Justifying an IT investment

(1666 words/7-minute read)

Weighing the Pros and Cons of IT Investments

When talking about justifying an IT investment, or really any investment for any reason, there are always pros and cons.  Time spent analyzing what you get with the investment versus what you currently have can often be more valuable than the money spent on the actual investment.  And this is especially true on saving both time and money to avoid investing in something that either was clearly not needed or failed to make the desired impact.

The Power of 'Why?' in Decision-Making 

I find it can be a much easier discussion and decision points if we're guided with a very clear why. Why are you considering this as an option? Why now?  Why not?  Why are we even talking about this?  Being clear on very specific, targeted reasons why you are taking or even not taking an action right now make it incredibly easier to handle all the decision-making involved.  Change comes with a lot of work and it's often a lot of decisions, especially if you're working with technology.

A Real-World Example: Moving Backend Systems

So let's look at an example that I'm currently facing. At the time of writing, we’re about to move some backend systems. Now why would we do this? Before I even get to the benefits and everything else you get from it, let’s ask a great starting question: Why are we even having this conversation?

Asking 'Tell Me More' to Uncover Opportunities

So here's the fun part. It did start with an opportunity.  An opportunity presented itself and I said “Tell me more.” That's a great question, by the way, to use throughout all your analysis work, no matter who you're working with or what you're doing.  I always tell all my analysts, project managers, and change agents, you need to ask good questions. One of those great questions is “Tell me more.”

Understanding Backend Systems: What’s at Stake?

And so I got a proposal about changing out the backend systems. And when I say “backend systems” that's like the infrastructure on how you run the business portion. So this is not what I do and deliver but rather the platform of where and how we track what is and is not happening in the business, our contacts, accounts payable, accounts receivable and all the other operational actions.

It sounds like maybe a heavy left, but because I have a smaller company footprint, it’s not too bad. But these are the very same questions that you would ask with any organization, small or even large multibillion-dollar companies. Your first ask should be to “Tell me more.”  So now comes one of my favorite and most useful questions after that: “So what?”

The 'So What?' Approach to Evaluating Value

Asking a “so what” question is how we ask about the value.  So what do you need to consider?  So what has not been talked about?  So what else needs to happen to make this work?  So what does this mean to employees?  So what does this mean to our bottom line?  Now you’re getting at the pros and cons, but from your position on value.  Not what the salesman is selling, but so what does this mean to me and my organization?  That’s the great question!

Layering Questions to Understand the Change Work

Once you get here, then we start layering on the questions around the actual change work.  When you know why, now you can ask the more details of what do you get with this change?  You want to ask what’s now, what is changing, what do you not get?  I love in the change work to understand these concepts through 4 ways of looking at things.

Avoiding the Shiny Object Syndrome: Focusing on the Whole Picture 

Too often the sale is only focused on not what you can do today, but with the ‘latest and greatest’ that the salesman is selling, you can get some great new features!  Don’t be distracted by the shiny object and look for the whole picture!  Know what you do today that you can still do tomorrow.  And in same way, know what you do not do today that you still won’t be able to do tomorrow.  Of course, the benefits of what you can now do are the highlight.  But then, and especially working across multiple departments and teams, know what you used to be able to do that will go away with this change.  I directly asked if there is something I do today that doesn't come with the proposed solution with our infrastructure replacement.   This is a very important conversation to help you see the whole value of the change work.  It also helps you scope the effort while understanding your current state.  The things we now can do are going to require significant work by your implementation teams.  But those items you will no longer do will require significant communication and change management work to ensure people remain on board with the changes.

Asking 'So Now What?' to Set Future Goals

See, it's all about these good questions and seeking understanding. I think a challenge a lot of us leaders place on these types of work is that we tie emotional or financial investments to our original solutions. They call these sunk costs for a reason.  They’re gone.  It’s all about the future, back to asking good questions that you need to ask “so now what?”.  Regardless what has happened, have a specific goal to the future of what you want to happen.  The goal setting is your criteria for making smart, informed decisions.

Focusing on the Goal: Streamlining the Business

Let’s go back to my challenge.  Why do the migration?  A future benefit would be the cost savings, which is often a good thing.  The goal, though, is to streamline the business.  We want to focus on automating and removing any reliance on manual processes.  We were interested because part of our goal is to standardize daily business operations in a smooth and systematic way that can be reported.  That’s the focus.  We then see benefits in the ease and quantity and quality of the reports we’ll be able to generate, but reports are not the goal. 

Great feature, not the goal.  Now a consolidated infrastructure setup that is less to maintain, and therefore leads to cost savings?  Absolutely sounds good!  And so if my goal is to focus on the business now I have great decision-making criteria.  When I hear about this opportunity, I ask if it’s good for the business with a focus on streamlining and optimizing to support years of future business.  If it does support this goal, then I’m definitely interested.  If it doesn’t apply at this time, then not interested right now.

Balancing Features with Ease of Use: A Goal-Oriented Approach 

Now, in my example, I’m told about how to get our website and other components looking as pretty as they do in our current environment is going to cost more and it’ll take some work that will not be covered under this initial opportunity.  Now the vendor can totally help me get these components over into the new system. And here’s where we had that conversation of what is and is not in the new solution.  The new solution would not be the same as I have now, but overall the needed functionality is there, but might have a few more steps than what we do today.  So I’m now worried about balancing features and easy-of-use, but then pause.  Go back to your goal.  My goal is to streamline and optimize systems.  So I ask if this migration and features would help us in achieving our goal of being more streamlined and optimizing systems for long-term success.  When we discussed the power of a single platform versus integrating multiple disparate solutions, now I get the information back to my goal.  Now it is easy to make the decision.  I’m not worried about the effort to get me there, but rather worried of removing roadblocks to hurry up and get us in the more successful future state.  But you have to have a criteria that makes these decision-making questions easy.

Asking the Right Questions: Key to Decision-Making Success

And your criteria is always founded on good question.  It's all about those great questions. And don't ever leave a meeting, especially with a vendor, but more importantly where you’re making decisions without asking everyone “What question have I not asked?”  That is one of the most powerful questions I use constantly. Because I'm not the expert on this migration example; the vendors are.  There's no way you can expect yourself to know all the questions about the solution the vendors are proposing because you're not the vendor, you're the recipient. You know all about your business. So you should be sharing as much about your business and asking how that translates in their work. You want that definition there. But what else have you not asked about on the impact of the transition? Well, you don't know that answer because you haven't done it before.  But the vendor has. You need the vendor to tell you what things have you not brought up yet that they've seen in their migration. What questions have you not asked about yet? Because you don't know. They do. Get them to give you more information. And don't worry about the answers. Just keep worrying about your good questions.  As with a solid goal, a ‘why’ to root your decision-making and then good questions to give you clarity on the entire picture of the work required, you set up teams for success.

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