How IT Investment Decisions Can Become IT Business Decisions (part 2) 
Published: Feb-06-12

As you transform your IT department into an organization that runs like a business, it is critical to behave like one. And nowhere is that more apparent than in the decision making process for IT investments, when your enterprise determines how it will use its technology resources. I’m Bob Kress, and this blog continues our discussion on running IT like a business. In this post I will give you a framework to develop the technology investment decision making process that will help your IT department become a respected and successful contributor to the enterprise.

Turning the investment decision exercise into a business decision making exercise makes the process less subjective and fragmented, and more strategic and holistic. A well-defined process can provide an objective rationale and approach for prioritizing and understanding IT investments in relation to the whole company. At Accenture we use our IT governance framework, which I described in my first post on running IT like a business, to efficiently and effectively vet the nearly 200 proposed programs that are presented to us annually. Meanwhile, participation from the IT steering committee ensures that senior executives stay connected to and accountable for their decisions.

At Accenture, it takes about eight months to go through the process of consideration, evaluation and decision making on IT investments, so we begin early in the fiscal year. We start out looking for big ideas. IT leadership reviews all the proposals looking for duplicative projects, common opportunities and major trends and themes, and then presents the IT steering committee with a summary. A short list of those projects that have received general consensus and support is developed. From there, detailed planning for each initiative gets underway and includes costs, benefits, timelines and the business case. 

A cornerstone of our investing process is our portfolio approach, which has enabled us to move our bias from concentrating our IT investment decisions on internal operations to focusing them externally to meet the needs of our client-facing sales and delivery teams. I talk more about this transition in my book, Running IT like a Business: Accenture’s Step-by-Step Guide. Here are the five broad areas of our investment portfolios:

  • Investments designed to support individual business units
  • Company-wide investments affecting everyone and everything in Accenture
  • Corporate functions – such as human resources or finance
  • Investments in pure IT functions
  • Investments directly dictated by legal and regulatory requirements

Our defined IT governance structure forced us to consider the company’s broader needs, and consequently we found better ways to invest our company’s resources while simultaneously improving IT operations.

How does your company make its investment decisions? Write back with your comments!


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