Business leaders have embraced IT as a vital part of the organization--one that must be involved in setting business strategy and determining how technology helps make the business run more efficiently.
Talk to most people in IT, and they view their role as vital to business success. Talk to business-unit leaders and company executives, and its a different story.
The non-IT side of the house in far too many organizations still views IT as a cost center. Although many of these businesses are showing a profit and humming along just fine, innovative competitors are turning a bigger profit, improving employee productivity, and better serving their customers.
The reason? The business leaders have embraced IT as a vital part of the organization--one that must be involved in setting business strategy and determining how technology helps make the business run more efficiently.
The line between business and IT already has started to blur among leading, innovative companies. These business leaders understand technology and its promise more than their predecessors, driven by the proliferation of consumer electronics and the rise of the younger, more tech-savvy generation now reaching management positions.
On the flip side, successful IT leaders have a vision of how IT can improve the business--from process changes, to cost savings, to revenue generation, to enhanced employee productivity. Some may argue they always have, but they couldn't get business executives to share that vision.
We're entering a crucial time, though, for IT leaders to shine. As the business and IT worlds merge, successful IT leaders recognize their future depends on shining a spotlight on the role technology must play in developing and executing business strategy.
The path to IT's success must be lined with documented records of success in transforming business through technology.
But why is this happening now? What issues are forefront in this economy that are opening business leaders' eyes to value IT can provide? Several business issues play a role, including:
* Agility—providing employees with access to information and colleagues to help speed decision-making and product development;
* Productivity—providing tools and access to information that speeds the amount of time it takes to complete tasks and/or generate more revenue;
* Energy Efficiency—reducing energy costs within the company, as well as employee fuel consumption from commuting;
* Competitiveness—staying ahead of competitors in terms of cost structure, margins, innovation;
* Quality of life—understanding work/life balances through adoption of flexible work locations (e.g., telecommuting or nearby branch location) or reduction in travel through the use of video, telepresence, or Web conferencing;
* Risk mitigation—ensuring systems and services are enabled for compliance and e-discovery, for today and the future;
* Automation—integrating systems, applications, information, and communications to highlight potential problems or make quick decisions (e.g., electronic health records discovering drug interactions or allergies; inventory systems linking with communications systems to coordinate calls before low-inventory issues arise);
* Customer service—using multiple touch points to interact with customers in a quick, efficient method of choice that results in high levels of satisfaction.
IT's increasing role in business reflects a natural evolution. In the latter half of the 20th century, IT’s primary purpose was automating processes such as accounting, financial transactions, and inventory data. Then, IT moved toward connecting people and systems so they could exchange fairly primitive information.
Now, we're moving into a world where IT directly drives revenue and reduces costs--it can make revenue-generators more effective (e.g., giving field-service workers searchable access to electronic manuals via mobile devices to run more calls per day), and it can make cost-producers more efficient (e.g., tracking energy usage in the data center and reducing utility bills; enabling virtual workplace to reduce facilities costs, etc.).
What's more, the workforce itself is changing. The younger-than-30 crowd will have a profound effect on businesses, particularly as Baby Boomers retire. This group has brains that are wired differently than their more seasoned counterparts.
They didn't grow up playing Kick the Can, or joining a group of neighborhood kids at a field to play baseball or football, or watching The Brady Bunch on TV once a week. Rather, they grew up with computers, the Internet, mobile devices, advanced video games, and text messaging. As these folks move from youth to high school to college and to the workforce, they have a new perspective on how technology should affect business operations and success.
As they move into management positions, regardless of whether they do or don’t have formal IT training, they expect a much tighter bonding between business and IT. Why? Because they understand IT’s potential from first-hand experience.
The business transformation we are witnessing these days almost always has a heavy IT component. It can be tactical and narrowly focused, or strategic and broadly focused.
Tactical transformation typically affects one business unit and addresses a single issue or problem. It changes (or transforms) the way a select group of people operates, generates revenue, or serves customers.
Strategic transformation affects multiple business units and, though it may start by addressing a narrow problem, ultimately affects multiple issues. Ultimately, strategic transformation changes how a company operates, generates revenue, or serves customers.
In the coming months, I will write about the challenges IT leaders face as they try to engage business units and executives. I also will examine specific examples of companies that have successfully transformed IT into a strategic asset. In the meantime, let me know about challenges you’re facing or success stories from your own IT transformation at [email protected].
