Focus Must Shift beyond IT Spending to Business Value

I have been a little quiet on the blog lately as I have been, and am still heavily involved with my wife in organizing and running the Sidney Fine Art Show – one of the largest and most anticipated shows in British Columbia and a highlight on the cultural calendar of Vancouver Island. In the space of three days, we transform a community hall

BodineEmpty

into a world-class art gallery which is visited by more than 5,000 people over the three days of the Show.

SFAS

The Show is also an example of what can be done when you have a clear vision, great people – over 300 volunteers – and appropriately used technology – in this case good old Excel which supports just about every element of the Show. In the current economic climate, and certainly in the context of significant cuts to government support for the arts in this part of the world, we have certainly had to be careful with our finances this year – the 7th year of the Show. We did not however make cuts “across the board” – we focused our spending on those areas that we felt would add the greatest value within the context of our vision. We spent less, sometimes nothing, in some areas, and more in others. I should add that the Show, totally run by volunteers, is not for profit, and not only do artists receive 85% of their sales revenue, but also any surplus from the Show goes directly back to the Community Arts Council of the Saanich Peninsula to support their many diverse programs. The cuts in government arts funding make the Show’s contribution even more important this year.

So, what does this have to do with IT – other than Excel? I read two somewhat conflicting reports on IT spending today, interestingly both under the CIO banner. The first, More CIOs Planning to Spend Money, Hire IT Staff, by Carolyn Johnson, suggests that more CIOs are planning to increase IT spending than at any time since mid-2008, with the average overall change (mean) being +5% . The second, IDC: IT spending unlikely to recover fully before next recession, by Leo King, reports  that IDC has warned that spending on technology will not return to pre-recession levels before the next downturn. IDC said CIOs should expect their budgets to grow, but only to a lower level than was reached before the recession, the highest realistic prediction was for a two per cent growth in spending by 2013.

Now, I don’t know who is right – nor quite frankly do I really care. While the amount of IT spend is interesting, and budgets should be managed responsibly, such discussion  continues to focus on the cost of IT. As in the case of the Sidney Fine Art Show above, the real focus has to shift to what is the business value of that spend. Our continued focus on spend – the cost of IT, is plain wrong-headed.We need to focus on value – value as defined by the Val IT ™ framework as “total life cycle benefits net of total life cycle costs adjusted for risk and (in the case of financial value) the time value of money”. Only when we do this will we come anywhere near to realizing the full potential of IT-enabled change.

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