Forrester: No money, no problem

Simply focusing on getting projects on time and on budget is killing traditional IT, according to a group of Forrester Research Inc. analysts. Even amid the economic crisis, IT leaders must get out of their defensive shell and shift from an enterprise utility to a business partner.

Unlike the last economic recession, in which IT took most of the abuse, today’s struggles have left every business unit at risk. During a recent Web-based panel discussion, Forrester analysts argued that businesses are using the downturn as a catalyst for change. IT leaders focused on delivering better value and communicating more effectively with the rest of the enterprise will ensure themselves a seat at the business table when the economy rebounds.

1. Be flexible

Jeff Scott, a senior analyst at Forrester, said that staying the course is the wrong move for enterprise IT professionals. Recently, a major U.S. enterprise was going through a series of cost-reduction initiatives, he said. The company’s team of enterprise architects decided to put some of their projects on hold for a year to spend time acting as a SWAT team for IT.

“They did a ton of project analysis, budget analysis, combining of systems and repurposing of other systems during that time,” Scott said. “They stayed together through the cost-reduction initiative and picked up support from the CIO, who saw them as real team players.”

To become flexible, you actually have to start thinking beyond the short-term tactical view of IT, he said, and toward a more strategic, goal-based business view. That requires IT leaders to move away from the status quo and start thinking outside of the box.

2. Getting out and about

And the first step to thinking out of the box is to actually get out of the box, according to Laurie Orlov, a former Forrester analyst turned independent consultant. The ability to communicate has not been a traditional core competency for IT, she said, and it’s something that starts at the top.

“CIOs need to regularly provide information on what IT is actually doing,” Orlov said. They need to provide comparisons, she added, not just about what the company is saving now, but what they’ve saved in the past and our planning to save in the future.

IT executives should always be reminding people who’s who in IT, keep the rest of the business in the loop on any personnel changes, and clearly identify the point-person on high priority projects.

“IT needs to be sending out messages, newsletters, really owning the communication,” Orlov said. Simply showing up at the quarterly meetings and giving an update is unacceptable these days, she said.

Matthew Brown, principal analyst and research director at Forrester, added to Orlov’s point, saying that open technologies such as blogs, wikis and discussion forums can boost IT’s visibility across the business. This conveys a sense of transparency and accountability to employees and senior management, as everybody will be in the loop on what IT is doing and why they are doing it.

3. Putting business outcomes first

In order to move IT away from the perception of being a utility to becoming a fully functional business partner, Orlov said technology leaders must start thinking like business leaders.

“It’s nice to measure client satisfaction and know which part of the company isn’t satisfied with what you’re doing,” but it’s really business outcomes that must be measured and stressed, she said.

The business isn’t going to take IT seriously without “super-credible infrastructure,” Orlov added, so IT directors must get that sorted out before any serious partnership with the rest of the business leaders can form.

Assuming this is met, there needs to be some form of relationship management with other business units. She said this is probably best achieved by an advocate outside of IT.

“CIOs need to remember that IT infrastructure is the foundation for their company’s communication, service and efficiency with customers,” Orlov said.

“IT is the custodian of a great deal of information that can help the business grow again.”

And finally, because the root of the downturn is a lack of access to capital, Brown said that technology leaders must realize any opportunity to bring hard cash to the table will be welcomed by enterprise leaders. Renegotiating licence costs with vendors and reevaluating the value of your current IT investments is a good place to start freeing up that capital, he added.

Brown said that moving select applications to a software-as-a-service model should also be considered.

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