IT As A Strategic Asset

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IT As A Strategic Asset

• Stephen Ibaraki FCIPS, I.S.P., MVP, DFNPA
• National President-elect CIPS Fellow (FCIPS)
• Canadian Information Processing Society
  (CIPS), www.CIPS.CA
• Government Legislated Information Systems
  Professional (I.S.P.)
• Industry Analyst Computing Canada, IT Leadership
  Lifetime Achievement Award
• Distinguished Fellow NPA (DFNPA)
• Microsoft Most Valuable Professional (Awarded
  MVP 2006, 2007)

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IT as a Strategic Asset Overview

• Question need for aligning IT with business
  strategy?
• After 20 yrs Only 10-20 IT Budgets into
  improving business performance
• Auditor Generals Report 2/7 met all criteria
  for success
• Iansiti MS Wal-Mart Dell, SMBs
• McFarlane IT Governance? Company Governance
  operational/strategic/risk/competitive position
• DeLisi IT ? Strategic level Maximum business
  advantage
• Ackoff Performance interaction of parts (not
  separately)

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IT as a Strategic Asset Overview

• Understand Business Goals (long term results)
  DEpendable Future suCCess Development,
  Employee, Financial, Customer, Competitive
• Align with Value Disciplines good COP equation
  Customer stickiness, Operational excellence,
  Product/service innovation
• Being Gartner Versatilists BAIT
  characteristics Business, Attitude,
  Interpersonal, Technology
• Involve the IT Team clarity on business
  strategy/goals, off-site meetings for alignment

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IT Enabling Business Strategy

• What are the Vital Business Elements to
  IT/Business Alignment?
• How do you employ a Business Plan Model to make
  IT a strategic asset?
• Driving Business Value with IT

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Vital Elements to IT/Business Alignment

• 1) Providing high value and clear differentiation
  from the competition
• Rules of competition (adapted from Porter)
• Positioning against rivals
• Barriers to entry of new competitors
• Staying ahead of substitute products/services
• Reducing the bargaining power of
  suppliers/consumers
• Enhanced user experience
• Early leadership is not enoughcontinual
  innovation

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Vital Elements of IT/Business Alignment

• 2) Supporting a low cost operational advantage
• Tied to business profitability and growth
• Eliminating workflow bottlenecks, doing more with
  less, removing disconnected information silos,
  preventing duplicated effort
• Automation is the start but you work towards
  optimization infrastructure, applications /
  development, process, people

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Vital Elements to IT/Business Alignment

• 3) Increasing productivity, efficiency, with
  Collaboration
• Businesses process improvements
• Collaborating partners, suppliers, governments,
  industry, businesses, media
• Collaboration service improvements gt double
  customer retention, 300 savings from stickiness
• Improvements in messaging, communications,
  project work amongst employees

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Vital Elements to IT/Business Alignment

• 4) Enabling market focus niches
• Extending reach into new markets
• Enhancing and improving your service into
  existing markets
• Creating insight into relationships with business
  intelligence (pricing, positioning, promotion,
  product/service improvements, distribution)

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Vital Elements to IT/Business Alignment

• 5) Providing continual innovation reducing time
  to market for new products and services
• We lag other countries
• Business agility and growth
• Internal/external monitoring catalyst for
  innovation
• Moving to opportunities in real time

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Vital Elements to IT/Business Alignment

• IT Enabling Business Performance/Strategy
• Real quantifiable value to stakeholders
• Effective collaboration maximizing relationships
• Business agility
• Faster to market Instant response Anticipation
  of threats Higher productivity Improved
  efficiency, Lower operational cost and risk
• Cost overhead or business strategy enabler?

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Vital Elements to IT/Business Alignment

• Michael Treacy and Fred Wiersema The Discipline
  of Market Leaders
• Research of excellent companies
• Excel in one of three values (COP)Customer
  intimacy/relationship, Operational
  excellence/efficiency, Product leadership/innovati
  on
• Good at the other two
• What does this mean to you?

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Using a Business Plan ModelDriving IT as a
Strategic Asset

• Must link the IT investment with increased
• Business value Differentiation
• Lower costs
• Collaboration
• Market focus
• Innovation
• SME-centric economy 80 not a top priority
• What questions should you ask?

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Using a Business Plan ModelDriving IT as a
Strategic Asset

• Purpose What are the overall links between the
  IT investment, objectives and the business
  objectives?
• Vision What does the business want to become in
  the future and how will IT support this overall
  goal?
• Mission What is the current business and how
  will IT enhance this overall business mission?
• Business opportunity and estimated market size
  How will IT enable or support the new business
  opportunity and what value will it return? How
  big is the market potential?

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Using a Business Plan ModelDriving IT as a
Strategic Asset

• Business model What products/services does the
  business offer? How does IT drive the SMART
  objectives of the business?
• Target markets and delivery models How does IT
  allow increased penetration into target markets?
  
• Business/product/service integration enabled with
  technology What specific processes/products
  /services are keyed on the integrated and unified
  technology platform?
• Competitive analysis Who are the competitors?
  What are their strengths and weaknesses? How are
  they employing technology?

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Using a Business Plan ModelDriving IT as a
Strategic Asset

• SWOT analysis What are the strengths and
  weakness opportunities and threats to the
  business?
• Marketing strategies How does IT drive the sales
  and marketing strategies? Price, Promotion,
  Positioning, Product, Placement/Distribution
• Human capital strategies Skills Gap?
  Retirements? How will IT empower the employees
  for collaboration, productivity, efficiencies,
  and satisfaction?
• Resource analysis What are the resource
  requirements for the IT investment before,
  during, and after implementation?

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Using a Business Plan ModelDriving IT as a
Strategic Asset

• Metrics for IT success
• What are the SMART IT objectives and how do they
  align with the SMART business objectives?
• What are the contingencies backup plans if
  there are unexpected disruptive forces?
• Financial projections TCO, ROI, Timing,
  Pro-forma
• What is the total cost of ownership new
  business opportunities value of these
  opportunities?
• How will the return on investment be realized
  in achieving business success, good COP equation?
• What are the times frames for ROI?
• What are the pro-forma financial improvements in
  real terms increased revenue, lower
  costs/expenses, increased profitability?

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Using a Business Plan Model Changing Workforce?
Company loyalty
Financial success
Strongly independentRicher User Experience
off-site
Millennials Gen Y (b. 1980 to 2000)
Personalized work Richer User Experience
Source Get Ready The Millennials Are Coming!,
Forrester Research, Inc., September 2005
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Using a Business Plan Model Information Worker
of the FutureUser and Consumer at the Center?
Source The Client Computing Scenario An
End-User Revolution Approaches, Gartner, Steve
Kleynhans, Delivered at Gartner Fall Symposium
2005
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Driving Business Value with IT
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Final Considerations Its about people

• CIPS Canadas Association of Business/IT
  Professionals
• Host/sponsor Education and Events ? BAIT support
• National / International validation CATA,
  IFIP, ICTC, BCS, ACS, GATS, OASBO, , etc.
• Only legislated IT Professional Designation
  Information Systems Professional (I.S.P.)
• Adhere Prof Development, Code of Ethics, Body of
  Knowledge
• www.cips.ca , cips-vancouver.org gt Join for
  Strategic Advantage
• sibaraki_at_cips.ca , blogs.technet.com/cdnitmanagers