Let’s start off with a scenario. Let’s say you are preparing for a cross-country road trip. Before you head out, you are responsible and change the oil in your car. You prepare your playlist, grab your road trip snacks, and hit the road. You drive for a day or two and you make it through a few states before that pesky “check oil” light pops on. You’re annoyed because you just changed the oil and you’ve only driven a few hundred miles. But you don’t want to risk losing your engine, so you get off the highway, find the closest gas station and change the oil and hit the road again.
Now let’s say that happens every few hundred miles for your entire trip. My guess is that after the first or second time that “Check Oil” light went on, you would ask a mechanic to look at it to examine why you’re leaking oil, even if it meant extending your trip a few hours or a day to get it fixed.
Now, what if I told you that much like a car leaking oil slows down a road trip, IT services that leak value can slow down business growth. The difference is that CIOs don’t have a handy light that goes off to let them know an IT service is low on value. They have to look for the signs themselves.
If you’re wondering why your IT services aren’t delivering the way you planned, it’s time to check if you’re leaving value along the side of the road.
Understanding The Value Of IT
Before you check to see if you’re leaking value, you have to understand how you are creating that value to begin with.
The difficulty with value is that it is a perception. There is no one single definition of it. Value needs to be defined by every stakeholder in the organization — customers, partners, suppliers and internal stakeholders. Business leaders should be working with these stakeholders to define value and ensure that value is understood across the organization.
Once you have a definition of value inside the organization, you can begin to understand how IT co-creates that value with other stakeholders.
For IT leaders, this means understanding how the outputs IT delivers connect to the larger outcomes the organization is achieving. This will require you to work with other stakeholders in the organization to understand their projects, initiatives and goals, and how IT supports them. If you are able to connect how IT helped marketing hit its revenue goals, then you’re understanding where IT co-creates value and you can optimize your work, investments and priorities to increase that co-created value. If you are able to do this for every project you work on, then you’ll be running a value-driven IT organization.
Are You Consistently Delivering Value?
Now, many organizations may already do this. They already define value and IT has already worked with other departments to ensure they co-create value through their services.
But your job isn’t done.
Business doesn’t operate on a consistent basis every single day. No matter how tight our processes, how smooth the services are; there will be evolutions in services, products, and how the organization operates.
And sometimes, those evolutions are forced upon a business due to forces outside of their control. For example, a global pandemic can hit and everyday business life is turned on its head.
Other times, it’s not a major pandemic, but a slight shift in how a product is delivered, how an organization communicates, or the way technology is used.
Whether the reason is big or small, when undetected shifts within the value stream occur, IT services begin to leak value and IT becomes less effective. In other words, you have “value leakage”.
My friends at TaUBSolutions explain it this way; value leakage occurs when “solutions move from conception to customer implementation.”
Value leakage can occur when there is not adequate training, when there is poor management of organizational change, when we don’t retire services or products when we should, when there is poor employee and customer experience.
How to Avoid Value Leakage
Value leakage will always be a threat to IT’s effectiveness. It is up to the IT leader to be vigilant about delivering value and to look for the signs. Remember, unlike in your car, there is no “Value Leakage” indicator light.
Instead, IT leaders should regularly do two things:
- Talk with stakeholders about service delivery.
Are they still seeing value from your services? When was the last time you checked with your stakeholders to confirm this? (Hint: if you haven’t done this since COVID-19 hit, now is the time!) - Review customer journey maps and value stream maps.
These two tools were designed to help stakeholders understand how value passes through the organization and is realized by the customer. They will help you identify where value should be delivered or where it can be delivered.
Don’t leave value on the side of the road. Protect yourself from value leakage and check in with your stakeholders. I created a Value Leakage Indicator Tool to help IT leaders measure where they are and are not delivering value. You can download it for free here.
Additionally, if you need help identifying value, connecting IT outputs to business value or mapping value streams, please book a free 30-minute call for us to discuss how you can drive more value in your business.
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