eyetoit: Good Reading for you CIO

December 08, 2005

Good Reading for you CIO

There is a great interview in CIO Insight with the principals of CogniTech on analyzing the IS contribution to an organization's performance. Unlike the vast majority of blurbs or articles I see about this subject in the IT press (fodder for a future post maybe), CogniTech's Lodahl and Redditt really get it. They founded their business on the same two premises that I do my writing here: "that businesses were going to become more and more dependent on IT, and that IT was being managed incorrectly."

They have developed a very sensible methodology for evaluating IS contribution to the business, which they baseline against corporate profit margin as that fairly accounts for both revenue contribution and cost control. Their approach decomposes aspects of the IT component of the business (and its interaction with the core business) into five broad factors, with each factor composed of several measures to allow quantification. Because they have decomposed and quantified this, they can also identify the way in which the factors cross-correlate as well as how they correlate with business performance. Many of the items are common sense, but we all know that is in short supply.

I would strongly recommend passing along the interview to your CIO. It can only help. The correlation analysis of contribution factors provides obvious guidance for many people in IT. For example, the strongest correlation in the chain of events is between customer satisfaction and IT credibility (it's a .82 correlation) - this is a blindingly obvious fact, but one seemingly ignored by many IT folks too focused on the technology or helping their users and sponsors see the wisdom of their grand architecture.

Note: This was written on the 8th of December 2005, but was not posted. I have been heads-down with the holidays, travel and then work. I will return to a regular writing schedule in the next week or two.

December 08, 2005 in IT Business Alignment, IT Governance, IT That Works | Permalink