The effect of this shift is profound. IT now generates value for the business, rather than just providing a service at the lowest cost, increasing the perceived capability of the CIO and his or her organization. IT is also involved early in the release of new products and services, and changes in strategic direction of the company.
Rather than being brought on board late in the game, and being forced to wedge new business processes into existing systems, IT can ensure the processes and systems will act in harmony.
This saves customization and development time modifying existing applications and creating new ones and provides the ancillary benefit of further reducing IT costs. An increase in value and a reduction in costs—a knockout combination.
Building the Organization
A key component to building a strategic IT shop is establishing the necessary rapport and trust with fellow C-level executives. The second element of this transition is changing your IT shop from a center of technical and engineering competence to a group of business process experts first, and technologists a distant second.
As many technologies have matured, buying technical competence, whether via internal or external resources has grown ever cheaper, causing some CIOs to overload their organizations with pure technicians.
What the strategic IT organization needs is people who are able to quickly grasp a business process, and determine where technology could improve the speed, cost or capacity of the process. These folks then translate this process into technical requirements, which can be farmed to the low-cost internal support organization, or outsourced cost effectively.
At this point, the technology becomes ancillary to the process and IT becomes a center of process and operational excellence—using IT as its “weapon-of-choice” rather than providing a technology-based commodity.
The only caveat is this model hinges on the CIO having the ability to insert themselves into strategic discussions, and his or her employees being seen as valuable contributors to the process, rather than a bunch of tech guys pondering which cool technology should be implemented next.
This transition will not be easy but at the end of the road the rewards are immense. Not only does the IT organization as a whole become a central part of delivering business strategy, but the CIO moves from the ranks of glorified line manager, to a position truly deserving its inclusion in the C-suite.
Patrick Gray is the founder and president of the Prevoyance Group, located in Harrison, NY. Prevoyance Group focuses on providing project performance consulting, which combines project management and process improvement to ensure large IT projects deliver organizational value. Past clients include Gillette, Pitney Bowes, OfficeMax and several other Fortune 500 and 1000 companies.