I know this topic sounds strange, that is because it is supposed to be obvious. I mean everyone talks about how ICT makes business easier, faster and more efficient – yet you can walk into most businesses today and be amazed at the inefficiency and resource-wastage that goes on because ICT is being misused.
The value proposition of ICT to business can practically preach its own sermon: computers are at another level of speed, efficiency, accuracy and aesthetic quality above typewriters. The Internet provides via the world wide web, email, chat and newsgroups a means of communication that is richer, faster and more interactive than could ever be dreamed of via traditional snail-mail, printed brochures and whatever means of communication were available before the Information Age. In the same vein, accounting software are another level of functionality and capability above traditional ledgers and so are databases with respect to paper files and filling cabinets. In a more central role, ICT supplies tools for decision analysis, market intelligence, sales and service support as well as operational excellence that lead to great savings in operational expenditure.
However [and this is where the plot thickens] no single solution fits all – every business doesn’t need ALL of these technologies; they only need a subset of them and even then to different degrees. Thus while there are certain generic solutions for all organizations (– like the need for word-processing and communications via email), because every organization is unique, each one’s ICT solutions must also reflect this uniqueness for the solution to be effective, hence the need for thoughtful IT planning.
The Need to Re-Appraise the Role of ICT in Organizations
Our lives and therefore our organizations should be less about getting computers and software to work and more about them helping us work smarter – not harder [think 80/20 principle], and cheaper [The device and software makers have already spent sleepless nights about making computer and software work – or have they?]. For this to happen, each organization must properly re-position ICT’s role within its operations, strategy and value proposition for greater effectiveness. To do this, we must begin with a realization of the fact that it is the need to process information that is the essence of ICT in Business – it is only device and software manufacturers whose purpose ICT is. In this age, knowledge which is based on information is a company’s greatest asset and any company that has not realized this fact in both principle and practice will soon be out of business – if it already isn’t. Understanding this in principle is the first creation, the second creation – understanding it in practice is the more difficult because it entails putting just the proper mix of ICT technologies to form a solution that meets the organization’s business needs (including strategic ones).
According to the great management guru Henry Mintzberg, every organization does one or more of four things: it finds, keeps, transforms and distributes people, resources or information. Therefore the proper role of ICT begins with how information is used in the company, NOT how computers, switches, routers, servers etc. are used. In practical terms: it is because people within an organization need to share information that there should be a computer network in place and not because computers are more useful when networked – obvious isn’t it?
One of the biggest problems plaguing organizations in most developing countries today is the gulf that exists between the IT department and line management (and by interacting with other professionals in developing countries, I know know this isn´t unique to developing countries). The result of that gulf is evident in the fact that most organizations have spent and keep spending huge amounts of money on equipment that remain essentially under-utilized years after their acquisition despite the fact that a lot of business requirements are not being met. And a symptom of this malaise is the ICT solution that increases rather than reduces business complexity. Of course there’s the sad human factor of equipment being bought as a result of management’s overboard decisions [makes you wonder why management will impose equipment on the IT department – shady 15% commission perhaps?!]. On the other hand, some IT departments are run by people of questionable skill and leadership at best and at worst – plain mediocres and the only way to continually justify their employment and pretend to be relevant is to inundate management with requests to acquire impressive-sounding [and usually expensive] technology that doesn’t add substantial value to the organization’s value proposition. If key personnel in IT departments can learn more about business drivers and requirements, value propositions, return on investment and corporate strategy – with adequate empowerment from the organization’s top management, then the view of ICT’s role can be the same from both the perspectives of management and IT department and thus begins the repositioning process and the turning of the potential tap.
Understanding the Business Value of ICT – An Information-Centric Paradigm
Many experts have given their opinions on this issue in-depth in a 1999 Harvard Business Review on ‘The Business Value of IT’ and these can be summarized as thus: Fundamentally, ICT is a resource to the business, like people, money, and machines thus the effectiveness of its utilization depends how well it is understood. This means an on-going review of industrial trends and developments to continually identify solutions that suit the organization. According to John F. Rockart, to serve customers well, every organization must be proficient in the following areas:
Reduced cycle time.
Reduced asset levels (e.g. In inventories and people)
Faster product development.
Improved customer service.
Increased empowerment of employees.
Increased knowledge sharing and learning.
Interestingly, I can think of at least three ways in which ICT can help achieve each of these requirements for effective organizations. If your IT people can’t tell you at least one way, then you have a big problem in your company that may only become evident as the company grows in size. Better give your IT people some relevant education.
In conclusion, I’d say that most organizations shoot themselves in the foot with the aid of IT departments that are yet to understand that ICT infrastructure are not purchased for their own sake but because they are supposed to facilitate information flow in a manner that is as unique to that organization as its corporate strategy and value proposition. The way forward for effective solutions will come when IT departments and management sit together to analyze this question: ‘What are the critical needs of our business and what are the most appropriate IT solutions that can serve them taking into consideration our unique environment?” An honest, interdependent brainstorm of this question between competent people should yield the answers needed to put the organization on the right path to effective ICT-Business integration. So let the walls between the real IT guys and real management come down so that the questions, ideas and solutions can flow.