Smart Advice: Wringing More Value From Already Installed Apps
Evaluate systems already installed and consider drafting performance contracts as IT takes the lead in finding ways to improve the bottom line, The Advisory Council says. Also, understand your company's strategic goals before trying to control costs; and approach change management as you would a project.
Question B: Our sales and service operations are on a cost-reduction push. What recommendations should IT bring to the table?
Our advice: Are you looking to lower cost of sales, reduce sales cycles, or improve customer-retention rates? These are disparate goals with possibly conflicting solutions. Whenever a company is looking to control costs, it first needs to have a good understanding of its strategic goals.
There's been lots of hype and press attention on SFA (sales-force automation), CRM (customer-relationship-management) and CEM (customer-experience-management) as the next panaceas to drive down business costs and improve sales and operations cycles. The reality is that these applications are like any other over-hyped IT applications, just a set of tools to help customer-facing staff, not a replacement for them. Automating your customer interactions might be seem cost effective in the short-term, but losing customers because of a poor CRM implementation is unlikely to be your intended objective. Yes, CRM can help you achieve your company's business goals by delivering the appropriate information effectively, but unless management has a good awareness of what information it needs, the tools will fail to deliver the promised savings and improved operations.
There are many available IT applications and tools to help you improve your business processes, but without your insight and decisions, they're ineffective. First, your real corporate objectives must be determined. After that, business processes can be mapped using powerful data analysis and executive dashboard tools that crunch numbers and workflows into meaningful information. Only after the existing processes are well understood can data-analysis tools help identify potential system inefficiencies. Finally, building upon the information from the previous analyses, you can then implement a variety of appropriate IT applications and tools to change and improve processes in alignment with your stated goals.
In summary, IT contributes both tools to identify inefficient processes, and applications to reduce costs. It's important to remember that IT is just a set of business tools to help companies work more efficiently. If the implementations are more expensive than the potential savings, then their utility is limited. Only if you can use your new system to improve your sales and operations processes--by insuring accurate information is available to your sales and operations staff at the correct time--will sales-force-automation, customer-relationship-management, and customer-experience-management be able to deliver on their long-awaited promises.
-- Beth Cohen
Question C: How should we manage change in our IT infrastructure to minimize risk?
Our advice: The change-management process should apply accepted project-management techniques to changes or modifications to any of the IT infrastructure or applications. A good change-management process includes:
Planning: The change-management plan answers the "why, what, where, when, who and how" questions. A well-documented (not necessarily long) rationale, with a plan for implementation, communication, and impact analysis, is essential to the change process. IT organizations should develop a model or template plan to ensure consistency among groups and projects.
Communications: Communication with internal (to IT) and external (within the enterprise) organizations that will be affected by the change is essential. Poor communication is the bane of IT management. Communication plans should be developed based upon impact analysis, and delivered in the most suitable media available.
Categorization Of Changes: Categorization of different types of changes can help in deciding how much caution, communication, management, planning, testing, etc. is appropriate for a change. For example, changes could be categorized as High Risk, Medium Risk, and Low Risk, based on a matrix of evaluation criteria. The categorizations used should be aligned with the dynamics of the business.
Testing: Testing is an essential prerequisite to any change. The nature and amount of testing should be determined during the planning stage, based upon the type of change and impact analysis.
Timing: The best time to apply change depends on the nature of the business, hours of operations, time zones, the expected impact, and risks associated with the change.
Post-Change Monitoring: Monitoring patterns in change-related problems can help the IT organization identify problems with the change-management process itself, so it can be improved.
-- Humayun Beg
Alan Guibord, TAC founder and chairman, has more than 25 years of experience leading IT organizations as CIO with both Fortune 100 companies and small to midsize businesses. Guibord has served as VP and CIO of Fort James Corp., VP of information technology at R.R. Donnelley & Sons, CIO of PictureTel, and VP of MIS and administrative services at Timeplex.
Beth Cohen, TAC Thought Leader, has more than 20 years of experience building strong IT delivery organizations from user and vendor perspectives. Having worked as a technologist for BBN, the company that literally invented the Internet, she not only knows where technology is today but where it's heading in the future.
Humayun Beg, TAC Thought Leader, has more than 18 years of experience in business IT management, technology deployment, and risk management. He has significant experience in all aspects of systems management, software development, and project management, and has held key positions in directing major IT initiatives and projects.
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