In DEJ’s recent survey, 61% of organizations reported that they are looking to use technology to create competitive advantage. As business executives are becoming more interested in how to leverage technology to achieve their key business goals, they are looking to get a clear understanding about how different types of technology can help with that. Fifty-eight percent of organizations that participated in the same research reported that their process for evaluating technologies has to change to become more business centric. Getting business executives more involved in the process of evaluating poses a number of questions:
- How well they understand value propositions of various technology classes and strengths and weaknesses of different solutions?
- Does vendors’ messaging provide a clear correlation between features and functionalities of their solutions and outcomes that business executives are working towards?
- Are business executives looking to become more knowledgeable about technical aspects that differentiate technology solutions?
The answer to all of these questions is – NO. The key reason why the business is becoming more interested in evaluating technologies is to better understand how deploying new solutions can help them create desirable business outcomes. However, it is often difficult for them to understand how, for example, a solution such as IT performance monitoring can help them improve customer engagement.
For that reason, they are putting more emphasis on technologies whose business impact is more obvious and have a direct impact on business metrics. In the meantime, many technologies whose influence on the business is less obvious are being placed lower on business technology agendas even though their impact on the business goals is as strong, if not stronger.
The research also shows that 57% of business executives are looking to make IT more strategic, but at the same time, 53% perceive IT-centric technologies (infrastructure management, performance monitoring, etc.) that are critical for supporting technology processes as not very strategic. Obviously, IT and business are still disconnected and that is mostly due to the fact that they do not speak the same language. That becomes even more apparent when it comes to evaluating different technologies. For example, lack of executive buy-in was reported as the biggest obstacle for investing in some innovative IT technologies, even though these technologies can play an important role in supporting digital transformation and enabling business growth.
Additionally, organizational structure is increasingly playing a major role in the effectiveness of deploying various technologies. As business executives are looking to get more involved in technology purchases, they need to clearly understand if any given type of technology would be a good fit for their organization based on the way it is currently structured.
IT and the business are clearly not speaking the same language and if we are expecting that disconnect to be addressed by business executives learning more about IT, that is just not going to happen. So what else can be done about this issue?
To be able to establish an effective process for evaluating technologies based on their impact on business outcomes, organizations need to build the multi-step process for tying achievement levels of key business goals into deployments of specific technology capabilities. In other words, they need to find where the key dots are between technology and business and be able to connect them.
” You can’t connect the dots looking forward; you can only connect them looking backwards.” – Steve Jobs
Connecting the dots:
1 – Self assessment. Business professionals should start technology evaluation from their desired business outcome and through self-assessment identify: 1) key challenges for getting to that outcome; 2) factors that are attributing to reaching that goal; 3) their current performance in key areas that are leading to that outcome.
2 – Benchmarking and best practices. In the process of achieving the desired business outcome, organizations need to understand how their current position compares to their industry and that of their key competitors. The benchmarking process will also help to understand what companies, that are leading the market in key performance indicators, are doing from technology, processes and an organizational structure stand point that enables them to outperform their peers.
3 – Gap analysis and action plan. After analyzing what market leading companies are doing to achieve their goals, organizations should have a better understanding where their gaps are from: 1) strategy, 2) organization; and 3) processes perspectives. This will also allow them to recognize the role that the technology can play on improving in each of these three areas. From there, organizations can make more educated decisions about specific technology capabilities that they need to have in place and actions they should be taking to get to the desired business outcome(s).
4 – Defining a new approach for technology evaluation. After they complete the first three steps, organizations might realize that general value propositions of technologies that they should be evaluating, at first glance, have very little to do with the business goals they are trying to achieve or that they are, in general, mostly used by the IT. That is the important step of defining a new technology evaluation process that includes a more clear understanding of what are very specific capabilities that these organizations are looking for and how to go about identifying solution providers that offer these capabilities.
5 – Attributes of a new evaluation process. The evaluation approach that is designed by diligently following the processes of identifying and connecting the dots between the business outcome and technology capabilities, results in the following:
- Come up with a new set of very pointed questions to ask technology vendors and see who are those that really want to understand your business (versus those that just want to sell you their product) and be true partners
- Start looking beyond ROI and “when will it pay for itself?” and focus on business outcomes and creating a competitive advantage
- Build organization and processes that will make new technology deployments more effective
- Establish a new set of metrics for evaluating technology purchases in the context of business outcomes
The process for connecting the dots between desired business outcomes and very specific technology capabilities can produce major benefits for both technology user organizations and vendors. One of the benefits is being able to see beyond marketing messaging of technology vendors and reduce the noise in the market. After defining this business centric approach for technology investments, organizations will realize that they are not looking at tens or hundreds of vendors that they should evaluate, but only a handful of solutions whose capabilities can really lead to positive business outcomes.
