the core problem of the it industry
DESCRIPTION
This is a fairly technical presentation that takes viewers through the logical, Theory of Constraints based processes Space Age Technologies followed to identify the core problem of the IT industry for small and medium businesses. It also touches on the challenges we need to overcome as well as a generic, high-level solution framework that will allow us to permanently close the identified business IT gap. Although not specifically mentioned, this work directly led to our development of our freely available Relevant IT framework and free assessment tool to establish organisational Relevant IT maturity (http://www.relevantit.co.za)TRANSCRIPT
The journey to
(and why we should pause before making serious IT investments)
By Mark Geschke – Managing DirectorTwitter: @mggeschkeEmail: [email protected]
Can IT create Value?
Although we believe IT could add significant (business) value, we just don't believe it to be true for our
business (and have virtually given up trying to get it).
Can IT create Value for an SME?
Complaints by Business Leaders
• Many investment and operational IT decisions do not advance business goals (and sometimes even imperil them)
• There is increasing pressure to spend more money on IT infrastructure upkeep
• There is high IT staff turnover• Business is often unaware of transformative IT opportunities• Service levels are inconsistent (sometimes good and sometimes bad,
usually depending on who provides the service)• Perception of business-value of IT diminishes over time• IT increasingly struggles (takes longer and longer) to deliver on
business needs• IT people have become known as the "no" guys, causing immense
frustration to business leaders that expect to move fast
IT’s Complaints
• IT struggles tremendously to keep up with increasingly complex IT environments and user needs. It seems like a losing battle…
• Established processes are bypassed to get better service• IT service priorities frequently change at short notice• IT is often unaware of the needs of the business (because
nobody talks to them about business requirements)• The IT services backlog grows continuously.• Most IT people feel completely overworked, underappreciated
and demotivated.• High IT staff turnover• IT-related risks to the business are increasing at a rapid pace
• Customers are more and more suspicious of recommendations made by IT consultants
• IT Consultants have to work harder and harder for every successful engagement
• IT Consultants struggle to stay up to date with rapidly changing technology options and sometimes even look incompetent in front of customers…
• There is often little to differentiate IT services offerings (although all vendors claim to be “the best”)
• All customers seem to talk about these days is to control IT costs… why don’t they enquire about value?
• Running a successful IT consulting business becomes increasingly difficult
The IT Consultant’s Complaints
All Complaints are linked!
Many investment and operational IT decisions do not advance business goals (and sometimes even imperil them)
The Critical Problem
[Critical Problem] Many investment and operational IT decisions do not advance business goals (and sometimes
even imperil them)
The Core
Conflict
Goal: IT contributes to business success
Need: Reliable and cost-effective IT platform
Need: IT adds value
Manage IT as a value
driver
IT is a significant business enabler
And
Manage IT as a cost centre
All IT decisions are made based
on Trust.
And
Business PeopleStrategies
Value
Technical PeopleProducts/ServicesFeatures
[Critical Problem] Many investment and operational IT decisions do not advance business goals (and sometimes
even imperil them)
The Core
Conflict
Goal: IT contributes to business success
Need: Reliable and cost-effective IT platform
Need: IT adds value
Mindset Challenge:
Many SME business leaders view IT in a purely supporting role and only rarely include it in strategic planning activities.
Manage IT as a value
driver
IT is a significant business enabler
And
Manage IT as a cost centre
All IT decisions are made based
on Trust.
And
Business PeopleStrategies
Value
Technical PeopleProducts/ServicesFeatures
[Critical Problem] Many investment and operational IT decisions do not advance business goals (and sometimes
even imperil them)
The Core
Conflict
Goal: IT contributes to business success
Need: Reliable and cost-effective IT platform
Need: IT adds value
Mindset Challenge:
Many SME business leaders view IT in a purely supporting role and only rarely include it in strategic planning activities.
Manage IT as a value
driver
IT is a significant business enabler
And
Manage IT as a cost centre
All IT decisions are made based
on Trust.
