Sometimes you have to give to get
something back. When businesses
need to get things done, it’s expected that to accomplish these missions their IT
organizations must spend at least some
money on technology infrastructure. But is
everyone on the same page concerning
that spending?
“You’ve got to spend money to get solutions or products to keep things up to
date,” says Al Solorzano, practice manager,
Agile360. “But do you have a roadmap to
ensure that the IT organization’s solutions
are in lock step with the business requirements?”
Smart Business spoke with Solorzano
about how IT roadmaps can help mitigate
the long-running disconnect between businesses and their information technology
organizations.
Why is IT budget planning so difficult for so
many organizations?
Unless the profitability of your company
is completely based upon your Web site,
more than likely your IT organization is disconnected from your business organization. The IT organization may know what
widgets you make, but not necessarily
where the business makes its money. Are
you the low-cost leader? Are your widgets
that much better than everyone else’s?
Meanwhile, business may demand changes
to existing technology requirements. IT has
to deal with many moving parts as well as
try to forecast a moving target.
Why can IT be viewed as a money black
hole?
IT managers have been trained and now
only deal with keeping their costs low. This
leads to solutions that meet the minimum
requirements of the business. This also has
led to the current state of IT where most
organizations spend a majority of their
budgets on just ‘keeping the lights on,’
spending very little on projects or technologies that improve processes or
increase profitability of the organization. If
you only buy the short-term solution that
meets the minimum requirements to get
you over the hump, you may find that after
a year you’ve outgrown this solution, ultimately resulting in exceedingly high costs.
What are some ways to avoid the black hole?
An IT roadmap is crucial. It’s about eliminating poor decisions that result in buying
a solution that only meets the minimum
requirements without looking to the future,
which is what most organizations do.
Every IT person knows to ask a vendor
about a roadmap to learn how future features will affect the landscape. If IT has a
roadmap for your business, they accordingly can start to roadmap the IT infrastructure to meet those requirements. If
you’re the low-cost leader, then IT needs to
be low cost. There can be no room for lost
budgets and projects that don’t come to
fruition. If you’re the technology leader,
then IT needs to keep improving that
process so you stay ahead of the game. IT
has to know what the business side is
doing to provide the best solutions.
What kinds of events should be considered
when developing a roadmap?
An IT roadmap that spells out where the
company is going in the next three to five
years makes it more efficient for management to approve appropriate IT spending.
For example, if you know you’re going to
divest the company in half or in five pieces
in the next five years, you need to build
your IT organization so it can be divested very quickly. If you’re a company in acquisition mode, then you need to buy solutions that will be flexible so, when you
bring a company in, you can integrate the
entities as fast as possible.
Will this alleviate concerns management has
with IT spending?
Absolutely. If you only looked at the total
price column, you would never buy a high-end car because it’s too expensive. But
when you look at what the total price gives
you in return, an expensive model might
not be so bad after all. It may have been
just what you needed, meeting all of your
requirements. Get out of that sticker shock
mode. Look at what you require out of IT
— a robust, yet flexible computing and
data environment that meets the needs of
the users of today and tomorrow, all while
reducing cost and providing a measurable
ROI. Such an environment demands a
proper amount of planning and budget to
deliver on those requirements.
What strategies will help integrate IT and
business goals?
Meet with your IT organization and qualified consultants and understand what the
‘widget’ is and how the organization makes
money. Assess your current infrastructure
to figure out where you are losing time and
money. Meet with multiple levels of the
business to see how IT can better serve
them or your clients. Organize this information and prioritize tasks that decrease
your costs or provide you another source
of revenue — possibly an additional service or new capabilities that allow you to
increase prices. Some of these solutions
may require the purchase of new technology, while others may mean using what you
already have or perhaps just improving the
existing process. Then you can extend that
same view into the future to create a
roadmap for IT. It’s important to review
that IT roadmap each time budget comes
around. Some things may suddenly
become less of a priority, and other solutions that were years away may become
this year’s biggest project.
AL SOLORZANO is practice manager at Agile360. He can be
reached at [email protected] or (626) 676-1590.