Making a Successful Link between IT and Business

Feature Article | September 7, 2005 by admin

Yet this task of aligning IT investments with business goals is easier said than done. It takes time to understand and careful planning to articulate the exact business requirements of technology. SMEs must ensure that IT investments have a detailed business review and management commitment in order to enjoy the expected benefits of IT and gain a head start on competition.
Furthermore, SMEs are spoilt for choice these days as there is a variety of solutions at different price ranges to choose from. This makes it tempting to favor cost and purchase cheaper alternatives when selecting a solution for immediate relief of a business problem.
The downside of this short-term, patchwork approach without considering how the IT investment can survive a long-term business road map of delivering to growth expectations means that companies may actually end up spending more than what is necessary on implementation and maintenance. This patchwork approach would also ultimately cost more and will not be scalable.
Such unnecessary costs can be minimized and IT investments can be maximized by ensuring IT and business goals are aligned. In order to achieve a close alignment, here are some key points CXOs of an SME must take note of:

Top management involvement

Don’t leave all IT project planning and decision making to IT staff as they may not have as good an overview of business requirements as top management does. That is why CXOs must be very clear on what they want to do in terms of their IT strategy and be actively involved in the IT decision-making process.
They must also set aside time to take ownership of the evaluation and implementation process, as well as get key stakeholders in both the business and IT departments involved. Only by bringing the business and IT folks together can companies define realistic goals that are beneficial. This will then make it easier for the rest of the staff to accept the changes.

Focus, focus, focus

It is easy to lose sight of the business objectives of the IT project, so keep these objectives well defined, short and well communicated to all those who are preparing for the implementation and will be involved in it. In addition, all parties must understand these objectives in the same manner, they must be updated on all changes made by top management as they happen, and these changes should be documented.

Assess technology carefully and review project regularly

Ensure that the technology selected will support current and future business needs. In addition, determine key performance indicators (KPIs) such as expected benefits, total cost, and the implementation timeframe of the project.
With these objectives in hand, SMEs can then evaluate progress regularly during the implementation process, nip problems in the bud, and ensure the project remains in line with business goals. This will also help these companies to decide if the original IT and business goals are realistic and to modify them accordingly.
Reviewing both the monetary and intrinsic return of investment (ROI) should be conducted after completion of the project to measure its effectiveness and plan for future upgrades.

Vendor communication and selection

Communicate the company’s goals to the IT vendors as well instead of just asking them what their software can do so that they too can help align IT investments with business needs.

IT as a revenue-generating center

Traditionally, the IT department is seen as a cost center and relegated to a backroom role. It is time to change that perception. The IT department head should be involved in key business discussions and play an active role in the business decision-making process. In return, this will create an IT department that has a good understanding of the company’s business challenges and is capable of mapping IT goals in correlation to business needs.
Ultimately, the task of aligning IT investments with business goals can be challenging but companies can certainly reap the benefits of doing so quickly and more cost effectively with the right IT partner. It is therefore imperative to work with a vendor who understands your business well and who will still be around to support you as your IT strategy matures.
SAP is one such vendor that is in the business of knowing what SMEs need in order to stay competitive day after day. By offering an integrated suite of affordable, scalable business management software, SAP offers a one-stop-shop solution. This is crucial as it means SMEs can avoid the hefty costs associated with integrating different vendors’ products together.
In summary, all IT projects must be a consolidated effort of both the IT and business departments. Viewing IT in isolation, separate from all other business decisions, will only lead to IT projects that fail to live up to expectations.

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