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Tue 31 Oct 2006 08:00 PM

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Will business executives get it?

Todd McGregor, managing director of Forrester Middle East, sees corporate futures depending on BT rather than IT.

Historically, IT staffs have taken it on the chin for frustrating business groups by not keeping up and not being responsive. And, when frustrated enough, C-level execs fire or banish the CIO and start anew. But the frustration works both ways. IT execs rightly note that when business execs allow IT ignorance in their ranks, ignoring technology's potential and failing to listen to advice from experienced IT staff, the firm is the big loser. How can all of this change? The business technology (BT) future will arrive when all execs understand the valuable role BT plays alongside other business operations, both within the firm and within its partners’ value chain. In this BT world, business organisations become more IT smart and realise that to move up the business ladder, all execs must be able to pass an IT knowledge test. CIOs also need to raise their firms' BT consciousness.

Forrester asked CIOs if they believed they were in alignment with their business peers. The results were no surprise. On a scale from one to five, only 21% ranked themselves as a five for fully aligned.

Alignment is a perennial issue for CIOs because of their C level execs’ ignorance about technology's role in their companies' operations.We know this from CIOs' struggles to capture the attention of either the execs above them or their business unit peers.

Technology's pervasiveness has driven Forrester's recommendation to replace the group's title ‘IT’ with ‘BT’. Ask technology staffers if they know how the enterprise could run more effectively, and they eagerly answer: "Oh yes, we've thought about that! Here's what we should do." They get visibility into all aspects of the firm enabling them to:

Address inefficiencies:

Working constantly with business issues, tech execs encounter opportunities to streamline work. BT staffers at one firm were embarrassed when they saw the exchange of paper and faxes with customers.Without being asked, they designed an online approval process that cut 20% off the sales reps' workload. But we all know firms that ignore IT suggestions and still have paper processes for signatures and report exchanges, confirmation faxes, and read-only web sites.

Identify process problems:

Nearly two-thirds of IT's investments span business units, so IT execs want a process approach to delivering solutions. But their business partners still operate in organisational silos. A manufacturing plant's stockroom was buried in pick tickets when apparel sales rocketed off the charts. IT execs saw the problem, proposed new material automation software, and so removed a major barrier to ongoing growth. But we all know the cost-impacts created when some US automakers failed to upgrade CAD/CAM technologies to enable sharing of car chassis bills of material across models. The result: the reinvention of the manufacturing process for every new model, with higher product costs that gave Japanese competitors a price advantage.

See where staff can be eliminated - if politics permit

IT is ignored when it makes pointed suggestions to eliminate non-value-added work. Time and again, the business case for a new project involves eliminating labour in business departments. But firms rarely do thorough post-project audits with penalties for failing to deliver the results predicted in the business case. Why? Within enterprises there are always special interests.

Let's get over the idea that the work done by the department typically known as IT is anything other than essential business. Ultimately BT requires a paradigm shift. IT organisations are another business dimension of the enterprise and need to be viewed and managed as such.

Just as top execs who understand marketing and sales well tend to make sure that their products and services are properly marketed and sold, smart companies - ones with a Business Technology focus and technology aware top executives - get more value out of their technology dollar.