And
Focus Challenge:
IT leaders are expected to wear many hats and usually have a strong bias towards the more technical/operational sides
Business PeopleStrategies
Value
Technical PeopleProducts/ServicesFeatures
[Critical Problem] Many investment and operational IT decisions do not advance business goals (and sometimes
even imperil them)
The Core
Conflict
Goal: IT contributes to business success
Need: Reliable and cost-effective IT platform
Need: IT adds value
Mindset Challenge:
Many SME business leaders view IT in a purely supporting role and only rarely include it in strategic planning activities.
Manage IT as a value
driver
IT is a significant business enabler
And
Manage IT as a cost centre
All IT decisions are made based
on Trust.
And
Focus Challenge:
IT leaders are expected to wear many hats and usually have a strong bias towards the more technical/operational sides
Business PeopleStrategies
Value
Technical PeopleProducts/ServicesFeatures
Complexity Challenge:
Making good IT decisions is extremely complex due to the rapid pace of innovation, the multitude of dimensions to always consider as well as a lack of effective decision-making tools.
[Critical Problem] Many investment and operational IT decisions do not advance business goals (and sometimes
even imperil them)
The Core
Conflict
Goal: IT contributes to business success
Need: Reliable and cost-effective IT platform
Need: IT adds value
Mindset Challenge:
Many SME business leaders view IT in a purely supporting role and only rarely include it in strategic planning activities.
Manage IT as a value
driver
IT is a significant business enabler
And
Manage IT as a cost centre
All IT decisions are made based
on Trust.
And
Focus Challenge:
IT leaders are expected to wear many hats and usually have a strong bias towards the more technical/operational sides
Business PeopleStrategies
Value
Technical PeopleProducts/ServicesFeatures
Complexity Challenge:
Making good IT decisions is extremely complex due to the rapid pace of innovation, the multitude of dimensions to always consider as well as a lack of effective decision-making tools.
Results Challenge:
The results delivered by the IT function are not aligned to business expectations. Why would business leaders believe further promises from IT?
[Critical Problem] Many investment and operational IT decisions do not advance business goals (and sometimes
even imperil them)
The Core
Conflict
Goal: IT contributes to business success
Need: Reliable and cost-effective IT platform
Need: IT adds value
Mindset Challenge:
Many SME business leaders view IT in a purely supporting role and only rarely include it in strategic planning activities.
Manage IT as a value
driver
IT is a significant business enabler
And
Manage IT as a cost centre
All IT decisions are made based
on Trust.
And
Focus Challenge:
IT leaders are expected to wear many hats and usually have a strong bias towards the more technical/operational sides
Business PeopleStrategies
Value
Technical PeopleProducts/ServicesFeatures
Complexity Challenge:
Making good IT decisions is extremely complex due to the rapid pace of innovation, the multitude of dimensions to always consider as well as a lack of effective decision-making tools.
Results Challenge:
The results delivered by the IT function are not aligned to business expectations. Why would business leaders believe further promises from IT?
“No Alternatives”Challenge:
We are not aware of any management approach that could achieve both reliable, cost-effective IT platforms as well as add business value.
Focus Challenge:
IT leaders are expected to wear many
hats and usually have a
strong bias towards the
more technical/operational aspects.
“No Alternatives” Challenge:
We are not aware of any management approach that could achieve both reliable, cost-effective IT platforms as well as add business value.
Mindset Challenge:
Many SME business leaders view IT in a purely supporting
role and only rarely include it in business planning activities.
The Relevant IT Roadmap
Complexity Challenge:
Making good IT decisions is extremely complex due to the rapid pace of innovation, the multitude of dimensions to
always consider as well as a lack of effective decision-making
tools.
Results Challenge:
The results delivered by the IT function are
not aligned with business expectations. Why would
business leaders believe further promises from
IT.
Focus Challenge:
IT leaders are expected to wear many
hats and usually have a
strong bias towards the
more technical/operational aspects.
“No Alternatives” Challenge:
We are not aware of any management approach that could achieve both reliable, cost-effective IT platforms as well as add business value.
Mindset Challenge:
Many SME business leaders view IT in a purely supporting
role and only rarely include it in business planning activities.
Business Expectations
There is a strong belief
amongst business
leaders that IT could
contribute in a significant way
to better business
performance.
