IT Combined Result of Value Delivery

The alignment of business and information technology strategy has grown in importance as IT has become strategically significant in organizations. No longer confined as a support function, IT is playing an instrumental role in contributing to the better functioning of almost all business departments. Business heads these days proactively engage with their IT counterparts during strategic and operational planning, and try to co-create values for the organization.

There are several ways that IT can create value, says Joydeep Dutta, CTO, ICICI Securities, which has a pioneering online trading platformICICIdirect.com. Projects are assessed and executed on the basis of what value they deliver. We classify projects which generate revenues, achieve cost savings, deliver customer convenience, improve process efficiency and speeds, or enhance productivity. Some projects may deliver more than one of these aspects, says Dutta.

There are companies offering products and services in the traditional brick and mortar way, many of them have gone online, thanks to the technology. For a financial services platform like ICICIdirect with over 2.2 mn customers, and almost all products and services being offered online, technology is the key business enabler. Having 24x7 systems uptime, scalability, high availability, and systems redundancy are of prime importance for us, explains Dutta.

Within the financial services sector, the stock broking business is even more time sensitive, where a millisecond delay can be a cause for the customer to lose a market opportunity. The servers are under constant monitoring and surveillance by the IT team. In this industry, technology can prove to be the differentiator among equals.

Dutta with over 25 years of experience in various capacities including a 11 year stint in US markets would know.

While we know IT creates value, defining and measuring the same can be a challenge. If we cannot quantify the benefits and strategic goals, we should probably not be doing a project, says Dutta.

While we in IT may get excited by technologies like virtualization and cloud computing, the people impacted by these technologies simply want to know how their lives will improve by adopting what we are recommending. When we can separate the benefits from the technologies that deliver them and effectively articulate those benefits to our colleagues, then IT will be perceived to be a value creator and most easily accepted and embraced, opines Dutta.

IT as an enabler has been a long debated topic. Businesses across industries have accepted and realized the potential of IT and is now an integral part of the business processes. Technology is essaying an important role in creating value to the business. However Asmita Junnarkar, CIO, Voltas, disagrees on the opinion of technology providing value to the business. According to Junnarkar, Technology investments are approved based on the RoI (both tangible and intangible) and therefore measuring business value of IT is a challenging task. Value delivery is a combined result of IT systems, business processes, and people initiatives. It is very difficult to calculate how much value is purely attributable to IT.

The company has been a frontrunner in using IT solutions to create value to business such as end-to-end business operations on SAP ECC 6, where SAP system is IFRS ready at transaction level, end-to-end employee actions from on-boarding to separation on SAP HCM, service CRM on .net platform with mobility solutions, pre-sales CRM on .net platform, legal compliance, risk management on .net platform, project planning and monitoring on SAP ECC6, Primavera, and MS-EPMS, decision support systems on SAP BIW and BO, as well as knowledge management portal on Lotus Notes.

However in bringing value to the organization through IT usage, there are a lot of challenges which Junnarkar had to go through including change management, process readiness, and people readiness challenges. For change management, an active support is required from business unit head. IT can focus on minimizing the impact, creating awareness, training people, and timely issue resolution. The resistance to change is a natural human behavior, and this can be conquered either by bottom-up or top-down approach. Bottom-up approach works for systems such as ESS, mobility, etc where employees see direct benefit for themselves. In majority of the cases, it is the business head who drives the change with ITs support, says Junnarkar.

Apart from this, process readiness becomes a major challenge when business is targeting the process of re-engineering through IT. People readiness becomes a challenge when users of the proposed system require detailed training on UI and functionality. The company faced this challenge during the implementation of estimation tools and project monitoring tools. The only remedy in this case was continuous refresher training by IT.

