Exercise, It’s Good for You: IT Investment Strategy

The most important idea about Information Technology (IT) strategy is to think of it as an exercise, not a document:

  • It isn’t: “we must complete an IT strategy document because all well-run IT departments have one.”
  • Rather, it’s: “we ought to complete the IT strategy exercise because it sparks the discussions and analysis that are essential to being a well-run enterprise.”

The exercise itself is what matters; the document is merely the output. A good IT strategy will ensure a common understanding among business and IT leaders as to how IT relates to – and supports the success of – the business. And yet, fewer than one third of IT leaders report that their organizations are effective or very effective at IT strategy and planning, according to Gartner’s 2017 CIO Survey.

“Thriving in the Digital Age” Is a Moving Target

Businesses rely on information technology to drive down costs, improve customer relationships, and invent new models of business. Businesses also recognize that data and systems are assets that need protecting in an ongoing arms race between cybercrime and cybersecurity. These realities underscore the centrality of IT to any business’ success and survival, and likewise, the criticality of a solid strategy for IT investment. IT leaders should not be alone in technology investment planning; eliciting the full engagement of peers in the business units – and full support from senior executives – is essential for devising an IT strategy that has real meaning and utility for governance.

Because this is so, it’s critical that IT leaders be very confident in their understanding of the business’ strategy, and how future technology investments relate to that. It’s possible that no one in your organization is maintaining a business strategy, or that bits of it are siloed within functions. Great!: viewing this lack in a positive light, your IT strategy just became even more valuable to the organization. The conversations necessary to IT investment planning will elicit elements of business strategy from the stakeholders, and provide the missing forum for them to get clear with each other, as well as with IT.

How to Get It Done

It’s generally up to CIOs to guide development of IT strategy.

  1. Start with ensuring senior leaders are supportive of the exercise and the approach.
  2. Engage with business leaders to understand their initiatives, pain points, and other priorities.
  3. Enlist your enterprise architects to document IT assets presently in place, including infrastructure, applications, and services, to create a comprehensive picture of current holdings. It’s helpful to include diagrams of the architecture, accompanied by narrative, so these artifacts can stand alone as a reference.
  4. Enlist your IT operations and security experts to understand challenges, developments, and insights for these areas.
  5. With all the foregoing stakeholders, analyze strengths, weaknesses, opportunities and risks. Identify what needs replacing, enhancing, or repairing. Use this information to determine goals for IT’s future state, three to five years out.
  6. Identify in broad strokes the approach that will take the organization from the current state to the future state.
    • Carve off part of this plan (12-18 months) to detail what you’ll accomplish in the near term. This might be a Gantt view of the IT Project Roadmap, if you already have it. If not, seek guidance on how to create one.
    • Consider what resources (technology, expertise) are missing to accomplish the future state.
    • Identify costs for these actions to arrive at budget projections for these efforts.
  7. Include in these exercises defining the governance to keep the IT strategy fresh and relevant.
    • Who will be included in strategy reviews? This is the opportunity to create a forum for business leaders and IT to exchange views about how IT can better serve the business.
    • How frequently will you meet? Bear in mind how dynamic the business and technical environments are, and meet with sufficient (and regular) frequency to keep the IT nimble.
  8. Build in measurement.
    • How will success be measured?
    • What artifacts will enable management and other stakeholders to evaluate progress against the IT strategy?
    • How frequently will those artifacts be updated and circulated?
    • Whose responsibility is it to produce these dashboards or reports?
    • Ideally, achievement of IT strategy goals will be incorporated into performance plans.

There is ample guidance online for what topics an IT strategy should cover, and how to organize one. These are more alike than different, which is reassuring. It also means you’ll have no trouble identifying the structure that suits your organization best.

IT *Investment* Strategy

If nomenclature is important, then you may want to guide your organization toward thinking of this exercise as IT investment strategy. Talking about money has a wonderful way of focusing people’s attention, and using “investment” conveys that your strategy involves – and organizes – the spending of money… and the anticipation of a good return.