Sustaining and Growing Business Through Effective IT Strategy and Planning
An IT Strategy and Planning White Paper
Technology professionals sometimes lose track of that fact that IT (Information Technology) is here to support the objectives of the business, and the business is here to make money. The role of the IT team, then, is to help the organization maximize its competitive advantage with an effective IT strategy that supports or even creates that advantage.
Enact Strategies that Create Competitive Advantage
Developing an IT strategy that supports the business strategy and creates or enhances the competitive advantage of the company can sometimes be an intimidating task, but it does not need to be. Both business and IT strategies are really just plans for moving from point A to point B. Given the dynamic world in which we live, developing innovative and efficient business and IT strategies is especially important for business viability.
Consider the mapping industry. Twenty years ago, only a few people had cell phones, and most of those were attached to automobiles. GPS units were equally few and far between. Now, GPS enabled cell phones and turn-by-turn portable GPS devices are not only ubiquitous, but they have become “smart” – enabling us to avoid traffic, check the weather, analyze road conditions, and predict arrival times.
If the mapping company Rand–McNally had not been paying attention to changes in the mapping world and planning for a future where printed maps were obsolete, the company might be out of business today. Instead, Rand McNally realized that GPS systems and smart phones would forever change their business and that they would no longer be able to compete in the mapping industry. With over 18,000 documented points of interest throughout the United States in their database, Rand McNally made a strategic decision to transition from a company that creates printed maps to a business that helps fulfill customer travel needs by providing up–to–date travel information. Along the way, they deployed technology strategically to develop new products and services that enable consumer and business travel for a digital environment.
Why Do We Need an IT Plan?
The deployment of information technology is no longer optional. Businesses simply cannot go back to a manual way of doing business. We rely on computers so extensively, that if you walk into the office and the network is down, productivity drops by 99%. Simply put, if information technology is that important, then you had better have a plan.
In business today productivity is the name of the game. Think about it. If you are a small business with $1 million per year in sales, and you are down for a full day, then you can make the argument that it costs you approximately $4,000 (assuming 250 business day per year) to be “down” for the day. We can certainly argue about whether this “straight–line” calculation is always spot–on, but there’s no argument about why companies need a solid plan. Simply put, wishing and hoping do not work. If you have a plan, you can make things happen for you. If you don’t have a plan, things will to happen to you. Given those options, it’s always better to determine your own destiny. Figure out what’s changing around you and make it work for you.
How to Develop an Effective IT Strategy
Building an effective IT strategy requires four primary steps:
1. Discuss and document your business strategy.
2. Discuss and document your IT strategy, directly as it relates to the business strategy.
3. Evaluate the other dimensions of IT that speak to uptime and best practices.
4. Prioritize, estimate, execute.
Step 1: Discuss and Document Your Business Strategy
An effective IT strategy begins and ends with an effective business strategy, but creating an effective business strategy is often an incredible challenge. While it might not be as simple as “locking the senior management team in the room for two days,” business strategy does begin to take place when the senior leadership in the company – including IT leadership – take time out of their busy schedules to evaluate the health, direction and opportunities of the business. Hiring a professional facilitator doesn’t hurt, but it is not always necessary. The goal is to have open and honest dialogue about where you’re going as a company and where you should be going as a company. Questions to answer include:
- What products and/or services do we offer?
- Why do our customers choose us?
- What are our competitive advantages?
- What do we excel at doing?
- What business are we in?
- Where is our profit coming from now? In the future?
- What’s changing? How?
There is no magic here – you need to get the right people in the room and begin probing. Question your assumptions. You will also want to have a technology perspective represented in the room. The questions may sound simple, but the challenge forces you to think about them deeply. There is a certain discipline in asking the questions and gaining critical insight and perspective as to how the business environment is changing and how the business needs to adapt to remain vital.
The bottom line is that staying the same is not an option. Incremental changes need to be made. Change is never easy, but if senior leadership comes together for an honest, non– territorial discussion, the need to change and evolve will become apparent. Document the three to five major themes that emerge and prioritize them. Then, define the business–based projects necessary to support the evolution of these themes.
Step 2: Discuss and Document Your IT Strategy Directly as it Relates to the Business Strategy.
The major themes of your plan necessitate a number of action steps or business projects that are necessary to move the plan forward. Take a close look at each project and determine what IT action steps or enablers are necessary to prepare for and execute that plan. Discuss and evaluate those steps with both internal and external IT resources to gain perspective. Document the results.
Step 3: Evaluate the Other Dimensions of IT That Speak to Uptime and Best Practices
We established earlier that maximizing productivity and uptime is the lifeblood of any business. So in addition to potential new IT products arising out of the strategic planning session, you also need to take a close look at the other dimensions of IT that assure sustained productivity.
For many businesses, step 3 is often the most challenging. Investment required to maximize both uptime and productivity may or may not show up in the strategic planning session. For example, IT security may not show up in the business strategy, but protecting data assets against theft is absolutely critical to business sustainability and reputation.
The goal of the step 3 is to provide a stable, scalable and secure infrastructure and to realize that uptime can be a competitive advantage in and of itself. Other categories that should be considered by the IT organization include:
- Infrastructure improvement
- Proactive system monitoring
- Desktop security
- Perimeter security
Step 4: Prioritize, Estimate, Execute
Now that you have peered at the universe of possibilities, you need to prioritize projects, estimate costs and determine which projects will receive funding. As you begin to execute your plan, realize that sequencing and pacing matter. Not everything needs to be done all at once. Place reasonable timelines and realistic parameters around each project as you begin to implement your plan.
The value in this process is being able to relate IT efforts directly to the business strategy. The strategic planning process requires the leadership team – with IT representation – to reach a consensus about the priorities for the business. And while alignment around major strategic priorities is often elusive, doing so creates a competitive advantage for your business.