Whether it is getting colleagues in the line to invest in a new business intelligence tool or take on a vendor to provide cloud-based storage, the one thing that is essential for faster decision-making is a persuasive business case.
Unfortunately, many IT managers still focus too much on the numbers — net present value, payback period, and so on — to demonstrate why what’s spent will be repaid so many times over. This tends to stem from a desire to put everything into “business language” in a bid to appear credible. The problem is that, more often than not, they then let this lead them into making questionable assumptions that set the stage for tangential discussions and, ultimately, the loss of far more credibility than if they hadn’t tried to crowbar spurious calculations into their argument.
This emphasis on financial value also leads line managers to focus on capturing financial benefits during implementation of the initiative (for instance, by disproportionally focusing on keeping costs low), often at the expense of any longer-term benefits the investment offers. And as making good IT decisions becomes such a crucial part of the digitization trend sweeping through the world’s companies, this could lead to firm’s missing out on some big opportunities.
Five Steps to Take
Instead of relying on financial analysis to carry you home, build a compelling five-part narrative, highlighting the need for investment.
Here’s what’s changing: Describe the relevant changes outside and inside the firm – disruptive technology, new cost pressures, innovative business models, and so on – that are behind why the investment is being made, and how it will help the company prosper.
Here’s how our peers are solving this problem or capitalizing on the opportunity: Tackle criticism and concerns from colleagues, as well as possible cynicism, about the proposed technology investment by showcasing proof-of-concepts (PoCs) and case studies sourced from secondary resources or your own professional networks.
Here’s what we need to do and why it’s important: Succinctly describe the investment and its objectives. Pre-empt stakeholder concerns about the investment’s alignment with business and IT strategy by showing how the benefits of the investment will boost key strategic and operational metrics from enterprise or IT dashboards, and by showcasing how the investment aligns with the firm’s technology strategy.
Here’s how we are prepared to run with this: Clearly communicate the key capabilities required for making a success of the investment, and the extent to which they already exist within the company.
For missing capabilities, estimate the cost of acquiring or building them. This helps set aside concerns about how feasible it is to implement the investment.
Here’s how we’ll ensure a smooth implementation: First, anticipate the biggest risks of the investment, such as the change management required and the impact of system downtime. An important cause of people overestimating the success of a new investment is a poor understanding of risks it exposes teams and companies to.
Then, outline specific mitigation strategies to set aside concerns of possible implementation derailment.