The Relevant IT Roadmap
Complexity Challenge:
Making good IT decisions is extremely complex due to the rapid pace of innovation, the multitude of dimensions to
always consider as well as a lack of effective decision-making
tools.
Results Challenge:
The results delivered by the IT function are
not aligned with business expectations. Why would
business leaders believe further promises from
IT.
Focus Challenge:
IT leaders are expected to wear many
hats and usually have a
strong bias towards the
more technical/operational aspects.
“No Alternatives” Challenge:
We are not aware of any management approach that could achieve both reliable, cost-effective IT platforms as well as add business value.
Mindset Challenge:
Many SME business leaders view IT in a purely supporting
role and only rarely include it in business planning activities.
Business Expectations
There is a strong belief
amongst business
leaders that IT could
contribute in a significant way
to better business
performance.
The Relevant IT Roadmap
Complexity Challenge:
Making good IT decisions is extremely complex due to the rapid pace of innovation, the multitude of dimensions to
always consider as well as a lack of effective decision-making
tools.
Strategic Positioning
IT planning and execution increasingly happens at
highest business levels
(from technology focused to business
focused IT)
Results Challenge:
The results delivered by the IT function are
not aligned with business expectations. Why would
business leaders believe further promises from
IT.
Focus Challenge:
IT leaders are expected to wear many
hats and usually have a
strong bias towards the
more technical/operational aspects.
Roles and Responsibilities
Cultivate or seek senior-
level business/IT
expertise and support
appropriately. All within SME
budgets.
“No Alternatives” Challenge:
We are not aware of any management approach that could achieve both reliable, cost-effective IT platforms as well as add business value.
Mindset Challenge:
Many SME business leaders view IT in a purely supporting
role and only rarely include it in business planning activities.
Business Expectations
There is a strong belief
amongst business
leaders that IT could
contribute in a significant way
to better business
performance.
The Relevant IT Roadmap
Complexity Challenge:
Making good IT decisions is extremely complex due to the rapid pace of innovation, the multitude of dimensions to
always consider as well as a lack of effective decision-making
tools.
Strategic Positioning
IT planning and execution increasingly happens at
highest business levels
(from technology focused to business
focused IT)
Results Challenge:
The results delivered by the IT function are
not aligned with business expectations. Why would
business leaders believe further promises from
IT.
Focus Challenge:
IT leaders are expected to wear many
hats and usually have a
strong bias towards the
more technical/operational aspects.
Roles and Responsibilities
Cultivate or seek senior-
level business/IT
expertise and support
appropriately. All within SME
budgets.
“No Alternatives” Challenge:
We are not aware of any management approach that could achieve both reliable, cost-effective IT platforms as well as add business value.
Mindset Challenge:
Many SME business leaders view IT in a purely supporting
role and only rarely include it in business planning activities.
Business Expectations
There is a strong belief
amongst business
leaders that IT could
contribute in a significant way
to better business
performance.
The Relevant IT Roadmap
Complexity Challenge:
Making good IT decisions is extremely complex due to the rapid pace of innovation, the multitude of dimensions to
always consider as well as a lack of effective decision-making
tools.
Strategic Positioning
IT planning and execution increasingly happens at
highest business levels
(from technology focused to business
focused IT)
Planning &Decision Making
Risk, performance,
cost and value-based
decision-making tools
and processes for IT portfolio management.
Results Challenge:
The results delivered by the IT function are
not aligned with business expectations. Why would
business leaders believe further promises from
IT.
Focus Challenge:
IT leaders are expected to wear many
hats and usually have a
strong bias towards the
more technical/operational aspects.
Roles and Responsibilities
Cultivate or seek senior-
level business/IT
expertise and support
appropriately. All within SME
budgets.
“No Alternatives” Challenge:
We are not aware of any management approach that could achieve both reliable, cost-effective IT platforms as well as add business value.
Mindset Challenge:
Many SME business leaders view IT in a purely supporting
role and only rarely include it in business planning activities.
Business Expectations
There is a strong belief
amongst business
leaders that IT could
contribute in a significant way
to better business
performance.
