cio value issue
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TRANSCRIPT
04/10/23 Peer Consulting GroupJim Sutter
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It Helps if You’re Good at This
Help Grow the Business More with Less Help the Business be more Efficient Provide Analytic Insight Add Value …
04/10/23 Peer Consulting GroupJim Sutter
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“Signs of major technological improvements are all around us…..
The benefits are evident…in the production processes that have long been part of our industrial economy.”
Alan Greenspan Former Federal Reserve Chairman
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All Corporate functions are under cost pressures.
Some corporate functions are examining outsourcing.
Many corporate functions are told to do more with less.
Most corporate investments must have a solid ROI.
Should IT be different?
04/10/23 Peer Consulting GroupJim Sutter
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IT users vary on real needs. Most departments are reluctant to
commit to hard savings. Integrated applications imply benefits
from the whole – not one department. Infrastructure is not always ROI-able.
04/10/23 Peer Consulting GroupJim Sutter
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CEO/COO/CFO look for ROI.
Other opportunities vie for the investment.
Cost for IT should not outpace revenue growth.
What do others spend?
CSO/CIO worry about falling behind the competition.
How do we support sales/business growth without upgrading the infrastructure?
Constant pressure from customers.
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IT Investments - Who gets to say? Who takes the lead? Who commits?
What if its hard to Quantify?
Is everything measurable?
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Systems Strategy Services –Data, Network, Desktop
Software Delivery
CEO, Mgt Committee
High Priority
Partnership
Common Objective
Cost Effectiveness
Secure
Competitive
Minimum Function
Management and Supervision
Competing Objectives
Differing Priorities
Resource Allocation Optimized for their area
Associates and Individual contributors
Indifference
Cynical
Performance
Reliability
Ease of Use
Maximum Function
04/10/23 Peer Consulting GroupJim Sutter
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Systems Strategy Services –Data, Network, Desktop
Software Delivery
CEO, Mgt Committee
Co-develop
Support for initiatives
Synchronize objectives
Provide metrics
Obtain best in class
data
Report progress
Contrast competitors
Management and Supervision
Protect partisan objectives
Balance enterprise vs.
departmental flexibility
Calculate cost Per seat
Calculate cost per call
Deliver to schedule
Work to maintain leading edge
Associates and Individual contributors
Keep user groups informed
Demand QOS
Monitor SLA s
Press for robust infrastructure
Thorough training
Stabilized environment
04/10/23 Peer Consulting GroupJim Sutter
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IT Investments - Who gets to say? Who takes the lead? Who commits?
What if its hard to Quantify?
Is everything measurable?
04/10/23 Peer Consulting GroupJim Sutter
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04/10/23 Peer Consulting GroupJim Sutter
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Gartner Group lists as one of the most durable challenges for CIOs.
Harvard Business School article, “Does IT Matter”.
SIM highlights value issue at its recent conference
Information Week, CIO Magazine surveys
04/10/23 Peer Consulting GroupJim Sutter
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04/10/23 Peer Consulting GroupJim Sutter
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Value Issue
“IT projects should undergo the same economic analysis as all other capital investments”
Ed Trainor, CIO, Amtrak
04/10/23 Peer Consulting GroupJim Sutter
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CEO surveys, 1977-2011
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“It’s estimated that fewer than 1/5th of all corporations have a process in place by which to cost justify an IT investment or determine if a new technology implementation will yield long-term corporate benefits.”
Industry Week Magazine
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• Materials Management (MRP)
• Shop Floor Control• CAD - CAE• Analytic Computation• Word Processing
• Direct Customer Access• Product Configurators• Product Customization• Fast Response/JIT• EDI/E-Commerce• Supply Chain/E-Pro• Social Networks• BYOD• Blogging,Wikis,Twitter
1960 - 19731960 - 1973 1973 - 1980s1973 - 1980s 1990-2000s1990-2000s
Faster Ledgers----
Direct Savings
Faster Ledgers----
Direct Savings
Operating Efficiencies
----Indirect Savings
Operating Efficiencies
----Indirect Savings
Virtual Corporation----
Growth
Virtual Corporation----
Growth
• Accounting/Finance
• Payroll• Sales Statistics• Cost Distribution• Inventory Accounting
It Has Become More DifficultIt Has Become More Difficult
- look to results of industry specific surveys - search industry specific journals or
publications - check with consulting companies who specialize in your industry - review companies selling solutions for specific problem area
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Obtaining solid ROIs from business leaders is weak in many companies.
IT leaders often attempt to substitute their own estimates.
Real VALUE can be found by intense digging using improved tools.
CIOs can improve the process for identifying VALUE by looking outside.
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