4 September 2019

IT as a Value Center

  • By Loïc Calvez
  • POSTED IN Strategy
  • With 0 COMMENTS

For a lot of companies, IT is only is a Cost Center; one of those necessary evils you must have in order to do business. Fortunately, this is changing: more and more IT is now viewed as a service center, a group of people that are there to support the business and [hopefully] help to move it forward. Although this may be seem as simple semantic, it actually reflects a more profound shift in how IT is perceived and how it acts in their day to day tasks. IT is no longer a silo in a dark office tower somewhere, it is now in communications with the business owners, it has Service Levels to meet and it is getting measured. I am a firm believer that clarity helps, it is not always fun to get told that your division is “underperforming”, but once the dialogue is open, it gets easier to find a solution and to focus on what matters for the end users, not just on the next cool thing.

Also, some companies have started to implement charge backs (real or for reference only) which put IT in direct competition with external service providers and this new cloud thing is setting the bar. A business leader looking to deploy a new CRM system now has some great options he can leverage without talking to anyone from IT, a business divisions that needs to roll out a new consumer portal now has the choice of leveraging servers that IT does not control and the list goes on and on. CIOs and CTOs will need to learn to educate their business counterpart: Who will control the costs? How will those systems be integrated to the other systems in the company? Who will users call when they have issues? How many passwords will the users need to remember? The successful CIOs and CTOs will be the ones who can provide answers and options to those questions, the ones that will keep saying no will get taken out of the equation.

This may seem like a pretty dark picture for some, but I see this as the beginning of the next steps, IT as a Value Center. They are already numerous examples out there of IT departments that worked closely with their business, found something they could help with and sometimes did it so well that the system/service was transformed into a commercial offering for other companies. IT also has something that everybody needs: data. Some companies have already started to realize that they have tons of data that can be useful for them and others. Selling that data could become a new source of revenue! In many cases there will be barriers that will stop it (for example, that data may be a key differentiator with how a company understand their customers, so selling it to competitors may not be such a good idea), but just changing the frame of mind by which IT sees itself may help them what they really need to be: a group of individuals whose opinion is valued, a Value Center.

Talk to your business counterparts, find out what’s on their mind and help them find solutions.