Technology Business Management (TBM) is a framework for IT business and financial management that continues to gain mindshare among CFOs, CIOs and IT leaders. Because it enables and supports fact-based decision-making, TBM helps drive down costs, improve services and align IT strategy to overall corporate strategy.
These are the Top 5 themes that will define success in TBM over the coming year.
1. TBM drives IT transformation. TBM is a framework for IT transformation, but what does that actually mean? IT business leaders are constantly seeking to improve their services, save costs and meet changing business requirements. But change isn’t always in their control—users demand new technology, corporate strategy drives expansion through mergers and acquisitions, and new business lines are introduced. IT must be flexible in the way it manages change to meet business demand. TBM provides IT leaders with the discipline to gain clarity in a complex IT enterprise and to drive value for the business. It starts by defining your current state through IT cost transparency. Once you have a clear view of your costs, you can refine your strategy and reap the benefits of IT transformation.
2. Your decisions are only as good as your data. The number one complaint from enterprises working toward IT optimization is that they don’t have reliable, comprehensive data on their IT environment. This means IT leaders face the constant challenge of collecting, aggregating, benchmarking, analyzing and developing sound conclusions on incomplete or estimated data. An IT cost model is only as good as the data that feeds it, but the only way to gather and clean up that data is to define what you have and what you need. Dirty data is a vicious cycle; you can’t achieve cost transparency because you don’t trust your data, and you can’t improve your data without cost transparency. TBM and cost transparency provide the tools for eliminating dirty data.
3. Align IT strategy with corporate strategy. The complexities of an enterprise IT organization often overwhelm the intention to drive business value from IT. Running IT as a business and aligning IT strategy to specific corporate objectives is a core element of TBM. By defining outcomes and use-cases for cost transparency, TBM gives IT leaders a way to demonstrate the contribution IT makes to the overall success of the company. The business of running IT is essential to the business of running the company.
4. Data analytics drive optimization. So you have a solid TBM strategy and ongoing cost transparency. Now what? How do you know which costs are too high or what services are not performing at the highest level? Collecting, validating and aggregating the data is only the first step. Applying data analytics and benchmarking can help identify areas of improvement and build a plan to execute on optimization. Understanding, interpreting and, most importantly, executing on cost transparency is the linchpin to TBM success.
5. Use TBM to drive EBM (Enterprise Business Management). EBM is TBM’s big brother. Just as IT must align to corporate strategy, the enterprise can extend the principles of TBM to a broader EBM strategy to drive optimization in every facet of the business and deliver meaningful business transformation. By leveraging TBM to align and aggregate IT costs, corporate finance managers can better execute on an effective corporate strategy and drive ongoing financial management and optimization.
ISG works with companies to help them drive cost savings, service improvement and align IT strategy to overall corporate strategic objectives through the TBM framework. Contact us to discuss further.About the author
Lara Gorton is an Account Director at ISG in the Banking, Insurance & Financial Services (BFSI) practice. Partnered with ISG consultants, Subject Matter Experts, Partners and Directors, Lara coordinates and collaborates on engagement proposals and works to further develop client relationships. Lara has over 20 years of experience in the Financial Services industry with a focus on strategic account development and IT project management and extensive experience in managing process, personnel and project planning and implementation.