No Cio Big Problem

Writen by Ron Maddox

You run a small business, which you have built with the resources you have garnered over time. Precious capital is leveraged as investment dollars to maintain and upgrade your business processes. And you have IT! IT is usually involved in business processes ranging from finance, payroll, HR, POS systems, inventory control, procurement, and so on… The typical small business owner does not have expertise across these domains and usually outsource most. Still, the small business IT department will continue to grow over time. It is a natural phenomena, like hurricanes.

First, desktops are everywhere. Then you own a server! SERVER! As one of my clients remarked, I own a server! He was not sure why, but he owned one. One became three and he needed a computer room. And more importantly, he got stuck with of the total cost of ownership of that growing IT infrastructure with no concept of Return on Investment (ROI) or the true beneficial or negative impact of that IT spend on the overall performance of his business processes.

It is a common story for small and large corporations alike. Fortune 500 companies are struggling to get a business handle on their IT situation and the usual answer is clamping down the IT bleed with strict ROI analysis and central governance control over their growing IT budgets.

Small companies that do not have a legitimate CIO to spearhead these control efforts is at a distinct disadvantage. A CIO first "learns" the specific business processes that are in place. Then he takes a hard look at the hardware and application landscape. Is it operating under a coherent architecture? How does the architecture map to existing business processes? Is there a strategic action plan for the company? Does the architecture roadmap align with the strategic objectives? Next, the really hard part, governance. The CIO should establish governance and controls at the architecture level that will ensure alignment of the IT roadmap with the strategic direction of the company.

Now we get down to the margins, which is reducing the IT spend and the associated growth in yearly IT spend. ROI as a concept is taught to the IT managers. Bleeds of investment capital not directly related to supporting ongoing operations, the IT roadmap or the strategic plan arrives DOA on the CIO's desk.

In truth, not many small organizations with fewer than 500 people actually know what the total spend on IT is and what the ROI on that spend nets out as. The hidden costs of IT are rarely brought together in one spreadsheet and evaluated against business processes.

What can be done? Shop for a CIO that can perform the tasks described above. Give him goals. Step back! A CIO needs to be half business man, and half technocrat. A foot in both worlds! Only then can your precious investment and operations dollars be leveraged effectively and your new focused IT can start to help drive your strategic goal.

View http://www.yorkwebtek.com for more information concerning leveraging IT for your business. http://www.crazytowndeals.com is an example of a complex client facing web site that has more than 4 times the code behind the scenes that supports the site operations.