Evaluating the Effectiveness of Technology Investments
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Chapter 1: Understanding Technology Investments
Assessing how effectively our technology is delivering value can be a challenging task for technologists, business professionals, and consultants alike. The complexities involved in both the business and technology spheres can often complicate this evaluation. Imagine having a straightforward tool at your disposal to facilitate this assessment.
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Section 1.1: A Simple Tool for Assessment
To initiate a discussion that may lead to a more comprehensive evaluation tool, I have devised a basic spreadsheet designed to assist in answering this critical question. I have pinpointed five key areas: strategy, adoption, operations, customer satisfaction, and agility, along with two questions for each. This is not an exhaustive list, and I'm sure there are more effective areas and questions. Nevertheless, I aimed to provide a simple framework to gauge our current standing, using ten quick questions for a rapid assessment.
The scoring is set on a scale of 1 to 10, allowing for a total score of up to 100. It's essential to note that the scores are not meant to be precise but rather to provide a general sense of performance.
Three grading bands have been established:
- 81+ is excellent.
- 51–80 indicates that some areas require attention.
- 50 or below signifies significant deficiencies.
These bands can be adjusted as necessary.
Subsection 1.1.1: Hypothetical Example of a Leading Company
Let’s explore this concept using a theoretical example of a tech-centric company. This organization has a clear business strategy, and its technical and business projects are well-defined, prioritized, and adequately resourced. They have invested in data governance and analytics, ensuring they have reliable information for decision-making. Furthermore, their systems are designed with future developments in mind, and team members readily accept the technology.
When answering the assessment questions for this company, it becomes clear that achieving a score of 81 or more is challenging. For example, I rated a couple of questions with a 10, which is rather unlikely, suggesting that perhaps the threshold for the excellent band should be reconsidered. Areas with lower scores, like the feedback collection process (question 4), which I rated a 6, highlight where improvements are necessary.
Here's the spreadsheet for this imagined company: [Link to Spreadsheet]
Section 1.2: Mid-Sized Business with Technology Challenges
Now, consider a mid-sized business with a less-than-stellar technology track record. This company suffers from a vague business strategy and unclear goals. Although technology is attempting to align with these goals, the lack of clarity makes it difficult. Employees are using available tools, but they may not be the right ones for their needs. There’s no formal mechanism for gathering feedback, and while the company can close its books, the process is cumbersome. Decision-making reports exist, but analytics are lacking, and customer satisfaction remains average, limiting the company's ability to attract new customers or markets. The absence of architects has resulted in prolonged system implementation timelines.
In this scenario, the results will likely fall into the red zone, indicating a significant need for improvement. However, the assessment can help prioritize areas for enhancement. Notably, improvements may not solely focus on technology; addressing the business strategy is equally important.
Here's the spreadsheet for this imagined company: [Link to Spreadsheet]
Chapter 2: A Balanced Technology Approach
A more representative example would be a company that falls in the middle of the road regarding technology use. This organization has a well-understood business strategy supported by technology, although it has not been updated recently. Employees are utilizing the tools, but feedback mechanisms are insufficient. Operations are adequately supported by technology, although there is room for improvement. Data is accessible, and some analytics initiatives are underway. Customer satisfaction is good, but the technology infrastructure needs to expand to reach new markets. An architecture team exists, although it is under-resourced, particularly in data architecture, and new system implementations are manageable.
Even in this case, the spreadsheet serves as a valuable tool to pinpoint areas needing attention. Here's the spreadsheet for this imagined company: [Link to Spreadsheet]
Conclusions
Utilizing a spreadsheet like this can aid organizations in determining how well their technology supports business objectives while highlighting areas that may require focus. Different questions may be tailored to fit your specific situation.
Copy of the Spreadsheet
If you're interested in receiving a copy of the spreadsheet, please reach out to me at [email protected], and include your name and email address.
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