Business value is the key to IT manager job security

I just finished writing an article for Cutter Consortium’s IT Trends for 2012, , , an annual survey and review they do every year. This will be my fourth year to do this.

Cutter polls their subscribers with an annual Technology Trends Survey and has two people along with their senior editor review the results and write an analysis. They include an academic and an operational IT manager.

In the academic case, it is Dennis A. Adams, Associate Professor of Decision and Information Sciences at the University of Houston.

The operational IT manager perspective is where I come in.

When I started writing these articles it was the beginning of 2009 and much has happened since then. One of the nice things we receive in the survey feedback data is an ability to see how managers answered questions over time, , , in other words, we can see the trend.

In 2009, IT organizations were anticipating layoffs and downsizing. So, when I wrote a newsletter article about “Business value is the key to job security”, it was geared to the downsizing momentum that existed in 2009.

In reviewing the 2012 survey data most IT organizations believe their staffing situation is stable or they are going to be hiring this year. I’ve seen this consistently in many articles and surveys over the past year.

So, why do I rewrite the article when hiring seems to be the trend versus downsizing?

The reason is simple, , , no matter what your situation, business value is absolutely key to your success.

If your organization does not know how to identify and deliver business value, your success is going to be limited.

This article is not intended to make you worry needlessly or to be a negative message.  In fact, the message you should get from the content below is a very positive one.

In today’s business environment, it is more important to have an IT organization that is appreciated and valued by your senior management team than ever, , , and it is ultimately essential for your viability in the company.

It’s never too late to start building a presence where you and your IT organization are appreciated and valued for what you do, , , so if it doesn’t already exist in your company, you need to get started RIGHT NOW !!

First step – understand the importance of business value.

Business managers want and need your IT help, but they do not and will not fully understand technology. There are exceptions to everything, but for the most part they don’t want to understand the technology. They just want to do their jobs and to support the company’s mission, , , and they want you to do your job.

What business managers (senior managers and department managers of your company) do understand is business value.

When you deliver business value, speak in business value terms, and do things that have business value benefits, , , then and only then do you get their attention. You also gain their respect and appreciation for your organization’s hard work because they better understand what it is you are achieving.

However, if you do not connect with your client (again, senior managers and department managers of your company) on a business value level, it is difficult and potentially impossible to gain their respect for what you and your organization do.

They just don’t get it when you deliver technology and talk technology.

It’s about the business. It is not about the technology.

Business value comes in many forms:

A.  Increase revenue  –  Implementing technology that helps the company sell more of its existing products or services or sell new products or services.

B.  Decrease expense  –  Decreasing a departmen’s expenses or avoiding costs by implementing technology.

C.  Improve productivity  –  Improving a department’s employee productivity so they can handle more work with existing employees and avoid hiring more employees or they are able to reduce staff.

D.  Differentiate the company  –  Doing something that gives the company an advantage over its competition by differentiating the company’s offerings.

E.  Improve client satisfaction  –  Retaining a client can be more cost effective than replacing a lost client with a new one. Improving client satisfaction can be valuable to a company.

In a “for-profit” company, there is a common theme in all of these elements. Each of these value propositions help the company become more profitable, , , and profitability is the name of the game in a “for-profit” company.

Even in a “not-for-profit” company increasing revenue, decreasing expense, improving productivity, etc. are important to help the company continue to operate and do the work of it’s mission more effectively.

So, regardless of your situation business value is a key component in delivering IT support.

Your IT organization is the one organization in your company that can positively impact every organization or department in the company.

This is real leverage!

There is probably no other organization in your company that offers this much leverage to the senior management team.

The problem is that your senior managers won’t realize this much leverage is right under their noses if your organization has been delivering technology instead of business value.

Understand that most business managers see the IT managers of the company as technical managers, not business managers. In far too many cases, they don’t think their IT manager or CIO understands business very well.

You must change this perspective they have of you. And, when you do they will appreciate you and your team for what you can do for the company and not see you as a “cost center”, or a manager who likes new toys and spending lots of money.

An IT manager who delivers business value is viewed as a partner, , , a business partner to be valued for the positive contributions he has made in the past  and can make to the company’s prosperity in the future.

Second step is simple:  All IT initiative recommendations must be cost justified and provide tangible and quantifiable business value to the company.

You simply don’t work on things unless you can quantify the business value that will be gained when the project is completed and every recommendation is cost justified and easily understood by the management team.

This means you must be able to frame projects and discuss them in financial terms. Business managers don’t understand routers and switches, programming, and such technical things as you do; but they do understand revenue, expense, productivity and those type of discussions.

Your tendency is to discuss the issues in technical terms and when you do, you lose a business manager’s attention. Learn to discuss your projects in business value and benefits terms and you get their attention.

Plus, they might even understand what you are talking about.

When senior management trusts you such that everything you do provides business value and that you only spend money prudently (like a business owner would do), you will find they will appreciate your IT organization much more than you might imagine, , , and they want you as their partner.

Let me give you an example, I’ve been very fortunate to have worked with some excellent senior management teams. In my career, I’ve had two CEO’s ask me to spend more money when they were cutting costs in other departments. The reason was the same in both situations, , , these CEOs understood the leverage value of an IT organization that delivers business value.

Insightful senior managers know they can get much more cost savings from IT when we do things that reduces expenses or improves productivity in the bigger organizations.

Sure, if they ask me to cut 10% from my budget in the 2nd half of a year, they will get something fairly tangible cost savings, , , but not nearly what they can get if I can implement technology that improves a large organization’s productivity considerably.

Even better, this type of improvement is usually an ongoing benefit, not a one-time benefit.

You have to earn business management’s confidence. To gain the trust of the business managers requires a third step:

Third step – establish a track record of success where you can show:

1.  All your recommendations are cost justified and have tangible business value

2.  You deliver the approved projects successfully

Sounds pretty simple and it really is when you get right down to it, but so many IT organizations fail to do this.

Business managers are looking for partners who help them achieve their goals and objectives.

When you deliver what you say you will do and the results include specific business value benefits that helps a CEO or Department Manager achieve his/her objectives, you simply gain a lot of respect, trust, and value in their eyes.

They wouldn’t think of running the company without you when this partnership exists.

2 responses to “Business value is the key to IT manager job security

  1. Pingback: Educate senior managers about “IT leverage” | ITLever™

  2. Great. 100% agreed. It’s what, I’m facing frequently in my career.
    Thanks Mike, excellent article.

    Wajahat Rizvi

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