Critical Success Factors for Today’s CIO -- IT Value Part 2: Business Acumen
Business acumen is crucial to understanding the business and balancing priorities.
For most companies, annual autumn budgeting rituals are underway right now. While this time of year is a favorite season for many, in IT it is a pressure-filled quarter: a race to the finish to deliver those commitments due, time to properly utilize approved funding before it disappears with the falling leaves, and a window of time to assess and renegotiate many technology vendor agreements - there is a lot going on.
Where does this leave the CIO who is preparing for 2022?
Throughout the pandemic, companies experienced (and continue to experience) the direct value of technology deployed at an impressive pace, followed by modifications through test and learn. This is all based on immediate critical business results experienced in a very unpredictable marketplace. These dynamics have forced a lot of unanticipated change in IT planning protocols, starting with prioritization of the annual “call for projects.” As companies were hit with the project choices toward the end of the 2020 first quarter when final decisions are usually made, the pandemic and business interruption meant those projects had to be whittled down to a critical few. The priority criteria had to be based on business need, organizational need and bandwidth.
The companies and leaders that recognized the call-to-action early and made the hard decisions were better positioned to step up and into new opportunities than those who decided to hunker down, and hope & wait for the return of “business as usual.”
The key for those CIOs and IT organizations that emerged better and stronger was astute business acumen. Their decisions were not purely technology for technology’s sake, they were based on applying extensive knowledge of the business model on the fly: the customers, the products and services, the processes, and how quickly they could effectively apply technology solutions without a lot of guidance. Second, also key was the ability to predict what was most likely to be critical in the long run -- the IT strategy components that would both sustain business throughout disruption and position it for opportunities to move forward.
Know Your Business, Know Your Strategic Priorities
As the budgeting process proceeds, consider the positive learnings of the past 18 months:
First, treat prioritization pressure as a positive and keep the list short. This allows focus and creates space for other unplanned changes that are likely to appear.
Directly deliver business value. Ask what this does to make the business better and how you can measure it. This is the business case – the value proposition, pick your highest strategic digital initiative thoughtfully. Keep the Technology prioritization list short, actionable, and impactful.
Collaborate with other business unit leaders. Develop a balanced view and full understanding of the business dynamics.
While the annual budget process may seem ritualistically similar across many companies, the core of what is being planned at many companies has evolved dramatically in the last year. In 2021, many organizations were in recovery mode because so many things had to be set aside to respond to the crisis at hand. Today, with leverage points and economics in the marketplace still morphing, new and existing products and services are now often operating in mix-and-match combinations. All this transition has driven massive digital adoption in a short period of time.
Business acumen is crucial to identifying top technology priorities, just as financial acumen is fundamental to knowing how business value is measured. If you’d like more information about StrataFusion advisory services, contact us today!
This three-part series is dedicated to three critical success factors for today’s CIO: financial acumen, business acumen, and technology acumen.