provide a competitive advantage for the business), and – Cost (How does the IT Department deliver IT Services cost effectively). To do so we need to Build an effective IT Delivery Model to meet business needs and expectations as we leverage business strategy execution and business processes supported by an IT Service strategy (ITIL, IT – CMF, CobIT 5 (ValIT, CobIT 4.1, RiskIT), ISO 38 500, TOGAF and ISO 9001, ISO 27 001, COSO) delivered in a Business IT roadmap; that is how do we support business objectives and processes leveraged by IT and an effective IT Services strategy. Within this scope we would by definition address how we execute the IT Strategy:
– Design: – Spell out IT Activities from a demand and supplier side,
– Build: – Set IT processes and key performance indicators,
– Run: – Aligned to described ITIL activities and processes where we build effective IT Financial Management to figure out the actual cost of delivered IT services and follow up on IT chargeback over time.
Once services defined we can then decide where to run the application that support the IT and or Business Services (server / internal / external cloud/outsourced provider).
The CIO and the IT Department need to position as premium provider of IT services and focus on value to cost. In order to avoid the “do we really need a CIO and IT department to bother us with technology when we can use the cloud?” the CIO has to ensure that the business strategy and business objectives are supported by IT (from a Business and IT Architecture perspective). Where the IT Strategy support Business Strategy execution, “Time to Market”, Cost Effectiveness and Stakeholder Expectations from an Executive, Business Unit, IT Management and IT Risk Management perspective.
In order for the CIO and the IT Department to position as premium provider of IT services and focus on value to cost we need to understand the Business (IT) Strategy and how the IT department can deliver effectively to business objectives, that is to deliver business value with IT:
– What is the Business’s strategy and plans?
– What is the current business model that IT has to support?
– Where could IT make a significant impact on the business?
– Are there any further opportunities to use IT?
Within the frame of an acquisition 80% of the value realisation is (can be) on the IT side. The failure to address IT and the IT strategy can be an additional reason to M & A failure.
If we assume that to deliver business value with IT we need to support business objectives, the integration of a new entity is an optimisation of the current IT strategy (how we support business objectives and processes). We would obviously need to understand (and hopefully have the opportunity) how the current IT run before the purchase (IT due diligence) with full IT Financial Management to figure out the actual cost of delivered IT services (cost, consumption, chargeback). Once services defined we can then decide where to run the applications that support the IT and or Business Service (server / internal / external cloud / outsourced provider).
We also need to define the purpose of the purchase (invest / divest) in the overall corporate strategy where it is of little use and a significant cost to integrate all systems in to a common backbone if the company is to be divested only a few years later. We could use a an IT Scorecard to ensure that stakeholder expectations are met from an executive, business line, IT and IT risk perspective.”