Outsourcing Techniques that Improve your IT Outcomes

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The most successful IT outsourcing decisions create truly innovative execution strategies that deliver meaningful business results. The outsourcing decision, however, frequently comes down to a cost-driven ROI calculation: how much will all this innovation cost us, and how long will it take to recover those costs? This is the wrong mindset and often the primary reason why IT outsourcing is generally underperforming.

Surveys from various industries have shown dramatic failure rates as high at 70 percent. Complaints come from both the clients and the service providers they turn to for the outsourcing. In one survey, more than 50 percent of buyers reported lower-than-expected economic outcomes. But service providers also complained about economic outcomes; specifically, about significant margin compression between 5 and 50 percent.

Read the full story in Data Center Journal.

Marketing: It’s time to make friends with IT. Here’s How.

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On August 6, 1991, marketing was changed forever by the birth of ‘Internet technology’. It was day one of the World Wide Web. The web would one day grow up to be the mechanism that not only gave the power of brand influence to the people, but inextricably connect marketing to IT.

The marketers we work with are well aware that their efforts can no longer be done without the support of technology. It’s odd, then, that marketing and IT are not more in-step with one another already. It’s time to move forward arm-in-arm.

Big Data is (Finally) Bringing IT and Marketing Together
Until the last few years, marketing could largely survive with limited interaction with IT. So long as IT kept the lights on, computers running and generated key business intelligence reports, marketing could work with their agencies and software providers largely independently.

Big data is changing all that. Today so much data is available within so many systems that batch reporting and third party SaaS is no longer sufficient. A rich, integrated view of the customer, using data inside and outside of an organization’s consumers is needed to compete.

The marketing team of a Fortune 100 telecommunications, media and entertainment (TME) company leveraged internal, open source and 3rd party data collaborating closely with their IT team to drastically improve price promotions with laser precision at the neighborhood block level. IT enabled marketing to allocate its existing media budget dollars more efficiently by and across regions as well as increase overall customer acquisition and shore up retention. It was a huge win. And it is exemplary marketing and IT collaboration.

Too many organizations still experience a chasm between marketing and IT collaboration. For your company’s survival, this has to change.

Find the common ground
There is often a fundamental disconnect between how marketing and IT approach projects. Let’s look at a customer experience project as an example that seeks to link an enterprise outcome of improving customer experience to measurable behaviors. This kind of outcome could require a complex solution that marketing thinks could be identified with a few key data points. But in actuality, IT may need to create feature-release parity across mobile platforms while improving quality through a technical framework that reduces labor hours or through “next-best actions” in a customer care setting using active decisioning.

Yes, that’s a lot to consider. And this level of detail to execute an IT-enabled marketing project is often the point of disconnection between marketing and IT. So, how do you reach across the void to collaborate more effectively with your IT team?

  1. Know what you’re asking for
    This seems obvious, but the traditional process of specifying requirements that IT executes on is too slow and not relevant in a big data/analytics environment where machine learning discovers correlations not surfaced by gathering requirements. Focus on outcomes such as how do I reduce churn or improve the targeting of my retention spend?

  2. Agree on measurable outcomes
    Understanding how you are going to keep score e.g., measure outcomes, enables the Marketing/IT collaboration to effectively evaluate candidate big data/analytic efforts. The team can quickly abandon insights that may seem valuable, but won't move the needle when measurable outcomes set the standard.
  3. Complementary strengths
    IT forces marketing to think systematically in order to achieve the outcome. Marketing forces IT to think about external benefits to the company. Work to each others strengths to  fully leverage these complementary skillsets to your mutual success and advantage.

Understanding how IT prioritizes their project portfolio
IT has to balance the maintenance of systems that keep the organization running with innovative projects that move the company into better competitive position. Ultimately, IT should have a portfolio managment concept, maintaining a “book of work” that looks across the organization to ensure projects are being completed in order of importance and urgency to the overall business’ success. That might mean the HR system overhaul that reduces new hire time from 8 weeks to 4 weeks because the company is shorthanded takes precedent over your customer experience proof of concept. Or a new billing system may more effectively capture existing revenue streams than the new stream you are trying to create and take priority.

