How Your IT Department Can Provide Value in 2011
IT is often seen as a cost center, not a profit center. It’s a drag on profits, not an enabler of growth. As a result, IT managers should always be looking for ways IT to add value to the enterprise.
If you’re planning your 2011 strategies now, a new report from The Association of International Product Marketing and Management (AIPMM) and Accept Corporation may help you determine your direction.
According to The Return to Profitability: 2011 Product Innovation Priorities Report, which focused on corporate innovation performance and 2011 goals for profitability and long-term growth, executives are most concerned about translating strategy into reality (that is, aligning product strategy and business objectives), integrating the voice of their customers, and automating time-intensive and costly processes (including those with Microsoft Word and Excel).
In addition, innovation “is back on the priority list of most executives and has reclaimed its place as the top board room agenda item as this volatility and speed will require organizations to prioritize, develop, and take profitable products to market faster than in previous years.”
Among the survey results that should be of most concern is the high failure rate of products. More than half of executives reported that fewer than half of their product launches were successful over the last three years -- that is, they attained profit, revenue, and market-share goals). When asked why, executives pointed to their failure to incorporate the voice of the customer.
What’s getting in their way? Executives said sharing and collaborating on new ideas was their biggest challenge. They want to “collect and identify viable product ideas faster by engaging key stakeholders,” but they lack “the ability to collaborate with customers.”
Worse, customer feedback collection is “archaic,” according to the report -- sharing business cards at trade shows, with little organized follow-up. You’ve got to be kidding, right? Wrong. Roughly 45 percent of large organizations say they get fewer than half of their product ideas from customers, partners, and suppliers -- the very people whose brains you want to tap.
Communication was another common theme. Because of poor trickle-down communications, product developers are often out of sync with C-suite managers. Executives said that under half of engineering resources were working on the top management priorities. Talk about a disconnect. Over half of executives (51 percent) admit that there is a “probability teams are currently working on the wrong products and the wrong features to begin with.” No wonder product failures are so high.
When it comes to managing innovation, the report reveals more problems. Almost half (48 percent) of respondents believe their businesses will be running at a faster pace, and over a third (38 percent) expect more uncertainty and volatility. Yet almost 70 percent of companies are mired down using manual processes (using Excel and Word) to manage innovation, with no automation tools in place. That explains why automation is among the top priorities for 2011. With shorter innovation cycles, workers need all the relief from drudgery they can get.
The shift away from a project-centric toward a product-centric approach in managing project portfolios is one way many executives see they of adding value when it comes to product portfolio. In fact, 70 percent of respondents indicate they plan to invest in a product portfolio solution to maximize the profitability of their portfolio, create balance, and support their enterprise’s strategy.
How Will Your IT Department Respond?
As an IT manager, there are literally dozens of ways you can help executives.
Some are simple. Adding a feedback page to your Web site is one. Social media is all the rage, and enterprises are continually evaluating these sites to see how they can work to foster stronger customer loyalty and communication. Is this a technology you can use?
Given tight IT budgets, it’s good to know that solutions don’t have to be expensive. In my experience with a scrappy upstart publication, we found that a simple online survey program (a puny $50 investment) helped us get the best ideas -- from our customer base. Yes, there were the “completely agree” to “completely disagree” questions to gauge interest in predefined areas, but of most value were the open-ended questions -- “What three features would you like to see most?” -- provided the best feedback.
Yes, we received the less-than-helpful responses such as “You’re doing fine” or “Don’t change a thing.” That’s heartwarming but of little business value -- not nearly as useful as the roughly five percent of outspoken customers who offered concrete suggestions. We couldn’t execute all of them -- some we had rejected outright as impractical or far-fetched. Still, having open-ended questions let our customers get their creative juices flowing -- at virtually no cost to us. Collecting those ideas was easy. Organizing and prioritizing them less so, but tools exist to help with that, too.
When it comes to automation, I’ve long been a fan of DataPrompter from Wordsite (see my column from earlier this year) for automating monotonous Word documents. I’m investigating a new version of Dragon NaturallySpeaking, which claims it can cut some production tasks in half (or more). Desktop macro tools (a favorite of mine is Macro Express from Insight Software Solutions) cut down on repetitive keystrokes. Surely these and other tools are worth considering.
The report makes several suggestions that specifically target IT professionals, from investing in an easy, intuitive product portfolio modeling and planning solution to ensuring requirements are properly defined and communicated. Your customers -- your best assets, bar none -- are more than willing to share their thoughts. Just ask them.
The report stresses the importance of collaborating with your customers, including providing continuous updates. That’s easy and can be done at very little cost.
There’s considerable food for thought in the AIPMM/Accept report. The question is -- how will you improve IT’s contribution to your enterprise’s bottom line? The answer may lie in examining what executives say they need most.
The online research survey, conducted in September, received completed responses from 280 executives involved with product management, marketing, and development; nearly a quarter of participants worked at companies with over $1 billion in annual revenue. More than half of participants identified themselves as directors, vice presidents, or at the CxO level. You can download the complete report at no cost (though registration is required) from Accept Corporation’s resource page http://www.accept360.com/resources.
-- James E. Powell
Editorial Director, ESJ
Posted on 12/01/2010