Business Value of IT

♪ Music and computer generated beeping ♪ When we talk about the business value of IT at Gartner we're talking about how CIOs deliver and communicate about value in the enterprise. CIOs have to focus on delivering value in business terms alone. The value of IT is measured in two ways: first in terms of price for performance, and what we're talking about here is what it costs for IT to support a certain level of Enterprise performance. The second way IT's value is measured is as a component of investment in change; uh, as one of the imports to a change in enterprise performance. And the outcomes here are measured in someone else's P&L not in the ITs budget. At this particular point in time there's been a number organizations that have gone though difficult times and as a result, uh, a lot of the cost cutting that IT organizations did, many leaders have begun to question 'Do we really need all that IT investment to begin with?' CEOs and CFOs are asking tough questions of CIOs. In particular, they're asking am I spending the right amount on IT How do I know when I'm spending the right amount on IT? How do I know that the IT you're providing is the IT I need? And you can't answer those questions without focusing on the business outcomes in business performance that IT produces. The biggest challenge that many CIOs face when discussing the business value of IT is that often times their leaders in the organization don't really understand IT to begin with. So to try and describe the value of IT, it has to be done in business terms not in IT terms. The most important thing I can tell CIOs about creating and communicating value with IT, is that it's never about the machines it's always about the performance the people using the machines. IT professionals grow up in an environment where the machines matter a lot. And IT professionals can talk about what the machines are doing all day long, but that's not where the value is; and the first thing that any IT professional needs to do when they're thinking about communicating with the rest of the Enterprise about value, is to stop talking about what the machines are doing and start talking about what the people in the Enterprise are doing with the machines. ♪ Music and computer generated beeping ♪