One way to keep your projects a priority is by being a good IT partner, which means collaborating on outcomes and business cases. IT’s ability and interest in working with you increases when you help shape your projects for accelerated time-to-value and then partner effectively throughout execution by staying focused on the outcomes. In turn, your ability to leverage IT for marketing projects improves. In other words, that’s collaboration paying off. 

 

Restart your IT funding engines

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Stronger collaboration between marketing and IT can be the road to success.

Now that Google, Apple, Facebook and other muscle brands have revealed plans to enter the crowded field to win the highly coveted and competitive telecommunications, media and entertainment (TME) market, time is running out to restart your IT funding engines to ensure the tech geeks down the cube-riddled hall are firing on all cylinders.

This should be done to a large extent by revving up internal funding sources that can transform IT departments from cost centers to revenue generators.

Read the full article on CIO.com.

How to Fund Your Own Technology Powerball Jackpot

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Powerball is a popular topic in this country, especially when the jackpot reaches record heights as it did earlier this month. With money on my mind, I thought now would be a good time to discuss how telecommunications, media and entertainment (TME) executives can open up internal funding sources to transform their IT departments from cost centers to revenue generators that deliver exceptional value to their business teams. 

More than ever, consumers are asserting greater control over brands via their preferences and buying behaviors, driving marketers and technologists to focus online, then on mobile, and finally across all omnichannel avenues. Just as market leaders are catching their breath, the shift to ‘customer-first’—or acquiescing for all intents and purposes total control of the brand drivers—as the new table stakes. As a result, companies must move from driving the brand from within to nurturing current customers to entice and influence a net gain of customers. The tools exist to do this without gambling away future business success.

Belt Tightening Not Enough—Uncovering Internal Sources of Funding
Against this consumer-driven TME backdrop, how should the C-suite plan their business growth and IT investments while also needing to keep pace with rapidly developing technology advances and retaining their top talent? A good first step is for business leaders to closely reexamine their liquidity and working-capital strategy to fund their IT investments and long-term growth plans. For many, that will mean taking a close look at internal funding sources instead of over-relying on debt and other external sources of capital.

This may require company leaders to reorganize or shift IT resources and identify new capabilities that are needed to run IT as a more accountable profit-and-loss business that supports top-line revenue targets in new and better ways. IT must have its house in order to free up innovation dollars to support marketing and other business units taking advantage of technology advances to reduce customer churn and improve customer experiences.

Three Internal Sources to Fund Your IT Transformation

  1. Running IT as an Accountable, P&L Business
    Companies should make sure that IT is a well-oiled department that is more than aligned with the business and, in fact, is run like an actual business itself. At the same time, IT leaders should be held just as accountable for reaching sales goals, making marketing efforts more productive, retaining existing customers and obtaining new ones, project governance, and other critical business and financial objectives.

    Too often IT is running projects independent of company goals, creating pressure to support more and more applications and decreasing the efficiency of the team and budget dollars to accomplish corporate goals.

  2. Outcomes-based sourcing to utilize talent outside the organization and increase efficiency
    Many IT leaders believe they know outsourcing cold. But too often they don’t. At least not from an outcomes or value-based perspective. Outcomes-based sourcing contracts are hard to negotiate effectively, but highly impactful when done with both parties winning is kept in mind. Outsourcing done poorly can create drag on your organization even with the outside help. Outsourcing done well frees up your high-value talent to take on bigger, more meaningful projects to move the business forward.

  3. Insights-as-a-Service Model for competitive advantage
    Anything with “Big” in the names is likely synonymous with complex. Big data has yet to be fully leveraged because its large nature adds time, complex infrastructure and new skillsets to the analytical mix. Insights-as-a-service allows companies to bypass the complexity completely or in the interim while the bigger data support is being implemented. For less cost than building a data platform, and certainly at an expedited rate of weeks versus months or even years, Insights-as-a-Service models allows companies to buy answers without worrying about the infrastructure. This highly effective model has been used to move fast for quick wins within a quarter resulting in moving stock prices up.

Any one of these tools can open up internal funding sources and used together they are a powerful combination. Alone or united, these tools enable IT as well as the entire organization to be nimble. And nimbleness enables and fosters competitive advantage versus level-setting only to be on par with peers.

With Google, Apple, Facebook and other powerhouse brands set to enter an already crowded and hypercompetitive TME market now is not the time to sit back and wait for lady luck to be on your side.