The long conversation february 2013
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Transcript of The long conversation february 2013
The Long Conversation: Maximizing Business Value from IT Investment
©The Long Conversation: Maximizing Business Value from IT Investment – Lorenzo, Kawalek, Gonzalez, and Ramdani 1
We argue that organizations need to maximize the value of their existing IT assets. It takes a long time and a lot of learning. In doing so, organizations need new organizational capabilities and social networks.
We are living in exponential times.
New technology announcements every day.
This is exciting.
The Long Conversation: Maximizing Business Value from IT Investment
©The Long Conversation: Maximizing Business Value from IT Investment – Lorenzo, Kawalek, Gonzalez, and Ramdani 2
Businesses assimilate technology slowly.
How should one cope with that?
The Long Conversation: Maximizing Business Value from IT Investment
©The Long Conversation: Maximizing Business Value from IT Investment – Lorenzo, Kawalek, Gonzalez, and Ramdani 3
A study of total costs of Enterprise Applications ownership by the Aberdeen Group reveals that companies with turnovers between $1–$5 billion pay an average of $5,920,785, and companies with turnovers between $50 and 100 million pay an average of $1,081,869 for a complete ES package, which includes the configuration and implementation of software, after-sales service, and maintenance.
The Long Conversation: Maximizing Business Value from IT Investment
For the last 20 years, companies have been implementing and adopting large-scale IT, most notably enterprise systems (ES).
They have done this in order to automate transactions, reduce costs, increase customer satisfaction, integrate with suppliers, and make better decisions.
Examples of ES include applications for:• Enterprise Resource Planning (ERP),• Customer Relationship Management
(CRM), • Human Resource Management
(HRM), • Product Lifecycle Management (PLM)
and,• Supply Chain Management (SCM).
©The Long Conversation: Maximizing Business Value from IT Investment – Lorenzo, Kawalek, Gonzalez, and Ramdani 4
The case of Enterprise Systems
Businesses are not able to exploit the full potential of their existing technology.
We jump to IT project by project like some kind of hyperactive frog and significant amount of IT value is left on the table.
As a consequence, IT is underutilized.
This happens every day, even in our individual interaction with technology.
IT investment
BusinessProductivity
The Long Conversation: Maximizing Business Value from IT Investment
©The Long Conversation: Maximizing Business Value from IT Investment – Lorenzo, Kawalek, Gonzalez, and Ramdani 5
The main priority of businesses today is the value creation from the existing (already implemented) technology.
Executives should milk the current IT platform.
The Long Conversation: Maximizing Business Value from IT Investment
©The Long Conversation: Maximizing Business Value from IT Investment – Lorenzo, Kawalek, Gonzalez, and Ramdani 6
The Long Conversation: Maximizing Business Value from IT Investment
©The Long Conversation: Maximizing Business Value from IT Investment – Lorenzo, Kawalek, Gonzalez, and Ramdani 7
The application of the Long Conversation model has an important set of practical implications for organizations.
We have summarized these into three layers1) The Business Value ladder, 2) The Long Conversation
process, and 3) The Organizational
capabilities.
The Long Conversation: Maximizing Business Value from IT Investment
©The Long Conversation: Maximizing Business Value from IT Investment – Lorenzo, Kawalek, Gonzalez, and Ramdani 8
We see it as akin to a biological process.
The Long Conversation: Maximizing Business Value from IT Investment
©The Long Conversation: Maximizing Business Value from IT Investment – Lorenzo, Kawalek, Gonzalez, and Ramdani 9
The Long Conversation: Maximizing Business Value from IT Investment
©The Long Conversation: Maximizing Business Value from IT Investment – Lorenzo, Kawalek, Gonzalez, and Ramdani 10
Managing the implementationProject management vs. an emergent learning process
Managing knowledge and learning Traditional training vs. social learning
CEO Role Project support vs. Capabilities development support
Key Users Role Implementing the system vs. Mastering the system
ES Team Project team vs. Social network
Directed incrementalism
Balancing direction with incremental execution (action-learning, and fast learning cycles).
Key to handle inherent uncertainty and political context
The Long Conversation: Maximizing Business Value from IT Investment
©The Long Conversation: Maximizing Business Value from IT Investment – Lorenzo, Kawalek, Gonzalez, and Ramdani 11
IT journeys instead of IT projects. Longtime, long-life journeys, instead of short IT projects. This is our long conversation. When we talk of the Long Conversation, we are talking of the whole process of living with IT,
from its conception, past the point of accommodation and through into the ongoing processes of learning and innovation.
The Long Conversation: Maximizing Business Value from IT Investment
©The Long Conversation: Maximizing Business Value from IT Investment – Lorenzo, Kawalek, Gonzalez, and Ramdani 12
Thank you very much!
The Long Conversation: Maximizing Business Value from IT Investment
Oswaldo LorenzoDeusto Business School
Peter KawalekManchester Business School
Gastón GonzalezExpertia Consulting Group
Ben RamdaniBristol Business School
©The Long Conversation: Maximizing Business Value from IT Investment – Lorenzo, Kawalek, Gonzalez, and Ramdani 13