CIO Innovation Corner
CIO Roadmap to a Self-Funding Innovative Model
By Ryan D'Souza, Managing Partner
Innovation has become a key driver for CIO's today. The role of the CIO is transforming from a manager of Information Technology (IT) to C-suite leader who enhance business strategy and innovation that results in a competitive advantage. With budget pressures and increase costs escalating, CIO's are looking to moving away from their traditional business model that constrains innovation and efficiency to a model that enhances business value through innovation and business growth.
Successful CIO's also recognize that IT has become far more than a means of increasing efficiency and reducing costs. Rather, they see that innovation can create new and differentiating business value for their organizations, and IT has an integral role in that process. Research shows CIO's today are taking some important steps in helping to reposition their IT infrastructure to support business growth, as well as to continue to drive IT operational efficiency. In addition, IT organizations may find it difficult to meet the rising demands of the public. After all, they're expected to create new services on top of existing infrastructure, which requires extensive integration work as well as ongoing change and upgrades to those systems. They are also dealing with outdated components and an overall infrastructure that isn't based on open standards, which creates a great deal of complexity. On top of all that, IT organizations have to make sure that they're complying with regulations, protecting the privacy of their citizens and following security-rich processes and procedures.
So how can "CIO's, who are already under pressure reduce the cost of their IT, help drive business model innovation, enhance collaboration and integrate business/technology?
The answer is: Create a self-funding model to Innovative your business
In this value model, the IT infrastructure itself can become a critical part of the overall funding equation. By taking costs out of infrastructure and reinvesting the savings, CIO's and IT executives can drive both cost reduction and enhance business enablement and innovation. Below roadmap outline steps IT executives and CIO's can take to develop a self-funding innovative model in order to increase IT efficiency and effectiveness within your organization.
1. Assess Current Infrastructure State
From analyzing your current IT infrastructure, aligning IT with business initiatives to unlocking the value of your current IT investments, saving can be generated which in turn can invested for new service capabilities.
2. Optimize your Project Roadmap
Work through the set of activities that are required to move you along the desired path to get to that aspirational state. You can then create a prioritized roadmap of improvement projects that will enable you to maximize your business benefit. The first wave of projects you implement should be those with the highest benefits; that is, those that most closely align your IT and business strategies. By prioritizing your IT improvements, you derive the greatest business value up front and those savings can be reinvested in new capability development to drive additional business value. This is done through Portfolio Management and Business Case Management.
3. Develop Sourcing Alternatives
After establishing the set of improvement projects that are key to moving you toward your end-state objective, look at the available options to source and fund those activities. Think through each project and consider a myriad of factors to develop a position as to whether a particular project should be sourced internally, have some out-tasking applied to it or be fully outsourced. Many of these factors, which can include your available capital, your own IT expertise and the savings potential for the particular project under consideration. In addition, think develop an end-to-end sourcing strategy that will help you achieve your agenda in an efficient and cost-effective manner.
4. Design Future State
Develop an Architectural blue of your organization, choosing the right Vendor and as well as managing and monitoring your progress are some approaches to take. As we said at the outset of this discussion, what you're striving for today is an infrastructure that is flexible enough to respond rapidly to legislative changes as well as organic changes driven by constituent requirements. These changes, which take the form of service and business model innovations. These are the kinds of changes that enable fundamental change in the way government provides public services. To make those changes possible, you have to have an infrastructure that is flexible enough to accommodate change easily and cost-effectively. The result of working through these four steps will provide you with an actionable IT plan that aligns with and enables your business objectives.
By incorporating and taking the above fact based and actionable steps mentioned above, CIO's are generating the below savings that in in turn enhances business and customer value with their organization.
Our Eminent Business Institute thought leadership team are in process of writing articles for each phase of this self-funding innovative model. To receive these series of articles go to; http://www.eminentlogic.com/ebi_sub.asp to subscribe for free to Eminent Quarterly
Eminent Business Institute Team
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