The Relevant IT Roadmap
Complexity Challenge:
Making good IT decisions is extremely complex due to the rapid pace of innovation, the multitude of dimensions to
always consider as well as a lack of effective decision-making
tools.
Strategic Positioning
IT planning and execution increasingly happens at
highest business levels
(from technology focused to business
focused IT)
Planning &Decision Making
Risk, performance,
cost and value-based
decision-making tools
and processes for IT portfolio management.
SharedUnderstanding
High-level view of the business
technology architecture to
foster broad involvement in
IT decision-making.
Results Challenge:
The results delivered by the IT function are
not aligned with business expectations. Why would
business leaders believe further promises from
IT.
Focus Challenge:
IT leaders are expected to wear many
hats and usually have a
strong bias towards the
more technical/operational aspects.
Roles and Responsibilities
Cultivate or seek senior-
level business/IT
expertise and support
appropriately. All within SME
budgets.
“No Alternatives” Challenge:
We are not aware of any management approach that could achieve both reliable, cost-effective IT platforms as well as add business value.
Mindset Challenge:
Many SME business leaders view IT in a purely supporting
role and only rarely include it in business planning activities.
Business Expectations
There is a strong belief
amongst business
leaders that IT could
contribute in a significant way
to better business
performance.
The Relevant IT Roadmap
Complexity Challenge:
Making good IT decisions is extremely complex due to the rapid pace of innovation, the multitude of dimensions to
always consider as well as a lack of effective decision-making
tools.
Strategic Positioning
IT planning and execution increasingly happens at
highest business levels
(from technology focused to business
focused IT)
Planning &Decision Making
Risk, performance,
cost and value-based
decision-making tools
and processes for IT portfolio management.
SharedUnderstanding
High-level view of the business
technology architecture to
foster broad involvement in
IT decision-making.
Results Challenge:
The results delivered by the IT function are
not aligned with business expectations. Why would
business leaders believe further promises from
IT.
Execution & Results
Strong focus on delivering
against business expectations.
Focus Challenge:
IT leaders are expected to wear many
hats and usually have a
strong bias towards the
more technical/operational aspects.
Roles and Responsibilities
Cultivate or seek senior-
level business/IT
expertise and support
appropriately. All within SME
budgets.
“No Alternatives” Challenge:
We are not aware of any management approach that could achieve both reliable, cost-effective IT platforms as well as add business value.
Process of Ongoing Improvement
Attainment of Relevant IT is a moving goal-post. Each iteration evolves the foundational capabilities below.
Mindset Challenge:
Many SME business leaders view IT in a purely supporting
role and only rarely include it in business planning activities.
Business Expectations
There is a strong belief
amongst business
leaders that IT could
contribute in a significant way
to better business
performance.
The Relevant IT Roadmap
Complexity Challenge:
Making good IT decisions is extremely complex due to the rapid pace of innovation, the multitude of dimensions to
always consider as well as a lack of effective decision-making
tools.
Strategic Positioning
IT planning and execution increasingly happens at
highest business levels
(from technology focused to business
focused IT)
Planning &Decision Making
Risk, performance,
cost and value-based
decision-making tools
and processes for IT portfolio management.
SharedUnderstanding
High-level view of the business
technology architecture to
foster broad involvement in
IT decision-making.
Results Challenge:
The results delivered by the IT function are
not aligned with business expectations. Why would
business leaders believe further promises from
IT.
Execution & Results
Strong focus on delivering
against business expectations.
A new Reality Emerges…
Many investment and operational IT decisions do not advance business goals
(and sometimes even imperil them)
Investment and operational IT decisions increasingly advance business goals
Summary of Key Points
• The IT Industry is broken!• The Business IT gap is the root cause of many
doubtful decisions and undesirable effects• Relevant IT tackles the Business IT gap and
provides practical, yet generic guidance to SMEs• Reducing the Business IT gap will systematically
increase the value of IT for all role players
Next steps?
• Use our free Relevant IT Assessment Tool to find out how mature your organisation is
• Develop a “Strategy for IT” instead of an “IT Strategy”
• Join the conversation on our LinkedIn Relevant IT group.