Does your technology plan tied together with your long term strategy?

What's more, a recent Forrester survey found that although 50% of firms say that investing in systems to improve engagement with customers and partners is a high or critical priority, the majority see workforce computing technology as a cost and risk center, instead of an enormous opportunity for competitive advantage. Why? Because there is seldom a clear destination in mind, a rational plan to get there, and a viable system in place to execute the plan. Most of the time, the destination and the means to get there are only vague estimates, and the elements of strategy are rooted in hope.

           

              David Johnson                                       

            4 Key Elements: Strategic IT Plans         

Information Week                                   

Too often, companies view technology as a cost to avoid unless necessary.  This results in multiple systems within the company – each purchased to optimize a particular department or function, but don’t strategically fit together very well.

Before you can have a well define, robust IT strategy, you need a well define long term strategy.  Then you can tie your IT plan to your long term strategy.

Many studies indicate that over 80% of all new technology system investments fail to live up to expectations.  And, as more and more of the IT system spending "exits" the IT department, it will only get worse.

Companies have to hold IT and Marketing systems accountable just like any other part of the operations. So investment upgrades in these systems should focus on:

·         New opportunities in new markets by adding capabilities companies currently don’t have.

·         Increased revenue

·         Decreasing cost

·         Increasing productivity

Five things will help insure that your IT and Marketing system projects come in on time and on budget.

1.        Make sure that you have a well define set of requirements, with critical dates, budgets, and check offs that everyone agrees to before any work starts on the project.  This will prevent scope creep and help keep the current budget under control. In reality, this may take up to 25% of the time for the project implementation if done correctly.

2.       Assign an Executive Management sponsor to oversee the project. Make sure that regular updates are provide to the Executive team and critical deadlines and milestones are hit. 

3.       Put someone in charge of the project that has relevant experience.

4.       Insure extensive testing is done.

5.        Do one let the deadline drive the implementation  schedule.  Especially do not pick a dead and then work backwards to determine the schedule.

Virtually no IT or marketing systems have failed due to a technology issue. It seems that all the systems failures studied fail due to a process implementation issue.

Anywhere else in the organization, this would not be tolerated. Yet again and again, studies indicate that up to 60% of all IT system implementations either fail to deliver the promised results, hit the deadline, or over run the budget by more than 50%.

IT Investment Questions to Consider:

  

·         Has the project requirements truly been scoped out and everyone agreed to these requirements?

·         Do we have the right person leading the project implementation team?

·         Can we live with it if this project goes over budget by 50% or takes 50% longer than plan?

·         Has the opportunity and threat from IT been quantified by business unit and by market?

·         If so, how much?

·         And whose head is on the chopping block to make these numbers (revenue, cost) work?

·         Do our current plans reflect that opportunity?

·         Do our current plans minimize any threat?

·         What are the risks we are taking OR not taking by accepting this level of investment?

·         Do our investments in IT match our strategic plans?

·         How do they match up?

·         What capabilities do this provide that we do not currently have?

·         How can we compete better, stronger, faster, in which new markets due to this investment?

·         How long will it take?

CASE STUDY  - HOW DANGEROUS ARE IT PROJECTS?

Why Your IT Project May Be Riskier Than You Think

An alarming study by Flyvbjerg and Budzier published in the Harvard Business Review has made everyone stand-up and take notice. The coherent advice being that IT projects are much more riskier than we think.

"When we broke down the projects’ cost overruns, what we found surprised us. The average overrun was 27%—but that figure masks a far more alarming one. Graphing the projects’ budget overruns reveals a “fat tail”—a large number of gigantic overages. Fully one in six of the projects we studied was a black swan, with a cost overrun of 200%, on average, and a schedule overrun of almost 70%. 

This highlights the true pitfall of IT change initiatives: It’s not that they’re particularly prone to high cost overruns on average, as management consultants and academic studies have previously suggested. It’s that an unusually large proportion of them incur massive overages—that is, there are a disproportionate number of black swans. 

By focusing on averages instead of the more damaging outliers, most managers and consultants have been missing the real problem."

HBR, Sept, 2011