This section includes processes to manage the business relationship, including understanding the business, marketing IT offerings, satisfaction management, and metrics management. This section outlines specific cost reduction opportunities in these processes.
Understanding the Business
When working with the governance process, IT should challenge the business projects to ensure that requested IT investments result in quantifiable benefits and to verify alignment with the strategies and priorities. However, to do that effectively, IT must understand the business and have a good relationship with it. Many organizations do this by having liaisons, relationship managers, IT partners, account managers, or analysts for the business. These individuals are responsible for managing the business and IT relationship and are passionate about it. They proactively help the business determine how to use technology and participate in process re-engineering. They know their industry, participate in departmental meetings to understand their challenges, and speak the language. This close relationship will ensure that technology investments are in alignment with the business and will reduce wasted costs on projects that begin but are cancelled, or on projects that are completed but do not deliver the anticipated benefits. This level of involvement will improve IT s credibility and IT will be perceived as a true business partner.
Many popular IT strategic planning methodologies tout alignment with the business. It is only with this deep and thorough understanding of the business that IT is able to go beyond alignment to becoming a transformational leader and business strategist that helps use technology for innovation and differentiation in the marketplace. This knowledge will ensure IT investments are the most effective.
Marketing IT
IT must continually market and communicate the services and products available to the business. Only by using the tools and technology will the business realize the most value and payback from investments. The more individuals that use the tools and functionality, the less the unit cost of the functionality. There is nothing more discouraging than having a company invest millions of dollars in a Customer Relationship Management system, then having only one or two power users actually use the technology. As mentioned earlier, most companies only use a small portion of the functionality provided in monolithic Enterprise Resource Planning and other enterprise systems. Continual training and education will increase the use of systems and return on investments. New employee training should provide an overview of all IT capabilities, policies, and procedures so they are aware of tools to make their jobs easier. Monthly status reports, Intranet sites, and other presentations inform all areas of the business of IT activities and tools. Several companies mentioned wasted efforts and money due to a lack of communication, where one part of the business was investing in technology while another business unit was investing in another similar technology, which created duplicate functionality and excess costs.
Top Tip: Communication
"Communication must be robust in good times so you can leverage it in tough times. We have an online newsletter every two weeks for communication. We have team lunches on a regular basis to talk and listen to concerns."
—Hank Zupnick
GE Com Real Estate
GE Com Real Estate
Satisfaction Management
In times of cost reduction, be sure to communicate changes and level-set expectations of changes that the business should expect in service levels, support, or services. When reducing costs, it is important to ensure that the service and value you provide to the business does not decrease, or does not decrease more than planned. Having documented and agreed-upon service level agreements, as mentioned earlier, will help in communicating changes in services or expectations. Ensure you provide proper communication if service decreases are planned. People are far more tolerant of lower service levels if they understand the cost savings that are driving the changes. Conduct regular surveys that measure the user satisfaction with IT. Ensure cost reductions do not affect satisfaction too deeply or you may need to take appropriate action to shift costs.
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