The latest CIO issue is out and it has a nice article about the “proper” amount of capital to spend on IT systems. The article does a very fair job of presenting the research. Instead of looking at a percent of total revenue or a percent of operating expense, the research details we should use a % of net revenue and % of operating expense.
Other highlights:
- There’s a finite amount that should be invested — beyond which are diminishing returns.
- This is about infrastructure — not software (typically viewed as an investment)
- There are examples by industry.
Enjoy!
CIO Magazine has a fun article about the mob’s CIO. While the article is fictional, there is a great perspective we can learn from it:
Unless it makes or saves money, we don’t do it.
I wish everyone would think like this and track projects and meetings like this.
There are reports on IT every day. Boring, dead reports. Here’s one everyone should read. After reading it, decide how much you are willing to do to grow.
In the December 2006 edition of CIO, an article from CIO and the MIT CISR covered the stages of enterprise architecture. Essentially, organizations go through stages of IT maturity.
Don’t miss this table.
When reading the article, please keep in mind most companies stop at Stage 2 (Standardized Technology) and one can be in multiple stages at once if there are multiple divisions of an organization.
Moving from Stage 2 to Stage 3 (Standardized Processes) is very tough. This is why most firms do not ever move out of Stage 2. Its easy to look at the budget and think, “What can we cut or what can stay the same as last year?” It requires minimal thinking and nothing extravagant.
When one desires to standardize processes (Stage 3), multiple areas of an organization are called into play. People must change the way they work, coordinate terms and understand what they do every day. All of the knowledge contained in brains has to be committed to paper (or electrons) so process planning can occur.
Process planning is the work that causes stress. People from different departments write down how they think the total process works and are shocked to find out the process is wrong or inefficient. Positions may be eliminated and created, too. Wouldn’t it be easier to keep on keepin’ on?
