In September, Ventana Research conducted a workshop for senior finance executives as part of CFO Magazine’s Strategy Execution Conference. Its theme was integrating business and information technology, particularly in areas where the proper application of IT would have the greatest potential for creating business value (including budgeting and planning, closing, reporting, compliance and profitability management). We also delivered an overview of the methodology we use to help companies create requirements for IT initiatives and find the software that best matches their needs. Part of the workshop was devoted to discussing the most common IT issues that participants had to confront to address the business challenges facing them. We found that the pure technology concerns were dwarfed by a broader set of challenges related to the organization, communications and resources.
The results of canvassing our CFO workshop participants demonstrated again that from a business perspective, the greatest IT challenges have less to do with technology than with people and organizational issues. Communications concerns were cited most frequently. Some participants declared that IT’s lack of understanding of business issues and strategic requirements was a barrier, while others cited IT’s failure to listen to users’ needs. Recognizing that the problem cuts both ways, others mentioned a lack of clarity on the part of users in defining their requirements and a general inability to communicate clearly, possibly because (as others noted) different groups use different definitions. Cultural barriers also were mentioned. None of this was particularly surprising; Ventana Research often finds that fixing what appear to be technical problems begins with engaging all participants in a meaningful discussion.
Organizational issues were the second most frequently mentioned item. Perhaps because of a lack of effective dialogue and a track record of poorly executed projects, many people do not see the value of investments in IT and question whether IT departments can deliver. One participant mentioned a lack of buy-in from IT, which can happen when an initiative driven by a line of business excludes IT. Process management concerns, including scope creep, also made the list, as did corporate politics. Overall, organizational issues appear to be a constant impediment, but usually they can be mitigated by preparation and communication. On the other hand, an IT department that has a poor reputation within the company has to reverse that perception before anything else is possible. (When you find yourself in a hole, the first step, as the epigram advises, is to stop digging.)
Resources were another familiar stumbling block. Over the past three years, organizations have had more opportunities to invest in IT-related projects than they have had funds earmarked for capital spending. Many companies pared the size of their IT staffs considerably and now do not have the human resources to support needed initiatives. In midsize organizations, being able to attract and retain people with the necessary IT skills always has been and continues to be a challenge.
Of course, our conference attendees also mentioned plenty of technology issues. They deal with disparate systems that are difficult to integrate, poorly designed data warehouses (or no data stores at all), systems that cannot scale to their requirements, poor data definitions and data quality and difficulty in getting useful information from their IT systems into reports. They also struggle with basic architecture issues such as ensuring flexibility and with build-versus-buy decisions.
Information technology is a big headache for companies of all sizes. They find it difficult to manage the acquisition, implementation, use and maintenance of their IT systems. Ventana Research consistently finds, though, that “IT issues” go well beyond purely technical concerns and always touch on people and processes. Companies continue to struggle with information technology because they lack internal resources and a methodology capable of assessing the adequacy of their IT architecture and environment, as well as the organizational and process issues that accompany them. They also have a hard time finding a trusted advisor to help them address these issues in the ways that mean the most to them.
About Ventana Research
Ventana Research is the leading Performance Management research and advisory services firm. By providing expert insight and detailed guidance, Ventana Research helps clients operate their companies more efficiently and effectively. These business improvements are delivered through a top-down approach that connects people, process, information and technology. What makes Ventana Research different from other analyst firms is a focus on Performance Management for finance, operations and IT. This focus, plus research as a foundation and reach into a community of over two million corporate executives through extensive media partnerships, allows Ventana Research to deliver a high-value, low-risk method for achieving optimal business performance. To learn how Ventana Research Performance Management workshops, assessments and advisory services can impact your bottom line, visit www.ventanaresearch.com.
© 2005 Ventana Research