Organizations spend large sums on IT but are often left wondering if they get any returns on these investments. IT is seen as essential to transforming organizations but too often just consumes funds without meeting expectations.
Technology projects rarely deliver on their initial promise. Even successful projects often fail to deliver the full value expected. This is so common that many organizations are leery of taking on significant efforts with major costs. Yet if we do not apply technology to improve our organizations, how can we meet the demands of today’s straitened fiscal environment?
As a report by McKinsey and Company (2013) confirms, many of the challenges documented are less about technological failures. Often failures result from poor governance and management; inflated and unreal expectations about technology and what it can do; unrealistic timeframes for project delivery and benefit realization; and the shortage of and poor allocation of financial, human and technological resources, among other non-technology reasons.
It is these challenges which prompted the research work of Dr. Gerald Grant of Carleton University’s Sprott School of Business. This broad academic and strong theoretical approach is balanced by the real world experience of Rob Collins, former Chief Information Officer in both public and private sectors and 30 years’ experience in the high tech industry.
Their work, described in the book The Value Imperative: Harvesting Value From Your IT Initiatives, shows how the basic model for managing technology is fundamentally flawed. There are two major problems that conspire to deny success to technology projects. The first is an engineering model which is flawed from the very beginning. This model focuses on the project instead of the value the project is supposed to deliver. As well, it denies the realities of change that affect every effort.
Secondly, the delivery of projects is too often considered the responsibility of the IT department when the delivery of value is almost always in the hands of other parts of the organization. This failure of IT/Business alignment has been the dominant topics of CIO Conferences and industry analysts for nearly two decades.
The fundamental engineering paradigm needs to be replaced with a model more accommodating of change and sensitive to the realities of organizations. Change is not only a fact, it is the desire for change that warrants investing in IT. Change must be managed, not treated as error. A model more akin to agriculture, with a focus on the harvest and a weather eye to change is far more likely to produce successful results than an inflexible engineering model.
Along with a new model to view investment and value, there needs to be a shared responsibility between user and technology organizations. The delivery of value can only be the focus when the people who deliver that value on a day-to-day basis share both the authority and responsibility with the people who must implement the technology.
The focus must be on users achieving value, not just IT meeting a schedule. This requires a common set of tools and language to bridge the gap between these organizations.
The Value Imperative Seminar
Building on the book, the Value Imperative Seminar guides attendees through new models for approaching investments in Information Technology. Topics include
- The Value Cycle
- How organizations define value around their primary stakeholder(s)
- The Value Realization Cycle
- How IT investments become organizational value
- The Agricultural Model
- A new way to look at technology investments
- Communication Tools
- Return On Investment (ROI)
- Value Audits
CIOs and Senior IT Executives
CIOs are under pressure to:
- Create real and lasting alignment with the rest of the organizations
- Focus on efforts that produce real value for the customers, shareholders, donors and/or taxpayers
- Have demonstrable proof of IT’s contribution in metrics that make sense outside of IT
- Engage the organization and make the hard decisions
- Eliminate the churn of constant plan and priority changes
CFOs and Financial Leaders
CFOs want to:
- Identify measurable value for all investments in IT and all ongoing costs for technology
- Be able to make investment decisions comparing various IT and non-IT options
- Tie IT investments to organizational strategy
- Kill projects early if they are not going to deliver as expected
Real value is created by the lines-of-business that apply the technology delivered by IT. Leaders in these areas need:
- Predictable results from IT allowing firm business plans to be made
- Technology that delivers real value tied to organizational strategy and goals
- Clear and consistent process to define IT’s goals and contributions
- Fewer failures
- Fewer surprises
More and more, internal and external auditors are being called upon to review investments in IT with an eye to explaining what real value was delivered and what the real cost was. Currently, there is no agreed-upon guideline or standard for this. Our work can provide this basis for Auditors.
Finding a Seminar
Seminars are scheduled regularly at the Sprott School of Business in Ottawa, Ontario, Canada. Attendees are encouraged to bring a real-world challenge from their organization with them to discuss as part of the seminar. It is most effective when two (or more) people, one from IT and another from a part of the organization expecting to see value from IT investments, attended together.
See a list of upcoming seminars.
Organizations can arrange for customized seminars to be delivered at their place of business. As well as covering the material outlined above, the seminar can be tailored to address new processes to focus on realizing value from IT investments or serve as a forum in which to develop a new approach to IT investment.
Contact us to inquire about a seminar for your organization
About the Authors
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