"How much we spend reflects how much we grow" is the conventional wisdom of business. This is also true for IT spending, but IT demands more strategic thinking about how we spend our money – just throwing money at IT won’t necessarily support growth targets.
Most businesses aspire to revenue growth by expanding existing sales or through acquisitions. IT is a central enabler for revenue generation and how spending is managed is a good indicator of how determined the management team is to accelerate growth.
INDICATORS FOR AN IT-LED GROWTH APPETITE INCLUDE:
- Investments in innovation to develop new products.
- Engaging with specialist providers for services which require rapid scaling.
- Adopting an as-a-Service consumption model to be less tied to capital projects.
For larger organisations, there is also a strong correlation between rationalisation of existing systems and architectures with growth ambitions. IT can become very complex after years of meeting business demands and this can be a big blocker to flexibility and growth.
Related article: How to get more out of your IT budget
CAPABILITIES AND CONFLICTING PRIORITIES
We all have aspirations of what we want to achieve, but too often a lack of capability keeps targets in the distance. How IT spending is managed should be measured with what can be done with existing resources.
For example, if a retail business is looking to expand its network interstate and open 10 new stores (say 5 in Melbourne and 5 in Brisbane) it must assess whether its in-house IT team is capable of supporting the expansion or if a managed service provider should be brought in. Simply settling for what the organisation is capable of can also stifle growth.
It is also important to identify if growth will be seen as “more work for the same pay” by in-house staff. Engaging with a service provider can overcome this conflict and the business can better map the ROI of the growth targets.
We asses our clients' capabilities and priorities and identify ways to maximise your IT budget for now and the future.