Raytheon CIO: How to focus teams on business value

613 readers like this.

It’s easy for technologists to get caught up in adopting new technologies because they’re the latest shiny, cool things. However, doing so is also an easy way to lose sight of delivering business value. Don’t get me wrong, I love IT – but what I love more is delivering IT that makes a difference. At Raytheon, we are hyper-focused on delivering business value. Our technologists get to use and experiment with cool technology that helps the business’s bottom line.

To do this, we regularly remind the team that everything we do needs to fit into at least one of three buckets: growing the business, expanding margins, or mitigating a risk that’s important to the business.

Not all risk is created equal

All businesses today are trying to do one of two things: make money now, and make more money in the future. Good IT organizations focus on how they can support those objectives. However, these two things are not enough. Without effective risk management, you can’t stay in business today or grow tomorrow. The key is to remember that not all risks are created equal. When we talk about risk, we focus on risks at the Raytheon company level, not what the risk is to IT.

To succeed as an IT organization, teams need to focus on, and prioritize, what drives value for the business.

Here’s one example: An employee’s computer doesn’t start up one day. They are understandably unhappy because they can’t get their work done. While we need to get them back to full productivity, we don’t want to overreact and spend more money on a process to fix the issue than the cost of lost productivity from that employee. While spending that money to keep the problem from happening again might make us feel good about our service, it’s not something that actually helps the business.

That’s why it’s critical to talk about these measures in the context of the business. It ensures we’re not overspending on things that don’t deliver business value and helps us avoid chasing the shiny technology objects.

Build business value into your processes

Communicating these three elements to your team is important, but what also matters is building it into your business process. We’ve done three things at Raytheon to do this successfully.

The first place is at the front-end of IT when we’re identifying and assessing opportunities to make the business better. We’ve built our portfolio management process around the concept of value delivery rather than around other concepts that IT organizations might use, such as local productivity improvement measures. When we trade off opportunities against each other, we do so based on the relative business value they deliver compared against the amount of money they’ll cost.

Once we decide to pursue a project, we have a disciplined approach for planning and managing the business value through that project’s lifecycle. When there’s a bump in the road and we need to adjust, we are able to assess options in the context of which one preserves the intended business value the most.

Finally, we’re building business value maximization into our sustainment and maintenance discussions. Most IT organizations – even the really good ones – spend more than half of their budget supporting what they already have. During this phase, we focus on opportunities to do our maintenance and sustaining work in ways that create new value from existing things.

To succeed as an IT organization, teams need to focus on, and prioritize, what drives value for the business. That change in mindset isn’t always easy, but it’s effective. Evaluate everything you do against these three business value categories – growing the business, expanding margins, or mitigating a business risk – and build that framework into your processes to help ensure that your organization delivers business value in everything you do.

Kevin Neifert is chief information officer for Thales North America. Previously he was the CIO of Raytheon, where he spent 14 years in a variety of information technology, engineering and program management roles.