What Business Really Wants From IT This page intentionally left blank What Business Really Wants From IT A Collaborative Guide for Business Directors and CIOs Terry White AMSTERDAM BOSTON HEIDELBERG LONDON NEW YORK OXFORD PARIS SAN DIEGO SAN FRANCISCO SINGAPORE SYDNEY TOKYO Elsevier Butterworth-Heinemann Linacre House, Jordan Hill, Oxford OX2 8DP 30 Corporate Drive, Burlington, MA01803 First published 2004 Copyright © 2004, Terry White. All rights reserved The right of Terry White to be identified as the author of this work has been asserted in accordance with the Copyright, Designs and Patents Act 1988 No part of this publication may be reproduced in any material form (including photocopying or storing in any medium by electronic means and whether or not transiently or incidentally to some other use of this publication) without the written permission of the copyright holder except in accordance with the provisions of the Copyright, Designs and Patents Act 1988 or under the terms of a licence issued by the Copyright Licensing Agency Ltd, 90 Tottenham Court Road, London, England W1T 4LP. Applications for the copyright holder’s written permission to reproduce any part of this publication should be addressed to the publisher Permissions may be sought directly from Elsevier’s Science and Technology Rights Department in Oxford, UK: phone: ((cid:2)44) (0) 1865 843830; fax:((cid:2)44) (0) 1865 853333; e-mail: [email protected]. You may also complete your request on-line via the Elsevier Science homepage (www.elsevier.com), by selecting ‘Customer Support’ and then ‘Obtaining Permissions’. British Library Cataloguing in Publication Data White, Terry, 1956– What business really wants from IT: a collaborative guide for senior business and IT managers. – (Computer Weekly professional series) 1. Information technology – Management 2. Information resources management I. Title 658(cid:3).05 ISBN 0 7506 60961 For information on all Elsevier Butterworth-Heinemann publications visit our website at: http://books.elsevier.com Composition by Charon Tec Pvt. Ltd, Chennai, India www.charontec.com Printed and bound in Great Britain by Biddles Ltd., Kings Lynn Contents Computer WeeklyProfessional Series ix Preface: What do all these people do in IT? xi 1 There is no ‘F’in IT 1 Move over the librarians 4 Where’s the ‘F’ in IT? 6 Never mind the ball, get on with the game 7 IT people are IT people 8 When good words go bad 10 Peddaling your bicycle faster won’t make it into a car 13 2 The three roles of IT in organizations 14 Introduction to the momentum line 14 Maintain business momentum 16 Improve business results 17 Provide aligned leadership 18 3 The new business-IT agenda 24 Remind me again why we outsourced! 24 Supply and demand 27 IT demand management – three roles 30 The three roles expanded 31 Everything filters through 34 The focus changes 35 If you’re going to do something, try to have a reason 36 for it Real IT performance 37 v Contents 4 Managing technology to maintain business 39 momentum – the first pillar of IT performance Why manage IT (as against doingIT)? 41 IT availability and stability 42 Operations and efficiency 45 Management of IT services benefits 45 Asset management 46 Performance, measurement and reporting 48 Supporting business momentum 49 Activities of an MBM manager 49 5 Managing business results from an IT 52 perspective – new rules, new challenges The unique unused gifts that IT people bring to the 54 organization Developing the business case and accompanying 55 benefits statement Achieving the benefits promised in the benefits 58 statement Business measures 61 Process management 63 Information content 64 The real life cycle of systems 65 Portfolio management 69 Step changing business 73 6 Information leadership in the information age 74 The reluctant technologist 75 Interpreting the external inputs 77 Internal influence and leadership activities – 83 translating inputs into meaning and action within the organization The hard stuff is easy, the soft stuff is hard 91 7 Amatter of survival – proving the benefits of IT 93 What happens to costs and benefits over time? 95 The benefits process 99 Keeping it simple 114 8 Getting, keeping and using the cash – budgeting for IT 116 Back to the momentum of the business 116 Three types of IT activity mean three types of budget 120 9 Measures of IT – some principles of measurement 125 Measures must be linked to objectives 126 Measures must be understandable to the business 126 vi Contents Measures must be communicated 127 Measures must result in something – they must have 128 a reason to exist Three IT roles equals three measurement frameworks 128 Measuring the performance of technology 129 Measuring improved business results brought about 131 by the application of information technologies Measuring IT leadership 133 Implementing measures 134 Communicating to the business 138 10 New IT skills and people 139 New skills for the three roles 139 IT supply skills 142 Maintain business momentum (MBM) skills 143 Improve business results (IBR) skills 145 Information leadership (IL) skills 146 11 Applying the model – check your mindset at the 148 door What changes? 148 Governance – three types of meeting: MBM, IBR, 151 and IL Focus on business benefits 154 IT’s survival depends on measurement and reporting 155 Playing the three role game 156 People 157 12 To boldly go… 158 An implementation plan 158 Impact analysis 159 Syndication 166 IT supply and demand 168 Organization changes 170 Strategy 171 ILstrategy 174 Putting the implementation plan together 175 13 In the beginning 176 Bibliography 178 Index 181 vii This page intentionally left blank Computer Weekly Professional Series There are few professions which require as much continuous updating as that of the IS executive. Not only does the hardware and software scene change relentlessly, but also ideas about the actual management of the IS function are being continuously modified, updated and changed. Thus keeping abreast of what is going on is really a major task. The Elsevier Butterworth-Heinemann–Computer WeeklyProfes- sional Series has been created to assist IS executives keep up to date with the management ideas and issues of which they need to be aware. One of the key objectives of the series is to reduce the time it takes for leading edge management ideas to move from the aca- demic and consulting environments into the hands of the IT practitioner. Thus this series employs appropriate technology to speed up the publishing process. Where appropriate some books are supported by CD-ROM or by additional information or templates located on the Web. This series provides IT professionals with an opportunity to build up a bookcase of easily accessible, but detailed informa- tion on the important issues that they need to be aware of to successfully perform their jobs. This book is also relevant to both the IT professional and the business user of IT systems. Aspiring or already established authors are invited to get in touch with me directly if they would like to be published in this series. Dr Dan Remenyi Series Editor [email protected] ix