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Decoding the IT Value Problem: An Executive Guide for Achieving Optimal ROI on Critical IT Investments

ISBN: 978-1-118-43805-3
208 pages
September 2013
Decoding the IT Value Problem: An Executive Guide for Achieving Optimal ROI on Critical IT Investments (1118438051) cover image
Gain greater returns from your IT investments

Revealing the secrets to proven, effective strategies that enable businesses to leverage the full value of highly expensive IT investments, Decoding the IT Value Problem is a no-nonsense guide for making smart IT investments and cutting through the noise of vendor marketing and media hype. Author Gregory Fell describes in rich detail the actual processes, frameworks, infrastructure and discipline required to develop and execute corporate IT strategies that are profitable and sustainable.

  • Provides a proven framework for developing and successfully executing profitable IT strategies
  • Plain English guidance for gaining the most return on investment from critical IT investments
  • Explores developing and executing IT strategy; forecasting, calculating and managing IT costs; leveraging IT investments to drive business growth; IT and the evolving global economy; IT value management; communicating IT value across the enterprise; and leading change, transformation and innovation

If you're a senior level manager or executive responsible for managing IT value in your business, Decoding the IT Value Problem is the practical and clearly written guide you'll turn to, with tools and tips for smart investment and management of IT costs.

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Foreword: Uncovering an Essential Skill of IT Management xi

Preface xiii

Acknowledgments xv

Introduction 1

Chapter 1 The Value of IT 3

The 80/20 Law of IT Spending 5

The User Interface Is Not the Project 6

Just Like Buying a Car 8

Don’t Forget Maintenance Costs 8

The Math of Availability 9

My Favorite Analogy 11

The Hard Facts of Uptime 12

Chapter 2 Why IT Projects Fail 17

Technology Is Not the Problem 19

Communication Is Critical 20

IT Projects Are Really Business Process Change Projects 22

When You Change a Process, Don’t Forget the People 24

Paradigm Shifts Are Real 24

Chapter 3 The Washington Principle 27

The Skills of a Leader 29

Why We Need IT Governance 31

A Process for Generating Commitment 32

They Cannot Read Your Mind 35

Multiple Levels of Governance 36

Delivering Expected Value 37

The Basics of Good Governance 38

Chapter 4 Balancing Risk and Exposure 41

The CIA Model of Risk Assessment 43

An Easy Method for Modeling Risk 44

The Risk Profile Matrix 44

Bring Options and Recommendations to the Table 49

Managing IT Security Risks 52

What about the Black Swan? 53

Note 54

Chapter 5 Time Is the Enemy 55

Riding to Nowhere? 57

It’s All about Time 62

If Necessary, Rebaseline the Project 63

The 5 Whys 63

Chapter 6 Software Is Not Manufactured 67

The Art of Programming 69

Consider Agile or Lean Methodologies 73

Chapter 7 Technology Disruptors 77

Keep Your Eyes on the Horizon 79

Think Like a VC 81

When Technology Disruption Hits Close to Home 82

Specific Trends to Watch 84

Beyond the Keyboard and Screen 85

Encourage Exploration, Experimentation, and Fast Failure 86

Chapter 8 The Office of Know 89

Correcting a Classic Case of Misalignment 91

Are CIOs Wired Differently? 92

Sometimes There’s a Good Reason for Being Risk Averse 94

Technology Is Not the Only Solution 95

The View from the Crow’s Nest 97

Faster, Nimbler, and More Proactive 99

Walking the Assembly Line 100

Gone Hunting 102

Moving from No to Yes 103

Chapter 9 Enterprise Resource Planning: One Size Fits Most 105

ERP Basics 107

ERP versus Best of Breed 108

Single Instance versus Multiple Systems 109

Keeping ERP Systems Up to Date 110

Chapter 10 Outsourcing IT 113

Three Strategies 115

Your Vendor Is Not Your Partner 117

The Value of Being Selective 118

Outsourcing to the Cloud 120

Scale Counts 121

Offshoring 123

Outcome ]Based Outsourcing 123

Chapter 11 Rebaselining the IT Budget 127

Robbing Peter to Pay Paul Is Not a Good Business Strategy 129

The Annual Budget Trap 131

A Different Approach 133

Moore’s Law and the Cost of IT 136

And the Moral of the Story Is . . . 136

Some IT Projects Are Very Expensive 137

Chapter 12 The CFO’s Perspective 141

Cash, Risk, and Benefits 144

Chapter 13 Optimizing the CEO–CIO Relationship 153

Making a Strategic Contribution 155

The CIO Evolution 158

Chapter 14 Conclusions 161

Don’t Burn Your Money 167

Note 170

Recommended Reading 171

About the Author 173

Index 175

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GREGORY J. FELL is the Chief Strategy Officer at Crisply, an enterprise SaaS (software-as-a-service) big data company that pioneered the algorithmic quantification of work. Prior to joining Crisply in 2013, Mr. Fell served as vice president and chief information officer of Terex Corporation, where he led a strategic transformation of the IT organization.

Before joining Terex, Mr. Fell spent nearly twenty years with Ford Motor Company. He started as a developer, and worked his way through a variety of management roles supporting the global engineering and manufacturing functions of the company. He has domain expertise on CAD/CAM/CAE systems, lean manufacturing, and control systems. He is a graduate of Michigan State University and spent several years on staff in the College of Engineering as a senior research programmer and instructor.

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