I often meet with businesses to discuss technology. And although there seems to be some connection on the use of technology for strategic purposes, it doesn’t seem to change the business owners view on what “I.T.” should be for their organization. I specifically say business owners, because in a number of cases the COO, or operations folks, absolutely get it. Mostly because they are directly responsible for the results and immersed in the day to day behaviors and pulse of the company. So they understand how technology directly impacts performance, confidence, engagement, and profit.
But there is still a disconnect at the very top that is reminiscent of views from decades ago. The leadership vs. I.T. mentality. And don’t get me wrong, this is mostly the fault of the I.T. side not connecting to the business drivers of the organization. But regardless, it is an old view. And the reality is, this adverse relationship between I.T. and the business is disappearing in companies embracing tech. Which is why we are now seeing two different types of philosophies emerge, where some view technology as an advantage well worth the investment, and others do everything they can to minimize technology budgets. Although I can understand the origins of the later view, I struggle understanding why it still exists. Isn’t technology the platform on which business is done today? I mean, are there any companies out there that are not dependent on technology to operate? And if they are dependent on technology to operate, wouldn’t the ones that master the advantages of the technology be in the best position to succeed. By comparison, let’s look at something like sales. Companies are definitely dependent on sales to succeed, but I doubt anyone in the world would say if we under invest in sales we’ll be better off? So why is that the approach for some with regards to technology?
Maybe it’s because things like sales have tangible outcomes that are easy to monitor. Sales people have sales quotas. If they hit their numbers they stick around, if they don’t, well unfortunately some still stick around.. but either way there is a very easy way to monitor the relationship between sales and revenue. So maybe there is a belief that technology’s impact on the business can’t be measured.. But is that really the case? If that were true, investment in technology would be pretty consistent from company to company. But it’s not. Some companies are spending virtually nothing on I.T., while others are spending more every year (63% of CIO’s raised I.T. budget again in 2018)
So what do some people know that others do not? How are some companies integrating technology into the business, and what are they using it for? In my view, I think it’s important to start with one of the most basic requirements of a successful business; maintaining competitive advantage. This should be a strategic goal for all companies. Creating an advantage that makes it difficult for competition to win business, while generating a good profit at the same time? So, if this is a strategic goal for the company, by extension it should be a goal for all of the departments within the company, right? Even I.T…
So what drives competitive advantage? how does a company move into a position where they have control of their industry from a product standpoint, while creating leverage over their competition? How do you make it difficult for others to win business in good times, and how to you apply pressure to the competition in bad times? Isn’t that what we mean by competitive advantage? To consistently put your self in a position where you can make the very best of the opportunity regardless of competition and short term economic shifts? With this being the end result, what do businesses focus on? There are literally thousands of business strategy books, techniques, theory’s, case studies, and “Best of the Best” type models to address this concept. But aren’t they all the same to a certain extent. Don’t they all boil down to a few important things.. People, Process, Product, and Profit? So wouldn’t it make sense to do everything we can to attack those areas from all angles? Even your technology strategy?
I mean, ultimately we are just trying to accomplish a few key things in each category, and the people and tools we use help dictate our success.
If we look at people we are really talking about a few things:
- Attracting and retaining talent
- Promoting a culture of continuous learning
- Motivating employees to be actively engaged
When we look at process we are talking about:
- Creating a systematic way to reproduce identical results
- Continuously improving those processes
- Managing adherence to the processes.
With product we mean:
- Understanding the wants and needs of your customers
- Understanding trends that influence your target customers
- Understanding market shifts and opportunities
- Managing product / service changes and time to market processes
- Go-to-market strategy (leader, fast-follower)
And with Profit it’s really about:
- Reduction and elimination of waste (time, resources, material)
- Increased productivity
- Increased efficiency
- Creating redundancy and scale
- Increasing profit per person
All of these concepts are pretty straight forward, yet some companies execute flawlessly on them, and some struggle to move anything forward. I think that is the big difference that separates the tech investors vs. the cost cutters. Some companies are using technology to drive competitive advantage, while others are trying to address these items independently of their tech strategy. Some companies have a strategy for each bullet on this list, and a set of technology tools to help them move forward, while others are trying to manage it all through older means. And some companies have made room for technology conversations at the strategic table, while others leave I.T. out of the meetings. I can say seeing both strategies in action, and knowing first hand how vital leveraging technology can be, I know the company I would invest my time and money with. Maybe it’s time all of us change our view on the role technology should have in our businesses.