Using the Business Value of IT Calculator
The Business Value of IT Calculator (BVIT) is a very simple and intuitive approach that any executive team can use to understand where the company stands on its utilization of IT. Almost all business functions use IT to some degree. Therefore all functional business executives should have a view of how well IT is serving their needs as well the overall business needs. The BVIT uses a very intuitive survey approach to ask 10 questions of the executive team and aggregates results to get an aggregated composite rating of value from IT.
The dimensions of the BVIT include many different elements of the types of value that IT should deliver in any organization. Though this tool can be further customized for any business, the basic elements of IT value included in the tool are:
1. Innovation – a measure of how well technology is being leveraged to drive business innovation and prepare for the future.
2. Marketing value - a measure of how IT enables marketing efforts in the organization including the company web site, use of social media, tools used for brand development and marketing spend analytics tools.
3. Product/Service value - a measure of how IT is assisting in new product design, customer feedback, innovation and new ways to provide value.
4. Customer Oriented value - a measure of how well IT is leveraging technology to serve basic customer needs - product/service info, service requests, customer service automation, fully support and delight our customers.
5. Revenue Oriented value - a measure of how well IT helping to generate revenue through E-commerce, payment and collection systems? For managing the sales pipeline.
6. Decision making value - a measure of how well technology provides analytics information to make daily/monthly/quarterly/annual business decisions in various areas of the business.
7. Employee collaboration value - a measure of how well technology is be used by employees, including: PCs, Laptops, mobile devices and basic applications such as e-mail and Word processing.
8. Business Process Automation - a measure of how effective IT is at automating internal business processes such as sales, manufacturing, distribution, Finance and HR.
9. Information Security - a measure of how well IT is securing information assets.
10. Compliance - a measure of how well IT is complying with the relevant standards and regulations for our industry and practices.
The BVIT is a survey tool taken by the executive suite. Each of the dimensions is rated on a scale of 1-10. The tool provides suitable and intuitive language for what a 1 or 5 or 10 rating would feel like. Once rating data is gathered and aggregated across executives, the results provide key insight into the value of IT.
A composite rating between 1 - 4 indicates that your organization is not leveraging IT well. A rating between 4 - 6 indicates average value from IT. A rating between 7 - 10 indicates that you are in the top 30% of IT savvy firms who take advantage of IT to win in the marketplace.
Tools
- Business Value of IT Calculator
The Business Value of IT Calculator has been developed to help in these ways:
- Understand how technology could impact leading indicators of business value in your organization.
- Assess the business outcomes of technology in your business on a relative scale and point you in the right Direction.
- Identify your IT strengths to leverage them and your IT weaknesses to improve upon them.
- Help you and your team get a better grasp of ways to use technology to create value for your business.
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