This article originally appeared in the May 2014 issue of Smart Business Philadelphia magazine.
Executives miss out on potential competitive advantages when they view information technology projects as a technological initiative rather than an opportunity for business transformation.
“Too often IT is not aligned with business objectives and strategies,” says Sassan S. Hejazi, Ph.D., director of Kreischer Miller’s Technology Solutions group. “Management should think about what role IT can play in helping the company become more innovative and leveraging the intelligence of its data to make better decisions.”
Smart Business spoke with Hejazi about ways IT can add value and improve efficiencies.
Is the problem that IT is seen as a necessary expense to fix problems?
Exactly. There’s nothing wrong with that approach as a starting point. Most IT investments are focused on making processes more efficient, to enable a more lean approach with fewer people touching the same data. That can improve profitability, because you’re running a tighter ship. But that does not result in business growth.
What process should be taken when evaluating an IT project?
The project needs to start from a business point of view. The first step is to determine what strategic goals you are trying to accomplish, such as market expansion, new products, or profitability improvements that could result in improved analytics, cost-cutting or data accuracy. Identify the objective and what technology is needed to achieve those goals. Then assess your current capabilities with people, processes and support to determine what you will need to close the gap. That will define an IT project that is closely linked with business objectives and the goals you want to accomplish. Also, be sure to measure your progress against the goals. Success in business is defined by using the right tools — in this case IT — to achieve your goals.
Many executives are intimidated by IT and shy away from asking the hard questions. However, by asking about key business drivers and how IT can achieve stated goals, IT can understand business capability issues and translate the technological capabilities into an overall business perspective. Otherwise, it just becomes a technology-driven project, with little likelihood of providing any substantial business improvements or advantages.
What advantages can be gained?
Many companies have accumulated years of data in their information systems and a business analytics or dashboard project can help them analyze and present the data in a useful way in support of their market expansion or new product introduction decisions. Off-the-shelf dashboard and analysis tools cost a fraction of what they did five years ago. Choosing the right tool and setting up the proper dashboards with applicable business processes can reap many benefits for management.
How can an IT audit help?
IT is a very broad field and middle market companies cannot always have all the resources and technology tools they need. As such, they need to create an ecosystem of capable solution partners, each specializing in a key area such as financials systems, IT security and connectivity, in order to ensure an acceptable level of IT effectiveness. An IT audit will examine overall information systems capabilities and identify risks related to people, processes and technologies.
An IT audit will also reveal potential vulnerabilities, whether they lie in business applications, the company’s use of social media, networks, or control and compliance issues. An audit also helps with planning budgets for various IT initiatives so the company can leverage best practices across the organization.
The outcome of the audit is a solution road map that highlights potential areas of improvement. It is a great tool to devise a game plan and set priorities for projects with a quantifiable benefit to the business. Audits can be performed on an annual basis and then reviewed, validated and tweaked as part of a quarterly process in conjunction with the organization’s overall planning process.
Instead of looking at IT as a cost, consider it an investment to enable you to grow your business, create new products and services and explore new markets. That’s the best way to achieve a high ROI from IT investments over the long haul. ●