Thursday, February 11, 2016

How to Build the Value Added IT Capabilities

IT is not just the sum of services or processes, but a cohesive set of business capabilities.

Many forward-thinking IT organizations are on the journey to improve its own maturity, also take a leadership role in driving their organization’s digital transformation. CIOs as IT leaders must be able to develop and optimize IT operational functions and harness value added IT capabilities within itself. It is one thing to run IT as an enabler for the business strategies and objectives. It is also something to have IT resources (people and operational IT processes) refined to the point that they are nimble, can adapt to changing business demands in a timely fashion. More specifically, what are the most important IT capabilities and how to build them effortlessly?

Effectiveness: Generally speaking, effectiveness is about doing the right things. To build and demonstrate IT success, IT leaders need to focus on the business IT roadmap; that is how IT enables strategic goals and objectives of the business, leverage IT to optimize business processes, and implement an effective IT strategy as an integral component of the business strategy. IT investments positively affect business productivity and customer experiences. IT provides the competitive leverage. If CIOs had the seat at the big table, IT can achieve strategic business objectives with the priorities from an executive management perspective. effectively.

Efficiency: Efficiency means to do things right - better, faster, cheaper. IT supports the achievement of tactical business objectives, IT delivers perceived added value services at a reasonable cost, IT delivers to operational and service level agreements and commitments, IT improves process efficiency and manages cost continually. The approach is to implement a program that like a gardener would prune the tree and nurture the valuable solutions. Pruning the weeds would face resistance, however, at the end of the day, this was not just an IT decision and rather than let the senior management team beat them up, by understanding and communicating the actual costs, IT is responsible to keep the light on in most efficient way, and leverage the latest technology tools to manage business complexity.

Agility: Agility is a measure of ability to recognize, act and benefit from changing business circumstances. Business agility is the reciprocal of the lag time between recognizing an emerging business opportunity and being able to act on that opportunity. And IT agility is the reciprocal of the drag that IT places on business' agility. At the micro level, it is more about building the product right, In the context of IT, from the highest strategic to the deepest technical levels, "agility" is a fast, sure response to external stimuli. It is the ability to "pivot" and change direction in response to market pressure, or to create market opportunity, It requires distinct patterns of IT capabilities, with specific positioning in the organization.

Change: IT is always at the center of change, it’s also an important element in building the business’s change capability. Change is happening all the time, the management just has to acknowledge and appreciate that. "Change" can be a somewhat mechanical implementation of new or different ways to doing something while the leapfrogging change like digital transformation is more likely to be a sweeping approach to altering a culture, or parts of it, possibly even to parts of its value system, to embrace such as change and help it become self-perpetuating. Process underpins business capability, IT is the only entity in the organization supposed to understand business entirely and oversight organizational processes horizontally, and pay attention to the change processes under the surface, in order to build change as a crucial business capability via platform approaches and systematic disciplines.

Innovation: Innovation is to transform novel ideas and achieve its business values. and innovation is a crucial capability for digital businesses. IT has a natural innovative spirit - most IT specialist is eager to use new technologies and gadgets. But there is a significant difference between technical proficiency and business innovation. Natural IT innovation spirit can be used to the benefit of business only when IT participates in defining strategy and business goals and make IT as a business driver and strategic capability. Isn't that what innovation is all about: do it better, differentiate yourself from your completion, run, grow and transform the business. Innovation is not just about technology, Innovation is not always equal to the latest gadget, it’s about people, culture, partnership, manners, etc, woven together as a unique business capability. IT needs to be able to provide an innovative service or supply a differentiated solution that contributes to top line growth, and become the business’s innovation engine.

Flexibility: Flexibility is to embrace the different PoVs and alternative ways to do things. A flexible IT organization is a complex social system starting to appreciate such attributes as 'readiness,’ "creativity," 'ownership,' ‘integration,’ 'full open communication,’ customized structuring as well as developing partnerships. From a structure perspective, centralized, decentralized, and hybrid models can all work given the proper planning and management focus to keep them well-tuned for improving IT flexibility, business agility, and governance flexibility.  

Scalability: With increasing speed of change and continuous digital dynamic, IT nowadays is more about “designed to change,” less about “built to last,” be able to scale up and down according. With cloud and the emergent consumer-drive IT service model, business leaders are keen to drive adoption forward, particularly given current cost pressures and the need to explore new business ideas quickly, IT can leverage Cloud and other digital technologies to improve technical characteristics like “scalability” and “capability modernization more seamlessly.

IT is not just the sum of services or processes, or monolithic hardware only, IT needs to build a set of value-added digital capabilities via weaving all necessary hard and soft elements, in reaching high-level maturity. IT is not just part of the business; it is a critical, integral component of the business. When a CIO is able to position and maintain the IT organization to ensure it addresses both IT effectiveness and efficiency, agility and innovation, flexibility and scalability, they have earned their stripes. And IT can show how it is improving the business and enforcing business capabilities.


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