As they steer their companies forward, business owners should take a close look at their information technology opportunities and challenges.
Traditionally, businesses will make time for financial audits or sometimes go down the path of valuations.
And yet, they often overlook the current and future impact of the technology they use.
An IT audit can uncover issues and give companies an opportunity to address problems. At the same time, a comprehensive assessment can often help businesses identify steps they can take to cut costs and use technology to support a strategic growth strategy.
Some companies may have a general vision or strategy for IT, but they haven’t determined how to quantify the costs or timeframe they will need to deploy the latest technology. Unfortunately, executives often don’t know what possible or affordable.
Executives often have a tough time getting their hands around IT even when they commit money. Worldwide, IT spending is expected to reach $3.6 trillion, according to Gartner, a leading information technology research and advisory company.
Gartner captured executives’ IT experience in the “CEO Survey 2012: The Year of Living Hesitantly” report.
Here is a summary:
“The difficulty with investing in newer technologies for strategic outcomes is that organizations need the right kinds of leadership and change management. Many business leaders learned the hard way in the 1990s and 2000s that simply buying and installing technology doesn’t deliver results if it’s not carefully directed and delivered in conjunction with coordinated changes to policies, processes, organization, roles and culture.”
In a practical sense, an IT audit can help companies define their short, mid-range and long-term strategies. It’s important to have a handle on each type of strategy in view of financial forecasts as well as existing and future resources.
A short-term strategy can involve a project as simple as transitioning employees to a new e-mail system.
For a mid-range project, a company may decide to have all of its sales reps use tablets and be able to access inventory as well as backend systems. But the planning and transition could take place over a couple of years.
Long-term strategies could involve technology related to an expanded global presence or a decision to eliminate an in-house data center in favor of an off-site provider.
Regardless of the strategic timeline, companies should make sure they have internal IT experts or outside consultants who can successfully manage IT plans in a wide range of settings – from the c-suite to technicians who troubleshoot specific problems.
Sometimes technical employees may know a type of technology inside and out, but they may lack the experience or skills to effectively discuss technology needs with top executives.
Seasoned IT professionals will be comfortable in any setting and be able to use relevant language for presentations. In a sense they would be IT geeks who speak English.
Companies fall short when they fail to see how an IT strategy fits within the overall direction of a business. It’s not uncommon for executives to look at IT in terms of physical equipment or repairs when something goes wrong.
It’s important to explore everything to determine what makes the most sense for the business, including the efficiencies that come with virtual servers and disaster recovery plans. For example, it’s not simply a matter of backing up the data. Companies need to establish protocols for recoverability (steps they will take to recover the data). Through replication, the data can be continuously copied on a separate set of servers (e.g. documents and e-mail). Some companies even invest in Dropbox, which makes it possible for the data to be recovered quickly.
Some industries do incorporate IT into overall business plans. Insurance, banks and different types of financial services companies use technology to their advantage. They’re always looking for ways to provide more value to their customers (external and internal). They try to gain a competitive advantage by relying on solutions that ensure products and services are delivered as quickly as possible.
Retailers and health care systems have been slower to respond.
For example, hospitals with money to spend were more likely to invest in MRI machines, not IT.
But that’s changing – in major ways. Saddled with disparate systems, hospitals are looking for ways to connect systems in different divisions (e.g. oncology and pediatrics) so they “talk to each other.” As it stands, hospital employees must spend time logging on and off several systems. The inefficiencies can be addressed in part with Kerberos (a computer network authentication protocol) and single sign on options through the Lightweight Directory Access Protocol (LDAP).
With IT audits, businesses should expect outside consultants to ask many questions and be thorough.
Audits are especially helpful because c-suite executives sometimes have a limited or rosy view of how their IT is performing. After all, they depend on the high level summaries they get from IT representatives who will naturally want to present the best picture possible.
For example, with a data center relocation, the best consultants will shine a powerful spotlight and evaluate current conditions. In that process, they may uncover some long neglected problems, including servers that weren’t configured properly or simply aren’t performing as well as they could.
Without an IT strategy (supported by a comprehensive audit), companies will get by with a “business as usual” mentality. As owners and top executives look at their profits, they will be left to wonder: “What more could I be doing?”
From an IT perspective, companies should look beyond tackling one task or a project at a time and determine how current and new technologies can best help them achieve their business goals. Taking the time to shape a strategy can make a huge difference and improve a company’s bottom line.