Think Business Outcomes, Not IT Value

Posted by Bob Mauro, IT Economist
November 29, 2017

Most CIOs and IT managers realize that in order to be relevant as leaders they must shift from an IT management mindset to a business value perspective. But this is much easier said than done—most IT dollars are spent keeping existing systems up and running instead of innovating to create new business value. 

And despite what some experts say, there is tremendous business value in keeping key systems running properly, but there typically isn’t incremental business value in doing so.  Investing in upgrades to existing systems is important for reducing costs and mitigating risks, but it rarely provides strategic value, for example, by helping the business:

  • Create new product lines
  • Expand into new markets
  • Improve customer experience
  • Shorten time-to-market

In many cases, IT leaders are already providing tremendous value, but they aren’t effectively articulating that value to the business. This usually happens because:

  1. IT leaders are using IT metrics to show value, which business leaders don’t relate to as readily as business metrics.
  2. IT often doesn’t fully understand the metrics the business uses to determine the value of an investment.

However, IT can bridge these gaps by working closely with the business to create a new set of business/IT outcome metrics. The idea isn’t to dismiss all the existing IT metrics but rather to add business outcome metrics, and then revisit the relevance of traditional IT metrics. Here are some project and metric examples:

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Adding these business metrics to the IT lexicon—and working effectively with business leaders—should help shift IT shift its spend from support to innovation.

About Bob Mauro As an IT Economist for ASG, Bob works as a client advocate by developing business cases, building financial models, and creating customized tools to help customers evaluate return on investment (ROI) and other financial considerations. He also offers a broad base of experience in accounting, finance, and business analysis.

Filed Under: IT Economics

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