Technology is top of mind for many business owners. Some invest heavily in leading systems and information technology (IT) professionals, while others focus on the minimum spend to keep the emails flowing. Regardless of where you fall on this spectrum, the rapid evolution of technology and rising customer expectations mean it makes sense to step back and think through your company’s IT strategy. PwC’s 2015 Annual Director’s survey confirms that a majority of business owners are doing just that — with 67% of boards of directors reported as being very engaged in understanding a company’s IT budget, up 10 points from three years earlier.
 
So how do you develop the right IT strategy for your business?
 
Your industry likely dictates base requirements for your business. For example, financial institutions require rapid transaction processing and real-time data visibility, while industrial product companies often rely on historical-looking financials and operational metrics to guide decision making. But, similar to corporate strategy or culture, your IT strategy should be unique to your business. Considerations such as your operational efficiency and employee engagement also should guide the direction and execution of your specific strategy. Thoughtful strategy, planning and investment is always better than disparate maverick IT spend. Eliminating shadow IT costs (a.k.a. ad-hoc solutions created within individual departments) and one-off processes and tools that often take hold without a clear IT strategy can lead to significant business benefits.
 
To effectively enable and support your business objectives, start by linking your IT strategy to your overall business strategy:

1. Consider key elements of your business strategy and define the technology capabilities that must be in place to achieve those goals.
2. Map your current technology environment and the business areas that are supported.
3. Develop an understanding for the gaps between your current and desired capabilities.

As you work through these detailed elements of your IT strategy, consider structuring your objectives around the following tactical processes and tools to find the right balance for your business:

Growth Drivers

• Predictive Analytics – Connect enterprise data with external information to identify trends and opportunities to increase business value.
• Brand / Web Presence – Make a lasting first impression on your customers. Provide the information and tools via your website and relevant social media channels to create an engaging customer experience and foster a community of supporting advocates.
• Innovation / Product Lifecycle Management (PLM) – Manage your core intellectual property to generate new products and services, while providing consistent product information internally and externally.
• Sales Pipeline / Customer Relationship Management (CRM) – Segmentation allows for more targeted marketing. Use a tool to provide timely touchpoints based on a prospect’s status in the sales process.

Operational Efficiency

• Management Reporting – Provide reliable, standard reports to your management team that highlight progress against key performance indicators from your strategic plan.
• Transaction Processing / Enterprise Resource Planning (ERP) – Understand your core business activities and optimize those processes. Integration to PLM and CRM optimizes work flow and ensures data quality.
• Employee Engagement / Human Capital Management (HCM) – Attract, grow, and retain your most valuable assets. Think beyond payroll and benefits to create an engaging workplace.

Foundational Stability

• IT Infrastructure Model / Cloud – Consider which resources, activities and systems should be outsourced to minimize distraction and cost.
• Data Governance / Master Data Management (MDM) – Control the building blocks of an effective technology environment. Establish thoughtful processes to create and update item, customer and supplier data.

With your desired capabilities defined, you can begin to develop plans for your future IT architecture and the roadmap to get there. Technology transformation doesn’t occur overnight, but with a well-aligned strategy and thoughtful planning, you can build the unique capabilities that will best support your business and enable ongoing value creation and success.
 
Cohen & Company is not rendering legal, accounting or other professional advice. Any action taken based on information in this blog should be taken only after a detailed review of the specific facts and circumstances.