Investing for transformation in 2013
How to maximize the return on your investments in disruptive trends like big data, cloud computing and mobility
Computerworld - For many organizations, now is the time for annual strategic planning and for identifying where to invest in IT initiatives in 2013 and beyond. One of the key questions faced every year is deciding, given a limited budget, on the most attractive investment choices to make and on the percentage of the investment that should go toward core, adjacent and transformational projects.
A recent Harvard Business Review article points out that a typical allocation is something like 70/20/10, with 70% of the investment going into the core business, 20% into adjacencies and 10% into new, transformational initiatives. Interestingly, HBR points out that the financial returns are typically the inverse of the spend allocations -- that is to say, 70% of the returns come from the transformational initiatives and only 10% from the core.
When we apply this thinking specifically to IT investments, another question is how to maximize the return from investments in disruptive technologies such as cloud, mobility and social networks. Of course, the return will depend on how big a bet you are placing on these initiatives -- sticking with smaller-scale departmental projects or going all out with implementations aimed squarely at the core of your business.
It's worth noting that disruptive technologies aren't necessarily adopted as transformational initiatives. Yes, that would be the case if you were taking a new product or service to a new market, but if you were incorporating the disruptive technology into your mission-critical, "run the business" applications (perhaps via application modernization), that would be a core-business initiative. And as these technologies have become more mature and proven, implementing them within your core business in 2013 can be a great way to harness their value.
Here are five recommendations for maximizing your returns with disruptive trends:
1. Look for areas where the trend can enhance your mission-critical applications. Many mission-critical applications are in need of modernization, and techniques such as cloud-, social- and mobile-enablement can raise them to leading-edge functionality and enhance their value for both internal and external end users. In addition, modernization can be a lower-cost and lower-risk approach than typical "rip and replace" initiatives, where new software development or new implementations are required.
2. Look for transformational ideas that can help innovate new processes and business models. Disruptive trends and their associated technologies are simply the means to an end, but they can open new possibilities. As an example, NFC (near field communications) technology in some of today's smartphones can offer a way to rethink physical access control and payment methods for employees.
3. Look for internal efficiency gains where you can generate significant cost savings or productivity gains. You might be able to optimize IT spending by moving application development and testing to the cloud or leveraging social collaboration more extensively across the organization. For example, the city of San Francisco is using Yammer for real-time employee communications during day-to-day operations, which has helped it reduce costs by forgoing an unwieldy infrastructure.
- The Internet of Things meets disruptive technologies
- Mobile Next.0: Five business scenarios for the wearable, augmented-reality era
- The power of social automation
- The cybersecurity needs of the borderless enterprise
- Mining your organization for ideas
- Timing your move into disruptive technologies
- Investing for transformation in 2013
- Moving the new wave of technology from disruptive to productive
- Next up: The consumerization of business processes
- The IT paradox: A diminished role in technology, but greater clout in the business
- Silicon Valley's 19 Coolest Places to Work
- Is Windows 8 Development Worth the Trouble?
- 8 Books Every IT Leader Should Read This Year
- 10 Hot Hadoop Startups to Watch
- Slideshow: 7 security mistakes people make with their mobile device
- iOS vs. Android: Which is more secure?
- 11 sure signs you've been hacked
- CIOs Deliver Productivity Breakthroughs with Intelligent Digital Signage Retailers have long recognized the influence that digital signage provides over a shopper's point-of-purchase decision making process.
- Oracle Fusion Financials Cloud Service Modern organizations are under intense pressure to provide accurate, reliable, and speedy financial information to business decision-makers. Furthermore, complying with global standards has...
- Cloud for Business Managers in Midsize Organizations: The Good, the Bad & the Ugly Read this independent research report to learn how business managers around the world are using Cloud applications.
- Cloud Computing eGuide In this eGuide, CIO, Computerworld, and InfoWorld offer advice, tips, news, and predictions regarding cloud implementations in the coming year and beyond. Read...
- Cloud Knowledge Vault Learn how your organization can benefit from the scalability, flexibility, and performance that the cloud offers through the short videos and other resources...
- Video surveillance for IT: maximum image quality, minimum bandwidth Join us on Thursday, May 8th at 1 p.m. EST when Willem Ryan, Senior Product Marketing Manager at Avigilon, will discuss how IT... All Cloud Computing White Papers | Webcasts