| | In today’s globally competitive, real-time business world, successful leaders know they don’t have time for failure – they know they need to get the job done quickly or someone else will. They also know that their competitors are literally a mouse click away and that optimizing their own use of people, processes and technologies is not just a desirable objective, but the key to survival. Improving business performance, growing bottom-line results and adding to shareholder value are increasingly dependent on using information technology (IT) more creatively and more effectively than the competition, while also controlling IT costs and growth. “World class” organizations don’t achieve that distinction by accident. They systematically strive for it by - Benchmarking themselves against established “best practices,”
- Aligning their strategies from top to bottom,
- Creating an IT infrastructure that is a business enabler for mission critical activities,
- Developing an IT group that operates as a business partner, and
- Satisfying their customers, both internally and eternally, with superior information technology services.
In short, they know where they are, where they are going, and how to get there. Understanding where you are to set a path for where you want to be
Many of these organizations have found that developing an accurate and objective understanding of their current IT strengths and weaknesses is the critical first step in their journey to world class performance. By analyzing key IT performance indicators of their organization and comparing themselves to “best in class” benchmarks compiled from other organizations of similar size and complexity, they are able to develop concrete action plans that enable them to use IT to compete more effectively. By comprehensively assessing and then optimizing their investments in technology, they are able to: - Improve their business performance, increase revenue growth and create additional shareholder value,
- Establish a comprehensive set of performance measures and underlying controls that they can rely on to run their business, and
- Mitigate the risks associated with aggressively pursuing information technology opportunities.
Assessing your IT capabilities – Never more important than today
It was not that long ago that most companies could informally but effectively align IT with their business’s needs, opportunities and strategies on an incremental basis, as individual issues and problems arose. Now, rapid and continual advances in technology, the continued growth of the Internet, and the “web-enabling” of an increasing number of business processes, systems and applications have raised both the difficulty and urgency of deploying the right technology tools to the right people at the right time. Never before has the coordination of business process throughout the entire organization been so critical to competitive success, which has made developing a complete and coherent IT strategy more complex, more difficult, more risky and more essential. Before you can develop a roadmap to your desired future, however, you need to understand exactly where you’re starting. What’s involved? How do I proceed?
Step 1 – Get organized for the IT Assessment Project: To conduct an effective IT Assessment, a formal project must be launched under the leadership of a committed and skilled executive sponsor. The scope and objectives of the project must be defined, deliverables specified, a work plan with schedules and milestones established and project resources assigned, including members from both the user and the technology communities. Step 2 – Understand the business context: Most IT Assessments fall into one of two categories, depending upon what it is that the organization’s IT activities are to be measured against. - When an organization is dissatisfied with the value it perceives in its current IT activities, it will most often want to assess its IT activities against the current needs and opportunities of the business.
- When an organization is relatively satisfied with its current IT service and support, it will most often want to assess its IT activities against its anticipated future needs and opportunities. This will produce a “gap analysis,” identifying those areas needing attention.
In either case, the IT Assessment project team must review and internalize the appropriate business activities, strategies, risks, challenges and opportunities that both set the context within which IT must operate, and that determine the specific uses of IT that would be most valuable to the organization. For example, the very same IT processes that might be assessed as incomplete and far too informal by an organization that is highly structured in its operations, might well be seen as far too rigid and stifling by a young and rapidly evolving startup.
Step 3 – Evaluate IT growth processes: Research has established that four key dimensions of IT drive its growth and evolution, and must be properly coordinated and balanced to realize IT’s potential to contribute to business success. These four dimensions, depicted in the following figure, provide us with a powerful framework for organizing both the assessment process itself, and the subsequent development of recommendations and action plans.
IT Resources – The “raw materials” or inputs to IT – the employee skills/knowledge and the hardware/software technologies needed to deliver IT services to the organization. - IT Management and Controls – The processes, procedures, tools and controls used to manage how IT will operate; e.g., how IT will ensure that resources are used effectively and efficiently, that risks are managed and that effective communication is established among technicians, stakeholders and management.
- The Applications Portfolio – The primary, tangible “output” of IT; viz., the collection of information systems and applications that are used to process transactions and present information about the business to IT users.
- IT Stakeholders – The readiness (skills, experience and knowledge) of computer users, both internal and external, to participate effectively in IT activities, decisions, plans and governance to maximize IT’s contribution to creating business value.
Step 4 – Develop conclusions, recommendations and an action plan: Observations resulting from the assessment process are reviewed and analyzed in order to generate conclusions about the current state of IT, recommendations for improvement, and action plans for proceeding. The action plan should classify steps to be taken into immediate quick-win solutions, mid-term corrective actions and long-term initiatives and programs to be pursued. |
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What results can be expected from performing an IT assessment?
The key result of any successful IT Assessment is the replacement of conflict and confusion about the organization’s use of IT, based on differing perceptions and priorities, with a consensus regarding the facts and their implications. Specific recommendations may include initiatives such as:
- Improvements to key IT processes,
- Implementation of new IT metrics, service level agreements and performance reports,
- Development or revision of IT strategies and plans,
- Changes to IT governance structures (e.g., improved prioritization processes),
- Enhanced/improved technical architectures, and
- New or revised sourcing arrangements
Implementation of recommendations resulting from an IT assessment may lead to the realization of such benefits as: - Significant cost savings,
- Improved IT performance,
- Improved business performance,
- Decreased operational risks, and
- Better control of the IT organization, processes and infrastructure.
Conducting an IT assessment project is particularly valuable when there has been a change in senior management, a change in business direction, or when the marketplace dictates that new ways of doing business are required. The IT assessment will help you explore new ways of improving your return on IT investments and enabling improved business performance.
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