At a recent executive summit, I presented a historical perspective of IT spend layered across our enterprise business capabilities. The story was consistent; technology investment drives significant business results. There was a direct connection between IT focus and business outcomes. The relationship highlighted the importance of being aligned with strategic needs and underscored the CIO as not only the Chief Information Officer but more importantly the company’s Chief Investment Officer for technology.
Technology investments make or break your enterprise and IT is at the front lines on every technology investment decisions. These investments drive and enable enterprise aspirations for scale, growth and value creation. But how does he/she know which investment and resource allocation maximize business return?
To maximize outcomes, CIO’s rely on top-down and bottom-up investment approaches. Top-down is understanding enterprise long term strategic intent. This approach ensures business alignment and leadership commitment--key attributes required for success. Bottom-up analysis involves the introduction of new ideas involving transformational technology that can ultimately drive strategic change within the company. Your organization, leadership teams and metrics must align to these two methods. Portfolio management decisions must also avoid the trap of uniform distribution. In short, the Chief Investment Officer-Technology runs his portfolio like a business.
Every enterprise has a strategy. Some are easy to define and follow while others are less obvious and can only be derived from actions and culture. Regardless of strategic planning rigor, it is the CIO’s responsibilityto know where the enterprise is placing big bets. Strategic alignment is all about the ‘what’—ensuring you’re investing in the right things. Technology investments and IT resource allocation are driven by knowing where the enterprise wants to win. Without this understanding, IT wastes capital and resources on misdirected non-value initiatives losing a competitive advantage.
For the CIO to invest properly we must be an active listener. We need to digest feedback, engage pro-actively and connect with our business peers. At The Pasha Group, quarterly executive meetings are not only an opportunity to learn about strategy and planning but to connect and build relationships with other leaders.