Saturday, January 27, 2007

With IT budgets slack, delivering business value is paramount

Platt, who has been doing some stellar thinking recently about this new way of looking an software architecture, goes on to note that:
The interesting use of Web 2.0 in business is in CRM or more specifically Customer

Lifecycle Management. Typically CLM is too expensive and long drawn out to be
able to do effectively so organizations have tried to do a cheap version which
fails. With the use of Web 2.0 social and community techniques however now CLM
can be done effectively and efficiently. This is where Web 2.0 will impact
organizations the most.

And use of Web 2.0 techniques to service customers is part of where a lot of thinking is currently aligning, around business value across efficiency, revenue generation, deep automation, and execution. And in my opinion, this is subtantially the subtext of the Gartner discussion on initiatives for sustaining IT:

  • Control is moving to the business. No longer content or able to wait for IT to solve problems, business units are increasingly comfortable in self-service IT techniques. This is particularly true given a new wave of younger workers who expect more personal control over their IT systems and have both connection to the business and are generally highly tech-savvy.
  • Smaller investments allow new problems to be solved. An business problem that was solvable using older, heavyweight IT techniques for $1M could only solve problems where the return on investment would be greater than $1M. If that problem can solved for $10K today using Web 2.0-style architectures, it opens up a whole new wave of IT value. I sometimes refer to this The Long Tail of IT Value. The mass self-service of these often untapped micromarkets within a business are potentially large.
  • Relentless Transactional Automation. Rote business processes should be and will be automated extensively over the next few years, freeing up employees to be inserted into the most high-value processes that require human intelligence.
  • Increasing Dynamic Decentralization of Execution. The new social, collaborative tools allow ad-hoc and emergent teams to network, form, and execute business processes as needed. This leads to the increased invovlement of people at the key points in the process, something Gartner emphasizes as well.
  • Tacit Customer Relationship Management. Automated customer self-service is as critical for transactional business processes as ever, but this has been done in a relatively tone deaf fashion up to this point and it’s been an all-or-nothing process for the most part up until now. Traditional CRM and CLM hasn’t been responsive or malleable enough and often prematurely optimizes the process, fixing automation or personal interaction at the wrong places. Tacit CRM means being able to provider personal, effective customer solutions in a cost-effective way using a combination of automation and systems. Getting it right means getting or keeping the customer. Getting it wrong means handing your customers to your competitor. I’ve written recently about transactional vs. tacit business processes, and it’s one of the most important parts of Web 2.0 in the Enterprise.

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