IT Strategy

Overview

Axafina's Strategic IT Effectiveness professionals help organizations optimize investments, transform capabilities and achieve greater business value from IT.

Axafina research indicates that superior-results businesses view IT as a strategic asset—a source of both operational excellence and competitive advantage. Our Strategic IT Effectiveness (SITE) experts help top management adopt that mindset and achieve greater business value from IT. We have a clear perspective: IT is not merely a cost but a critical contributor to the business, focused on improving business value and performance. Our professionals are experienced with bold, value-creating approaches to IT, bringing boardroom-relevant criteria to IT investments and helping superior-results businesses to "think bigger" about IT's ability to improve operating results.

Where IT is a major driver of significant change—the establishment of shared service centers, business process outsourcing (including offshore sourcing), or post merger integration—the business rationale often focuses too narrowly on cost reduction. We take the view that such enterprises must deliver operational efficiencies predictably, but also deliver new business growth.

Creating Powerful IT-enabled Change

Where IT is a major driver of significant change—the establishment of shared service centers, business process outsourcing (including offshore sourcing), or post merger integration—the business rationale often focuses too narrowly on cost reduction. We take the view that such enterprises must deliver operational efficiencies predictably, but also deliver new business growth.

In fact, IT-enabled change lies behind some of the most notable contemporary business successes. As FedEx built not only a company but an industry, it developed and launched one IT-enabled innovation after another. The company's executive team understood that IT and the business enabled each other, and that IT would drive their vision of the new enterprise.

Focusing on Creating Business Value

Today's debate over IT spending often misses the point. It's not how much you spend, it's the way you manage your IT spending that counts.

Axafina research shows that superior-results businesses actually spend less than their lower performing peers on IT because they spend more selectively with an emphasis on value creation. The goal shifts from cost containment and reduction to improving the business's operating results.

Axafina's IT Value Discovery approach creates this superior-results focus by helping CEOs and CIOs with critical IT challenges, such as selecting IT investments based on bottom line return.

Optimizing IT Investment

In an economic downturn many companies freeze total IT spending or mandate cost reduction programs that eliminate the initiatives on which future growth depends. Recent Axafina research suggests that this indiscriminate approach to budget cutting almost always results in higher spending down the line; IT capabilities and productivity deteriorate and IT maintenance costs rise as supporting aging applications and technologies becomes more costly.

Conversely, in the race to achieve competitive advantage during boom times, IT spending sometimes grows unchecked, without the discipline that value driven investment planning requires. This approach can prove just as costly to business performance as sweeping IT cost reduction programs.

Transforming IT to Deliver Improved Capability and Business Results

Can a company maintain strong, competitive IT capabilities and still meet demands for reduced IT spending? Yes—by taking a bold, comprehensive approach that transforms every facet of the IT organization, from IT's connection to the business, to systems design, to culture and workforce performance.

Narrowly focused responses to IT cost and service issues are common, but the real payoffs come from top-level commitment to solving today's problems in a way that puts IT in the mainstream of tomorrow's corporate strategy. It takes an upfront investment, albeit a moderate one that pays off quickly and well.

Axafina's IT Transformation approach addresses the seemingly contradictory demands of maintaining strong, competitive IT capabilities while still reducing IT spending. IT Transformation can generate permanent gross savings in IT expenditure between 25 and 40 percent. Two-thirds of these savings would typically be reinvested into discretionary initiatives to optimize spending and build new business capabilities.

Why Axafina

We work with senior management teams to frame the fundamental business rationale for change.

By understanding the specific value levers that drive a company's performance, we are able to determine how to reposition IT to deliver against strategic business goals, dramatically reduce costs and improve operating results.

Our analyses go beyond traditional IT ROI metrics, taking the specific financial and operating context of each company into account.

These diagnostic tools give senior management a common language with which to assess and create IT-enabled value. This helps companies get smarter about IT investments and build new IT-enabled capabilities.

Axafina's Strategic IT Effectiveness experts help companies balance short- and medium-term investment agendas within parameters appropriate for the economic and competitive climate.

By challenging discretionary/non-discretionary IT budget assumptions, we work with organizations to devise clear investment road maps that establish selective, value-creating spending that makes a greater contribution to the bottom line.

The advantages of this approach are immediate:

  • Reduced wasteful or non-strategic spending releases funding for critical value- creating initiatives.
  • Capabilities preserved in the short term.
  • Capabilities enhanced within one to two years while the company's IT core is strengthened.

Axafina's IT Transformation approach solves today's problems in a way that puts IT in the mainstream of tomorrow's corporate strategy. We know how companies can harness IT investments to deliver business value by focusing on the links between IT investment and questions of organization, culture, financial controls and operating results.

Fundamentally, we understand IT organizations. We know how companies can harness them to deliver business value and help build the capabilities that enable superior-results. By focusing on the links between IT investment and questions of organization, culture, financial controls and operating results, we can help deliver improved business performance.

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