I have to admit that I don’t often get excited about IT articles. But, the recent article titled “The do-or-die questions boards should ask about technology” by Paul WIlmott, a director in McKinsey’s London office, had me at “Hello!”
Now, granted, part of why I got so excited is because what Mr. Willmott writes is almost to the letter the types of questions we’ve confronted with our clients for decades. It is very nice to be affirmed!
The article centers on nine key questions that boards should be asking. Our list has ten, and is not directed to board of directors. Rather, we insist that everyone responsible for the business confront them. Everyone. From business unit managers, to lone-wolf proprietors. From the c-level suite, to brand managers. We believe that it is the only way to raise awareness, technology literacy, and operational results across the business.
Our questions, formed over years of experience and client feedback, are distilled to the ones below:
1. Is IT an integral part of your business plan?
When was the last time you did a SWOT analysis? Was IT a component of this work? It takes courage to face the sometimes brutal truth of a SWOT analysis, and all too frequently IT is omitted. What happens next, if that happened? IT is be proven a tremendous vulnerability, with myriad outside threats confronting technology laggards.
2. What is your competitor doing with IT?
Technology has dramatically shifted the way businesses compete, communicate, and deliver goods and services. One of the most important metrics in your world should be tracking the IT innovation by your competitors. What are they doing? What software are they using? What are they developing? All these questions will give you actionable insight on what you need to pay attention to. Remember: If it can be done, it will be done. If not by you, then to you.
3. Are you connected with your customers with IT?
We’ve seen this too many times – the customers are way ahead of companies on their adoption of technology. How they view your partnership with them will depend on your nimbleness in integrating IT solutions with them. From direct delivery of “work products” to sophisticated EDI, becoming interconnected results in efficient operations, clear communications, and loyal customers.
4. Does IT show on the bottom line?
Most “old school” thinking around IT focuses on cost centers. Nothing could be further from the truth. IT can be a powerful, profit making, cost-cutting, people-enabling tool. You will know if it is, by evaluating the results of your IT investments on your bottom line. Still, few choose to measure it accurately.
What new business did you win from the software you developed? How did the new technology tools you gave to your people that cut costs and increase productivity? Did you increase customer loyalty by the steps you took to be available clients 24×7?
Ask these questions to see IT’s impact on your bottom line.
5. Do you have the right IT?
Sadly nine out of ten executives cannot answer this question. They simply do not know. Frequently dependent on their “IT people,” they accept their word as gospel. The same executives have their financials audited every year by an independent third party! It is critical that you open your doors and let an objective review affirm your choices, suggest alternatives, and give you options.
All too frequently internal IT people are threatened by this, and management responds to the sensitive IT feelings by backing down. Our answer to that is simple: No seasoned IT professional is ever threatened by the influx of new perspectives and ideas. They welcome it. Just as your accounting department is not “threatened” by your auditors, your IT department should be the one recommending a reality check and be inspired by what an outside view may contribute.
6. Are you vigilant with our IT security and compliance?
IT security and compliance is way more than password policies and a network firewall. It is about data encryption, database vulnerabilities, penetration testing, privacy concerns, competitive secrets, and client and personnel records just to name a few. And, these issues are getting bigger and more critical each day. You need to be vigilant, proactive, and very, very careful when it comes to your company’s exposure. So much so that security audits and policy reviews should be part of your annual review. Ignore it, and you might as well leave all doors and windows unlocked.
7. Are your managers and staff engaged with IT?
Engaged with IT does not mean, “I call the IT guy when something breaks.” It means understanding and leveraging the power of IT on daily tasks and processes. Everyone should be urged to ask the question of “How can we do this better?” push the envelope and use technology to do so.
8. Is IT part of our message both in-house and out?
Actions speak louder than words. Everyone across the board should be receiving the consistent message about the value of IT to the company, to its clients, to its future. It will break the barriers and allow for the conversations to flow. You will be amazed as to what your people, your clients, and your vendors can do once you make it clear that these tools, these resources are theirs to use.
9. Do we foster a culture of both accountability and support around IT?
It takes two to tango. Just as you need to be proactive and enabling of a new culture across all tiers regarding adoption and inclusion of IT, you also need to make sure that IT is accountable to the business, the IT staff recognizes the service component of the their function, and most importantly, that IT is synonymous with business support. Be clear on what the metrics for success are. Accountability is not about technology. It is about people that create and run the technology. Be clear about expectations and deliverables always.
10. How do we ensure a forward-thinking mentality, strategically and operationally with IT?
This perhaps is one of the trickiest questions to answer. It involves “living in” to decisions, processes, and a new culture. You must be attentive, careful, and vigilant in making sure that all the hard work that you did, that your managers did, and that your staff did does not get pushed aside by the “day-to-day.” Set time aside at least twice a year to meet, talk, and ask questions. If that means off-site, so be it, but on-site can be just as productive. Remember – actions speak louder than words. Do the do!
No matter which questions you ask – the McKinsey ones or the ones here – the most important take-away is that you ask them. We cannot emphasize this enough. Print them, email them, modify them, cut-and-paste them – do whatever works for you and your company – but act on them.
I guarantee you immediate and tangible return on your investment. Perhaps the only case where past performance is a guarantee of future returns!
