IT Management is Really IC Management

The KNOW Network just declared IT Departments Fail to Deliver Value based on a global survey of IT executives by Axios Systems. Here are a few of the data points they cite:

• 57% believe their systems do not deliver the value expected by the business
• 64% are unable to provide the business with real-time quantifiable metrics demonstrating the value of their services
• 39% believe that business decision-makers still do not understand the value IT brings to the business.

The reason that IT management is so hard is that it is so closely tied to IC management. And companies are doing an even worse job with IC than they are with IT. Read more

CIO’s–and CFO’s–Need to “Get Real”

There is an interesting report at CFO.com called CFOs to CIOs: Get Real.

My response is that CFO’s need to “get real” too.

One of the biggest barriers between CFO’s and CIO’s is how they view the cost of projects. CFO’s are trapped inside an accounting model that expenses a lot of investments. Recent macro data suggested that US businesses spent $1.7 trillion on intangibles versus $1.2 on tangibles. For the most part, intangibles get expensed, tangibles get capitalized. Many  of these intangibles are related to IT-enabled systems and/or processes. Read more

How can we use IT to optimize our Intellectual Capital?

I received a call the other day from the administrator of a good-sized Sharepoint implementation. He had actually fielded a number of requests from managers in his organization about how to use IT to optimize IC.

Wow. I love questions like that, especially since I have had a category on this blog since last year called IT=IC. They were thinking in terms of knowledge management. I think that’s a great place to start but doesn’t get to the most exciting part. That’s because knowledge in itself is not that big a deal. Read more

Does Your Intellectual Capital Walk Out the Door at Night?

You know how people always say that the value of a business walks out the door at night? They are right on one level. Human capital is a critical part of every business, more so all the time as we move more deeply into the knowledge economy.

But there is more to intellectual capital than what’s inside your employees’ heads. And if you worry about your value walking out the door, you better understand the rest of the story. Read more

IT and the Building of Intellectual Capital–Are You Ready?

I was inspired by a great post here from IT Business Alignment blog that talked about the need for IT to focus on business, not technology.

In drafting my comment, I came upon  an analogy between building intellectual capital and building a house. IT often is treated (and acts) as a specialty contractor–creating the plumbing, the wiring and the foundation. I started thinking. What is really needed is a general contractor (GC), someone that coordinates all the pieces to make sure it is an integrated whole. Is that the role of IT? I think so. They have to make the pieces fit together, to coordinate it all.

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How to Increase the Return on Your IT Investments NOW

I love the fact that McKinsey is talking about IT as a strategic investment here and advising companies to avoid wholesale slashing of investments in “Managing IT in a downturn: Beyond cost cutting.”

There is a lot of good advice here. They lay out areas of opportunities for quick return for investment in specific business processes, as well as specific areas that can be ripe for short-term gain.

I think there is also a real opportunity in today’s environment to fine tune and increase your return on past investments. What I see with my clients is that the most important factor in success of IT investment is the accompanying ecosystem.

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Investment Tax Credits 2.0 — We Need to Consider Intangibles

An article in Business Week here about a conversation going on between Silicon Valley and Washington DC about the possibility of creating an IT innovation tax credit. This is a step in the right direction. Many of the dollars spent on IT are consulting and integration dollars which are not considered “investments” by accountants. But they  definitely are investments. Read more

IT Moving Beyond Automation to Creation

Susan Cramm has a great post here about the new frontiers of IT. She says,

Recently, I asked some business executives for their top three IT wishes. Across the board, their responses echoed a common plea: “I wish IT projects would come in on time and on budget.”

Funny thing is - this very reasonable sounding request is actually quite unreasonable. Read more

Getting Paid for Intangibles

Interesting look by Lucent-Alcatel here at “Business Transformation: Advanced Business Models for Converged Communications.” You don’t have to be in the communications business to find this article inspiring. They are making the case to companies that have traditionally built their businesses off the sale of “tangible” communication networks that they need to expand their revenue activities into intangibles. This is a shift that technology and product companies throughout the economy are making with increased frequency. It’s also a great illustration of how IT and IC have become so tightly intertwined in many companies.

The list of options includes services, asset sharing, outsourcing, advertising, fulfillment and community building, among others. This list could help you think about new revenue options in your own business. It’s also interesting to note that the last section of the piece highlights Lucent-Alcatel’s consulting services to help their equipment customers–a good example of how L-A has adapted their own revenue strategy to market needs and opportunties.