Convincing business managers of the need to invest in new ITcan be fraught with challenges. IT managers must be able to demonstrate its value.
Some IT is easier to sell to business than others. The more technical the IT, the harder it is to win hearts and minds. It is easier, for example, to convince the board of the benefits of a program that generates instant sales figures, than it is to encourage them to invest in a system upgrade to support it.
However, there are a range of ways to instigate investment in IT. First, the issue of cost justification to the business has to be tackled.
"We challenge ourselves to demonstrate the return on investment from IT," said Annemarie Wolfe, chief information officer at Grey Global Group, a marketing communications company, and board member of Tif, the corporate IT forum. "That includes foundation software, the 'plumbing', and all the generic investment needed for backbone IT."
But working out the return on investment for this kind of infrastructure is extremely difficult. In a recession, a company can begrudge spending money on the latest Microsoft operating system, for example. What payback can be offered from the upgrade?
Tony Murphy, vice-president at Gartner Consulting, believes the problem lies in the pound signs. It is extremely limiting, he said, to equate business value with financial return on investment (ROI). "Business value can be measured in other ways than just financial," he explained.
Murphy proposes a range of categories for the measurement of the value of IT investment, including risk, supplier relations and customer service.
An infrastructure investment, for example, will have a very low score on a direct-payback measurement, but will score highly, for example, if the company wants closer links with suppliers and customers. If a company's IT is up to date, it will be easier to interface with another company's IT.
Wolfe agrees. "If we wanted to upgrade the infrastructure of a network, we would demonstrate that it would improve employee productivity through a reduction in downtime and improved communication speeds. This would mean that an employee could work faster by one hour a week, or that several hours of downtime a year are eliminated. That has actual value to business in addition to reducing user frustration."
There is also the flipside to consider: the risk of not investing. Being unable to implement new applications because a company is using unsupported software can cripple its responsiveness to market opportunities. Being left behind means that catching up is inevitably much more painful.
But investment in IT should not only have approval from senior managers - all end-users in the organisation should be equally convinced.
"We have produced Macromedia Flash presentations as commercials for our own projects," said Wolfe. "The result was interest and excitement because of the use of online technology and Q&As for a new application. Our customers can see that we are already using new technology to run our business more efficiently."
However, this advice comes with a warning: do not talk IT-speak to business. "Do not talk about release levels. You must speak in a business language and not send people to sleep because you are spouting gobbledegook. Explain how the technology converts to business measures," Wolfe said.
The task of convincing board members of the value of a technology they may regard as eye-glazingly arcane is made far easier, said Murphy, if the company already has an IT council, an IT investment board or an office of architecture and standards. Such bodies already have a thorough understanding of how and why IT can deliver to business and should be able to take tough sells, such as system software upgrades, in their stride.
Perhaps the most important way to win hearts and minds is for IT to have established an excellent track record for all its deliverables. If business has a good relationship with IT, said Murphy, it will trust IT to make the right call.
Selling to a non-technical audience
- Analyse the "before and after" contribution to a measurable business value, such as through employee productivity
- Use balanced scorecards with metrics for technology investment that business can buy into, such as activity-based costings. This can show how, for example, faster bandwidth speeds up business
- Ensure an infrastructure investment depends on a new business application that will deliver clear business benefits
- Highlight the cost of not investing, such as being unable to bring in new applications that are dependent on the latest system software, or the increased cost of maintaining ageing software
- Develop IT marketing skills. The products and services should be able to sell themselves in a language users understand
- Bring in external, neutral experts who are experienced in justifying technology investment and identifying benefits
- Setting up joint IT/business bodies, such as an IT investment board skilled in understanding the pros and cons of a technology investment will give confidence to the rest of the business.