Book Review: IT Savvy
November 30, 2009
I recently finished IT Savvy by Peter Weill, and Jeanne W. Ross. An excellent book, but I actually had to debate writing this review.
Quite simply, this blog is dedicated to you, the hard working executives and managers in the SMB space. And this text is applicable only to the largest SMB’s, with heavy emphasis on the larger enterprise.
That caveat aside, the authors present an excellent prescriptive text on developing a clear, vision forincorporating IT into a businesses strategic planning processes.
The first sections of the text walk through the definition of, and providing examples of, defining your unit operating models, because the linkage between the model and IT is critical. Correctly defining your operating model (ie competing as lowest cost provider, or innovator etc) is critical, because as the authors state;
Information technology does two things well; integration and standardization
This emphasis is placed because it is that precise definition of your operating model that is needed to align the business with the high level requirements of the IT functionality required to support that model. In other words, choosing the wrong IT strategy for a particular model will not provide the benefits you are looking for.
The next section dives into the requirement of applying the correct funding model to your IT investments. As these funding decisions will determine that you are allocating funds to the right places, and for the right reasons, and receiving the appropriate returns. (as the authors state, if your funding decisions are made on the golf course, you have some work to do)
IT funding allocations must be transparent, repeatable and consistent and activity based in their costing formulas.
The next step? Optimizing your IT investment, this is the point where you are digitizing basic business operations, this is the cost reduction stage where you emphasize standard processes or improve data flow. Again depending on your operating model. One key quote I want to pull from this section;
A much tougher piece is the implementation of enterprise process
This is that key warning that applies to business of all sizes; tools such as ERP or POS software are dead last in the people, process then technology equation.
The final sections of the book close off with the critical concept of governance. As simply as it can be put; governance is the mechanisms, roles and formalized process that clarify accountability to fulfill strategic business objectives.
The authors define the following five elements as key in the governance process;
1) IT principles
2) enterprise architecture
3) IT Infrastructure
4) Business needs and project deliverables
5) IT investment & prioritization
And finally – the text closes off with the key leadership attributes needed to drive this change as this quote states; (emphasis original)
No vendor can drive value from IT for you. You can take a partner on an IT Savvy journey with you
Disclosure: Just as anyone that has studied any of the basic sciences can understand the concept the Heisenberg Uncertainty Principle, it takes much more skill to actually use it. And as a manager in smaller SMB’s, this concept is the same for me. Certain of these concepts apply to many smaller businesses, but the actual execution of this in larger enterprises is beyond my pay grade.
Just so you know!