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Developing a New Scorecard for IT

Business and technology managers recognize that IT needs to play a larger role in driving business outcomes and seek new ways to measure success.

New data indicates that agility, speed and innovation are top priorities for today’s corporate leaders, especially as managers work to align business and IT goals.

Those insights come from the 2015 Business Performance Innovation (BPI) Network report “Accelerating Business Transformation Through IT Innovation,” which is based on data from 250 business and technology managers worldwide.

The report shows that 42 percent of respondents believe their companies are embracing new technologies “very well” or “exceptionally well.” And 47 percent say their business groups are devoting more time to understanding the strategic implications of those technologies, including their impact on competitive advantage and customer experience.

Another 47 percent of business and technology managers say the level of innovation is “good” or “very high” within their in-house IT organizations, but 37 percent say their IT groups are only making progress toward innovation. BPI Network offered expert perspectives on the subject:

“Innovation is an often misunderstood and misused term,” said Scott Offermann, Director of Critical Operations at Cushman and Wakefield. He added that “true and incremental innovation is rarely recognized and even more rarely acknowledged.” The fact that nearly half the survey’s respondents said they’re “making progress” supports Offermann’s perception that smaller steps are taking place.

 

That said, many leaders in both the technology and business world think the sluggishness of innovation is more than a matter of perception. For them, it is a reality. “I think it’s real and it’s big,” Tim Chou, an IT lecturer at Stanford University, said after the San Francisco CIO Roundtable. “I would claim right now there is almost no innovation occurring in most corporations.”

Of course, organizational factors can stifle innovation. Forty-four percent of respondents say technology adoption is most hindered by an inability to reach consensus on IT investment decisions. But IT organizations could also be part of the problem: According to the report, 44 percent of managers believe IT still has a ways to go before becoming a strategic, responsive and valued business partner.

“I think the ‘aha’ moment for this was the level of sophistication that the business people have with technology and the utter frustration that they’re showing toward the inability of their IT departments to keep up with innovation,” says Tom Murphy, editorial director of BPI Network.

That may be why proposed business metrics focused not only on more traditional IT measures, such as the reliability, scalability and security of IT infrastructure, but also on innovation and agility indicators. Thirty-eight percent of the managers surveyed believe that companies should rate IT organizations on the ideas they generate to drive business results.

“That’s not something that an IT manager usually thinks about,” Murphy says. “They come to work and think, ‘How many more servers do we need to manage the load?’ But they don’t think, ‘What can I do to help the sales team be more effective in selling its product?’”

To unify business units and IT, Murphy recommends involving IT in strategy discussions from the start.

“The business people don’t often bring them in early enough to explain what it is that they’re looking for,” he says, but early collaboration is the best way to produce results.

“Anything is possible in technology,” he adds, “you just really have to understand what you’re after.”

Bonilla1879/ThinkStock
Aug 13 2015

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