06/26/2020
By
Marcelo Egypto

Information Technology and strategic decisions: start giving your IT a voice now

In times of crisis and the migration to a 100% digital business model, IT needs – more than ever – to become the strategic key.

It is no longer a matter of choice. It is urgent: technology is decisive in company health and in the future of business. Even more so in the times of crisis that we live in, where the global pandemic, social isolation and home office pushed corporations into the remote transition.

This is the reflection that we bring in this article. Read on to understand why strategic IT is a game changer for organizations, what it’s pillars are, and how to implement it effectively!

Strategic IT: the key turning point

In addition to meeting the traditional requirements for process and communication integration, Information Technology is considered a factor of innovation throughout the company.

In the times of crisis we are experiencing, Digital Transformation has ceased to be an innovation and has become the only possible way for companies to continue existing. And anyone who wants to succeed in this endeavor needs to involve IT in their strategic decisions.

Whoever stepped up and automated their existing business processes came out ahead. RPA is one of the solutions that can help a lot, even more in remote times, because the robotic process automation increases business competitiveness.

This is an external process, disconnected from the company’s’ own will; it comes from the market itself, from the complexity and dynamics of the business ecosystem, nationally and internationally.

It is in this context that the concept of strategic IT needs to be considered. It describes how technology should be used to meet IT and business goals.

NOTE! Also called a technological strategy (or IT / technology strategic plan), the IT strategy must be something that is formalized and documented. This is so the multiple factors that affect the organization’s investment and use of technology are clear to everyone involved in the process.

Pillars of strategic IT

A company has strategic IT when it is able to control all facets of technology management, such as:

  • Costs
  • Human capital
  • Hardware and software administration
  • Providers
  • Risks

To understand the power of strategic IT, let’s list the main pillars that support it.

Governance

IT governance is about making smart choices in allocating scarce technological resources and being responsible for the performance resulting from those decisions. These options include those that consider cost, risk and strategic alignment.

Although governance almost always exists in some way – that is, without being explicit – the maturity and predictability of the process are achieved only with clearly defined, understood and agreed upon governance procedures.

→ Read also: Data governance: why and how to implement it?

Resources

Resource management involves understanding the planning tools and processes to achieve specific goals while putting efforts into the broader context of strategic initiatives.

This pillar includes skills in:

  • Planning
  • Project and budget management
  • Information management
  • Change management
  • Performance evaluation of the IT area

Intelligent infrastructure

As systems become increasingly interdependent and a small change to an application can have significant downstream impacts, it is no longer possible to have a single, narrow view of the solution’s development. New requests must be handled with an end-to-end process mentality.

At this point, the introduction of new features will require an architectural perspective that considers qualities such as:

  • Reuse
  • Standards
  • Sustainability
  • Use of data

In the medium and long term, intelligent infrastructure can lead to high quality solutions and reduced overall costs.

Software and hardware

Historically, many organizations have created and hosted their software and hardware solutions or purchased them from third parties in an implementation modeled on their own infrastructure. Even today, there are good reasons to do this, especially with systems that use proprietary innovation and are essential for differentiating your product within the market.

Outside of this category, IT has become increasingly commoditized – that is, basic services do not offer a competitive advantage, but are essential for key business functions (think of email or file storage as examples).

The use of more commodity-based IT products and services allows the organization to re-elevate its value proposition: working on the most complex business problems and being a true facilitator of business growth.

It is within this context that cloud computing has become a fundamental ally. It helps to reduce overall infrastructure costs and ensures information security, scalability, and mobility, among other benefits. In addition, it enables companies of all sizes to finally envision truly strategic IT.

Strategic leadership and teams

The execution of an IT strategy requires strong leadership. Typically, the CIO and CTO need to work closely with the business, budget and legal departments, as well as with other lines of business and user groups to achieve success.

Likewise, the IT team needs to focus on more analytical and less operational performance, since it can delegate operational issues to specialized service providers.

To do this, you need to be empowered and gather skills related to the business world. Only then will it cease to be a mere support and start bringing strategic and innovative solutions that positively impact the entire organization.

Why implement the new IT

Strategic IT has become a central component of value creation and will continue to evolve from its support function to the company’s core processes. Rather than supporting existing business models, it has become an essential source of ideas for completely new business models.

A strong example is the principle of the platform economy that was created by digitization – or at least radically renewed. This principle completely changed the way music is sold, how hotels occupy their beds, how department stores work (see the Amazon model), to name just a few fronts that are already quite visible to the general public.

Entrepreneurs and business managers who wish to succeed in this Digital Transformation environment are invited to involve IT more in organizational and portfolio development. For IT departments, this also means a fundamental change in the way they operate.

The continued evolution of IT into a needs-based service provider, rather than pure technology, needs to take the next evolutionary step. The provision compatible with the agreed service level is only part of its tasks. In addition, IT is expected to live up to its role as a provider of ideas in real business.

If IT really wants to deal creatively with new business ideas in the future, like service innovation, this requires basic mastery, such as the reliable and economical delivery of agreed services and the implementation of new and changed requirements.

To do this, IT must first know in detail the current business processes, activities, and what services are needed for it to function. It also needs to be directly connected to the company’s business and the markets in which it operates.

At the same time, the importance of IT for production will continue to increase, creating new challenges for the development of systems related to the machine and its safe operation.

What is the level of IT maturity in your company?

You have read this far and you are certainly wondering how mature your company’s IT strategy is right now. If so, know that you are on the right path, as the first step is to become aware and from there, work to make things even more strategic.

Here at MJV, we have helped companies in varied market segments to take the right steps towards strategic IT. So much so that we developed a tool that helps to verify the level of technological maturity in organizations.

How about it, what did you think of the ideas that we brought in this text? Feel free to contact us for a [virtual] coffee to talk about how we can help you design and execute a more strategic and result oriented IT department!

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