By Eileen Feretic  |  Posted 2009-01-23 Print this article Print

In 2009, companies must act quickly to implement technologies that bring real value to the business.

It’s very easy to make resolutions at the start of a new year, but, as we all know, it’s far from easy to keep them. Nevertheless, it’s essential for IT and business executives to keep 2009 resolutions that focus on improving their companies’ performance. Carefully orchestrating the integration of business and technology could make the difference between surviving—and possibly even thriving—and going under.

We all hope that our new president will stick to his resolution to turn the economy around. Barack Obama’s plans could have a tremendous impact on IT and business in areas such as security, privacy, offshoring of jobs, green IT, compliance regulations, R&D tax credits, Internet neutrality and intellectual property protection. (See “Hope and Change for IT?”.)

But enterprises can’t just sit still while the president tackles these monumental challenges, some of which may take years to achieve. Business and IT managers must act quickly to make changes that will bring real value to their companies.

Currently, 80 percent to 85 percent of IT budgets are spent on managing and maintaining existing systems, while less than 20 percent is spent on innovation, according to Compass, a management consulting firm. Clearly, that has to change. Organizations need to use technology in innovative ways to enhance the business, not just maintain it.

That’s starting to happen, says Tim Pacileo, a principal consultant at Compass. “Top performers are recognizing they can’t run a 21st century business on 20th century technology,” he says. “They’re using the slowdown to take actions that will provide a competitive advantage when the economy recovers.”

Those kinds of innovative endeavors are starting to take root in the health care industry, which is increasingly using IT—including electronic medical records, mobile technology and electronic workflow—to enhance the business by improving patient care, streamlining operations and cutting costs. (See “Giving Health Care a Dose of IT”.)

Since 2009 budgets are tight in most enterprises, it’s important to invest whatever money is available in technologies that will have the most impact on the business. That presents challenges in many enterprises.

“Non-IT executives cite shortcomings in how their IT organizations support key activities, such as working with the business to develop new, technology-enabled capabilities, or targeting areas where IT can create higher value,” states the third annual survey on IT strategy and spending by global consultancy McKinsey. “IT executives echo these concerns, highlighting the difficulties they face in partnering with business units to deliver activities that will have a high impact.”

That has to change. If business and IT executives can’t work together to create technologies that add value to the business, then both sides will fail. There is hope, however. The McKinsey survey states that 56 percent of respondents say their IT strategies include technology-driven business innovations, and two-thirds say that “further improvements are possible by integrating business and IT strategy more closely.”

That’s what Baseline magazine is all about: the fusion of business and technology. You, our readers, come from both camps. That’s why the main focus of our articles is on the business value of technology. Consider, for example, the achievements of the companies featured in this issue.

In “State Street Puts Agility in the Fast Lane”, Chris Perretta, CIO of this global financial services firm, says, “We look at technology as nothing more than an enabler.” State Street uses IT to respond quickly to business opportunities and changing market conditions.

Technology is also supporting business goals at the Tasty Baking Co., which is featured in “The Growing Appetite for Virtualization”. Thanks to the company’s virtualization initiative, “People can tell IT what they need, and IT can do it much more quickly,” says CIO Brendan O’Malley. “If we need to change our customer databases, it can be done in a couple of days, while it used to take six to eight weeks.”

Government also can benefit. The Transportation Security Administration’s business intelligence system has enhanced the agency’s performance in key areas, while also saving money. (See “New Routes to Performance Management”).

Clearly, these and other enterprises featured in Baseline have resolved to use technology to drive business success. Now we want to hear how your company is integrating business and IT. So, tell us, what are your 2009 resolutions?

Eileen Feretic is the Editor of Baseline Magazine.

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