Bridging the business–IT divide needs a common language for understanding IT costs

At a recent event held in Century City, Cape Town, SME-focused IT managed services specialist Space Age Technologies revealed an all-new stratagem for modern small and medium-sized businesses to get the most value from their IT investments – called Relevant IT.

With the Relevant IT framework being so revolutionary, the visionary drivers behind the concept decided to narrow down the target market for this initial foray, and invited decision-makers from the region’s most prominent auditing firms to attend the presentation.

Predominantly consisting of individuals focused on financials, but also responsible for technology investment decisions, the target audience was ideally suited to the subject for the launch of the company’s Relevant IT-aligned Business Technology Cost Modelling service.

Comprehensive approach

Space Age directors heavily involved in the development of Relevant IT, including MD and solution-seeking engineer Mark Geschke as well as ex-auditor and now FD Ruhan Neethling, described the years of work spent developing this comprehensive framework, and specifically, the technology cost modelling – a service based on the framework. Titled: Unpacking the Black Box of IT Costs, the service models the IT environment, allocates all IT-related costs to a newly created standard set of accounts and presents the information to the finance head using a business intelligence dashboard. What was previously a confusing collection of technology jargon-filled costs is turned into a language which both business and IT people can use for IT investment and cost reduction discussions.

Most importantly, due to the standard categorisation and allocations introduced, this service will allow companies to compare their IT expenses with other companies in the same industry.

The pair explained the trouble finance departments face precisely categorising various technology outlays, and conversely, on the difficulty technology leaders have proving the value of any investments thanks to the communications chasm that exists between the two spheres. This disconnect has, through the years, come to be known as the business-IT divide, and this service is an important stone paving the path to finally bridging this gap in the SME space.

On Relevant IT, Mark Geschke: “We’re on the ground in Western Cape IT every day – we’ve heard the chatter in the industry about how IT investments don’t deliver on their promises. And it isn’t getting better, in fact, it’s getting worse. The fact is that many of the decisions taken by IT leaders have backfired in terms of delivering tangible business value. This has led to the perception that technology isn’t capable of delivering real value, and in turn has led business people to disregard IT as anything more than merely a provider of a stable working environment. This situation is a no-win situation for all parties, and the root cause of it is the business-IT divide.

“This break has to be mended. And with Relevant IT, we’re tackling the problem head on specifically in our target market segment.”

Understanding the journey

Several of the leading auditing firms in the Western Cape were represented by executive-level individuals. Nearly all of them comprehend the fact that IT should deliver more towards business value. However, to date, no clear solution has presented itself, especially in the small and medium enterprise space.

Colyn Donaggi of Henri Grove & Partners adds: “After watching this (the presentation), there’s no doubt in my mind that our technology costs need to be better categorised to effectively justify results to the business. At the end of the day, it’s all about controlling the cost, but the constraint I have is that as an auditor I can look at what might be a small IT problem and it can seem a lot bigger than it really is. So it’s great that this approach breaks down all the remedial action into manageable bites, but then ties this all together in the framework as a whole, already beginning the journey to eliminating that draining business-IT divide.”

After the revelations of the Relevant IT framework, attendee Monica Bandenhorst, who functions as both a financial manager and IT manager at Moore Stephens VDA, gave her own assessment: “In the dual role I fulfil, I certainly see the problems Relevant IT will address every single day. I’m always mediating between the clerks and the technical team – neither ever seems to even want to understand the other’s needs. I can really see the effort that has gone into this solution, and it’s also great to have Ruhan around to be able to frame things in a finance perspective that very quickly drives the point home!”

In summation

Despite obvious problems, so many IT organisations today continue to be less interested in solving customer problems than they are in selling solutions. Space Age Technologies has spent considerable time and resources on the Relevant IT framework specifically because it believes the interaction between business and technology has to change to yield future success. Technology must become as integral a part of the business as finance is today, and it believes this changing mindset will require a new breed of service provider.

Back in 2001, Space Age pioneered managed services into the SME market. The company intends to again be a leader among this emerging breed. In the end, it foresees the Relevant IT framework, along with services such as Business Technology Cost Modelling, being adopted by business across the globe as the new standard model for building technology systems which are fully integrated with business strategy – yielding new levels of value for the money invested.