What can finance do to ensure an IT deployment's success?
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All IT projects are business projects -- that is to say, projects that should deliver defined value to the organization. Regardless whether the technology is on-premises, hosted, cloud or a blend thereof, it is a well-known fact that a stubbornly high proportion of enterprise IT projects fall short of their initial expectations.
Here are a few reality checks that might be helpful in increasing the probability that an IT deployment will hit the mark.
Reality Check #1: Unity is strength
Finance and IT have a number of mutually interdependent accountabilities across a range of factors such as IT cost, governance and enterprise risk. Instances where finance and IT have closely coupled strategic and tactical plans, combined with their respective enterprise-wide perspectives across the organization, make for a powerful combination in realizing the value of IT projects across the organization.
- Takeaway: IT and finance should put aside any differences and focus on developing an aligned, cohesive approach to IT strategy and business projects which have a technology dependency.
Reality check #2: IT is easy -- people are hard
The hardest to manage and most complex variable in any enterprise IT project is the business re-engineering required to guarantee the project delivers. Ensuring that the best business resources are appropriately allocated to the IT project when and where they are needed is a source of constant tension.
- Takeaway: Your IT vendor or IT department (or both) should not be expected to unilaterally implement a system and assume it will meet the organization's expectations. The opportunity cost of not having key resources appropriately allocated might just cost you the project.
Reality check #3: Keep your HIPPOs under control
The unintentional distraction and destruction wrought by an out-of-control HIPPO, or Highest Paid Person's Opinion, can in turn wreak havoc on an IT deployment. The most prominent person on a project is a target for a constellation of stakeholders attempting to influence his or her decisions in a way that might be in that stakeholder's best short-term interest, and not those of the organization. Examples include a vendor primarily concerned with their revenues or managers keen to steer IT enterprise projects toward outcomes that might help them rise through the ranks. Allowing HIPPOs to dominate major projects could be the projects' undoing.
- Takeaway: Your IT project governance processes should embody rigor but not rigor mortis. Agility is key. Welcome input from your HIPPOs, however, sets the expectation that their input will not bypass the review and assessment process.
Reality check #4: Know what problem you're trying to solve
Enterprise IT projects are a complex mix of underlying technological sophistication (even if abstracted away by outsourcing or the cloud), the organization's capability to change, risk, and potential value -- all immersed in a sea of opinion of when, where and how technologies can help the organization.
- Takeaway: Gain clarity on the exact business problem being solved, as well as its scope. This should not depend on just one person's perspective. Broad consensus and stress testing assumptions on the basis of evidence, wherever possible, is crucial.
Reality check #5: Don't drink the vendor's Kool-Aid
You cannot deliver high value enterprise IT without some support from the IT vendor in one form or another. This can range from simply purchasing an applications suite and running it internally, to complete outsourcing. If your IT deployment is critical for your business, vendor promises and assurances need to be rigorously tested. Given that most enterprise IT projects are unique, the assumption that "because it's worked well there, it'll work here" needs to be tested.
Regardless of which IT procurement model you use, recognize that a conventional approach to managing IT vendors might not be adequate in the case of new, emerging and/or disruptive business technology. The sugar hit of apparent short-term success could set the stage for subsequent failure.
- Takeaway: Upgrade your IT vendor management strategies to suit your future requirements.
Reality check #6: Don't underestimate the influence of Pavlov's Dog
Humans are, for the most part, driven by incentives, and financial incentives rank highly for most business leaders. In his famous canine experiment, Pavlov showed that conditioned responses are easily elicited when subjects are presented with an incentive.
- Takeaway: If your enterprise IT deployment requires any effort on the part of the business, the allocation of resources and time from line-of-business executives and their departmental staff will be influenced by their incentive schemes. These should be adjusted to reflect their share of accountability in the project's success.
The bottom line is that striving to achieve the full value of enterprise IT projects is not solely the responsibility of IT and finance. Just like a good meal, the organization needs to digest its own food to get the benefit. Finance and IT can be the chef and waiter, but the meal is for the entire organization's benefit.
About the author:
Rob Livingstone is a former CIO with more than three decades of experience in the corporate world. In addition to running his IT advisory practice, he is an author and commentator, providing authoritative, independent insights on a range of IT topics including emerging technologies, governance and IT security. Rob is the author of the book Navigating through the Cloud and is also a fellow at the University of Technology, Sydney, Australia, where he teaches leadership, strategy and innovation in the school's flagship MBITM program. Visit Rob at www.rob-livingstone.com or email him at firstname.lastname@example.org.
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