IT does bring value to Voltas and has been getting full support from the management. All our IT implementation projects have sponsors from the business side. Having a project sponsor from the business side certainly helps in getting the required support from the management. Also the majority of IT expenses are charged back to the business, based on usage. This also helps in increasing business involvement in IT investments. IT steering committee comprising of CFO and COOs review all IT investments, projects, and service delivery in quarterly review meetings. This forum helps in getting maximum support from the management, agrees Junnarkar.

The role of a CIO has undergone a dramatic change from the age old task of managing infrastructure to effectively managing SLAs and ensuring that IT implementations offer value. This makes him an integral part of every business decision requiring him to expand his knowledge purview beyond the horizons of IT details. And when it is the question about delivering effective value in less turnaround time, Subramanya C, CTO, Hinduja Gobal Services, says, Yes it is a tightrope that a CIO needs to walk and pull various threads to ensure that the functioning is picture perfect. On one hand, a CIO needs to ensure that all the SLAs are tightly defined so that the vendor meets his target with deliverables. And at the same time he needs to make sound investment decisions to ensure that there is a good return on the investment made.

The mention of IT delivering value also reflects the need to make good investment decisions. Subramanya feels, Leveraging on technology is the key behind effectively managing a company which even the management understands, so as a CIO, I have never faced any issues regarding funds. The reason behind this being that we have been able to increase the efficiency and offer better services to both the employees internally and the end customers also. And even the management is of the view that IT is an essential element that adds value to the business. CIOs need to use their funds effectively like opting for PaaS or SaaS as a Pay-as-you-Use model that will enable them to increase efficiency.

IT does make a difference and there can be no arguments about it and there is no better theory to support it than the fact that it has experienced a fast rate of adoption. Explaining this further, Subramanya says that the 500 individuals on a process can be effectively reduced to the benefit of the company. Using such benefits of technology will offer the CIO and his company on the larger picture a cutting edge over their contemporaries in the market.

At HGSL, there is a perfect case to support the theory that it is not hype ie IT adds value to business. HGSL had prepared a knowledge portal for a large telecom customer. Having worked with a well-known company in the vertical offered, this is the advantage enabling it to rake in more deals from new customers. Second case is where HGSL offered chat services with major elements, on a cloud based model which also proved useful to rope in new deals.

Finally I would like to say that IT has helped us to win good deals and also add values to our existing business, adds Subramanya.

With an employee headcount of more than 1,500 employees, Ramky Infrastructure could not have ignored the need for deployment of appropriate IT solutions in their organizational setup.

Being a diversified business group with interests in infrastructure development, real estate development, waste management, and international contracting, technology plays a vital role in the organization. Sunil Kumar Malhotra, CIO, Ramky Infrastructure says, Our operations are widespread and we go to multiple sites in almost every part of the country and internationally. So technology is the collaboration thread for the company. Currently, we are in the process of upgrading our IT infrastructure by creating our own data center and ensuring that the rollout of the standard as well as enterprise application should happen from one source.

Ramkys growing presence across India and overseas has resulted in the need for deploying the right kind of IT solutions. The acceptance of latest technology at Ramky Infrastructure is quite proative. The management understands and appreciates technology and supports it in terms of providing all necessary support of men, material, and time, says Malhotra.

For an infrastructure organization which is spread across all the 4 zones, the biggest challenge was to chart out a long term technology roadmap and encompassing the different aspects of their business. Since the organization is located at different sites, Malhotra had to ensure that the IT deployment was optimal at each office so that the organization functions hassle free.

In order to add more value and productivity to their buiness, Ramky Infrastructure had started deploying the required IT solutions nearly 4 years back but there are a lot of plans on their way. The organization has charted out numerous plans for deploying the right kind of IT solutions. Ramky will adopt some more technologies for the effective functioning of its widespread business. The first being a private cloud. Malhotra says, Since we are a diversified business group and we have a peculiar nature of activities in each of our business unit, private cloud would be apt for our business.

The company is also considering server virtualization, and most importantly the infrastructure company wants to get the mobile advantage. Ramky is willing to put all their enterprise applications into mobile devices.