Each year, South African small and medium businesses lose significant amounts of money, because most business leaders have little or no understanding of how IT contributes to their companies' performance.
Chris Welham, Executive Director of Space Age Technologies - an IT company with 19 years of experience in the industry - believes there is a fundamental disconnect between IT and executive decision-making.
"IT has traditionally been something of an island," Welham says. "There is precious little shared understanding between executives and IT technicians of what IT does in a business and the enormous potential for technology to be an integral part of the success of a company."
Welham notes that, because most business leaders only have a superficial understanding of IT and its role in a business, their IT budget is often incorrectly allocated and IT spend is not necessarily linked to business imperatives.
There are several reasons that contribute to the historical disconnect between IT and executive decision-making; among them are: a business' expectations of IT, strategic positioning of IT within the business, IT's roles and responsibilities, IT financial management, a shared understanding of IT between business executives and IT professionals, and IT performance management within the business.
"While IT is viewed as a grudge spend - as it currently is - its full potential in shaping the success of a business cannot be realised," says Welham.
So, what is the solution?
Welham believes the answer is "Relevant IT" - a term coined by Space Age Technologies to describe a new approach that helps business and IT leaders see eye-to-eye in achieving company goals. The Relevant IT framework provides small and medium companies with a roadmap that guides business executives and IT professionals on a journey towards integration, where IT leaders play a much bigger role in the strategic planning of a business, and business leaders have a better understanding of the value contribution of IT. With this shared understanding, IT costs become transparent and technology is used for the benefit of the business.
This process is tracked by a maturity model developed by Space Age Technologies.
Standard practice in the industry currently is that 70% of IT budget is spent on maintaining existing systems, and the remaining 30% is invested in new systems that have the potential to grow and transform the business. The Relevant IT approach allows executives to understand and better allocate the spend on maintenance, in some cases, even tapping into the 70% to invest more in new technology that will help grow their business.
Welham emphasises that Relevant IT is not something that can be achieved overnight. "Closing the gap between business and IT requires a change in mindset and a willingness on the part of both parties to come to a shared understanding," he says. "While this journey may take several years, the end result for both industries is definitely something worth working towards."
For more information, visit www.spaceage.co.za.
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