Tag Archives: Business transformation

How do we benefit from technology? Wrong question!

Bandah Acheh 2005
Destroyed by a tsunami

We all know “it” is coming, although we really don’t understand exactly what “it” is. It has something to do with new ways of working, new business models, changing customer habits and connectedness. For certain it is all driven by changing technologies and information technology is at its heart. Businesses want to be on the wave and are asking how to achieve this. I think it would be more useful to frame the question the other way:

How do we stop technology from destroying the value in our business? I have three easy steps:

1. Be excellent at running technology within your business. There are a host of best practices for IT out there, and while there are differences in approach at the edges, they basically agree about the major concepts. The business leaders must mandate a level of maturity to these business practices.

The key areas that should be in place are: Quality & improvement (e.g. ISO9000, Six Sigma, Continuous Service Improvement); Corporate governance of IT (e.g. ISO38500, ValIT); Service management (e.g. ITIL, ISO20000 or my new favourite Cobit5); Execution methods (e.g. BABOK, PMBOK, Prince2, CMMI); and architecture (e.g. TOGAF, FEAF or Zachman).

2. Make technology a core component of strategic planning. You should be rewriting your business strategy with some urgency if it does not have technology as an important component (yes this applies to every business). The market analysis that informs the strategy should include a technology evaluation (use your CTO if you have one).

Once you have current state, transition state and target state identified, you need to model the organization. This is called enterprise architecture and will identify what needs to change (people, technology, processes) as you progress. With this you can estimate costs and create a business case around the strategy.

3. Drive accountability. You now have a strategy, an investment plan and expected benefits (increased profit, more loyal customers, better compliance etc). Make key staff accountable for delivery on time, on budget with all benefits realized. Be particularly careful to manage scope and do only those things that truly drive the benefits.

The above is not the complete recipe for success – you still have to get the right strategy, but it is likely to eliminate a key cause of failure. Unfortunately I do not see many businesses doing this.

This year in the UK alone we have seen retailers Jessops, HMV, Blockbuster and Republic go into administration. There has been a huge destruction of wealth that should be sheeted back to their boards. I very much doubt that any of these chains were following the principles above.

Are you thinking about how you prevent technology changes from destroying your business?