Building a Business Case for IT Spending

Survive Your Promotion

Tips for New Managers on Navigating the Transition from Individual Contributor to Team Leader Skip to content Home About the Book About Katy Recommended Reading ← The Currency of Leadership Evaluating Your Strengths → Building a Business Case for IT Spending Posted on December 7, 2009 by Katy IT management is a cost center for most organizations. However the level to which a solution is implemented is weighed against the cost of the risk it is designed to mitigate.

Leadership Caffeine Podcast-Bob Lucas on Customer Service

Management Excellence

For managers and executives, customer service is either a golden opportunity or, as some seem to treat it…a cost center. For managers and executives, customer service is either a golden opportunity or, as some seem to treat it…a cost center.

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Stay Focused During Meetings: Best Practices to Incorporate

Chart Your Course

To get the most out of this substantial cost center, employees and employers need to maximize attention and retention at every meeting. Americans have more than one billion meetings per year. At around $338 in staff salaries for each meeting, this amounts to a huge amount of money spent each year on meetings. Prime Your Brain Scientists define boredom as an inability to engage your mind with either internal or external processes.

Why Leaders Need To Stop Using Performance Reviews

Tanveer Naseer

They make the workplace more political, needlessly enforcing nerve-wracking centers of power. It needs to center on step by step improvement in how an individual is doing against goals, how a team is advancing by virtue of an individual’s progress, how innovation is being served by attitudes and decisions on a daily basis, and how an individual’s achievements are translated into outcomes valued by an employer.

Budget Management Best Practice 1 – Line Item Awareness

Strategy Driven

Other organizations are simply cost centers and the budget is a reflection of expenditures only. The primary organizational responsibility of every executive and manager is the diligent management of resources. This oversight is clearly expressed through the effective management of an executive or manager’s assigned budget. In many cases, this budget includes revenue generation as well as expenditures.

Complimentary Resource – Emerging Trends in Project Management

Strategy Driven

Among the trends are an increased emphasis on project management soft skills, the Project Management Office (PMO) being viewed as a potential profit center (vs. a cost center), sustainability aggressively planned into projects, and an increased emphasis on corporate social responsibility. Emerging Trends in Project Management. by Global Knowledge.

The Rainmaker Fab Five Blog Picks of the Week

Sales Wolf Blog

 My favorite: HR as a cost center.  My favorite: HR as a cost center. Maximize Possibility Blog Home Archives Subscribe The Rainmaker Group About The Rainmaker Group Chris Young Biography Contact The Rainmaker Group Get Daily Inspirational Quotes Maximize Possibility Blog The Rainmaker Group Homepage Alltop.

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The Changing Role of the CMO

Marshall Goldsmith

Many businesses view marketing as a cost center without recognizing how it contributes to the bottom line. Many marketers make the mistake of talking about lowering costs instead of talking about increasing revenue. Marketing is everywhere, but with the ubiquity of slogans and ads, it's easy to forget that there's more to marketing than meets the eye. As a result, it is often one of the first budgets to be cut in economic downturns.

Call Length Is the Worst Way to Measure Customer Service

Harvard Business

Given that the service department is a cost center in most companies, service leaders have long relied on AHT as a critical lever for keeping staffing levels, and therefore costs, in check. It’s not unusual to walk into a contact center and see “leader boards” and stack rankings publicly celebrating those with the lowest AHT and shaming the slowpokes. Most fear that doing so would cause call length to skyrocket, increasing costs.

The First Step to Fixing U.S. Manufacturing

Harvard Business

Many of the small and midsize manufacturers that did manage to survive kept going by cutting costs, which has led to stagnant wage growth. Some companies that built lengthy global supply chains have wound up with greater complexity and costs than they anticipated—not to mention greater exposure to a whole host of risks, including currency fluctuations, geopolitical disruption, delays, quality issues, and reputational risk. These costs are significantly higher for U.S.

How One Company Made Its Analytics Investment Pay Off

Harvard Business

GFNorte recently established a Central Analytics Business Unit (ABU) with the mandate to convert information into profits at a rate of 10X cost and to lead the adoption of a customer-centric approach within the organization. The results significantly exceeded expectations: In its first year the ABU yielded profits 46X its costs, in the second year 106X (equivalent to $275 million of net income), and during its third year it is on course to produce 200X. David Malan/Getty Images.

Your Company’s Energy Data Is an Untapped Resource

Harvard Business

Who at your company will be put in charge of turning buildings operations from a cost center to a revenue center? Cost Savings. Energy Information Administration, with a combined annual energy cost of over $200 billion. And many companies also face additional energy-related costs from their commercial vehicles, of which there are over 12 million in operation in the U.S. according to IHS, incurring fuel costs in the billions annually.

Why Marketing Needs Closer Ties to IT

Harvard Business

Like marketing, IT is often seen as a cost center rather than revenue generator. While many teams within your organization contribute to your success, one that cannot be overlooked or understated is the relationship with your IT group.

How Cybersecurity Teams Can Convince the C-Suite of Their Value

Harvard Business

I observed that leaders often treat security as a liability cost — until the company experiences a security breach, after which increased support is a given. Insight Center. Instead, it was forged by individual engineers and managers who recognized the opportunity to collaborate across the organization for improved performance, lower costs, and faster development cycles.

Future of HR: The Transition to Performance Advisor

LDRLB

HR is an enigmatic profession, as the authors write, “the sad reality is—even in today’s enlightened age of recognizing the value of people to the business—too many top executives still view HR as a non-strategic cost center instead of a core, profit-contributing function.” Most HR Departments have developed a matrix HR Structure with Generalists (Advisors or Business Partners) mixed with Specialists (in Centers of Excellence, aka COEs).

Ulrich 111

The Most Successful Brands Focus on Users — Not Buyers

Harvard Business

Usage brands, by contrast, elevate customer service and loyalty from resource-starved cost-centers to key drivers of growth and profitability. Ilka & Franz/Getty Images. What makes a brand successful in the digital age? A joint study by SAP, Siegel+Gale, and Shift Thinking suggests that digital brands don’t just do things differently; they also think differently.

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3 Mistakes in U.S. Health Care That Emerging Economies Can’t Afford to Repeat

Harvard Business

But replicating the facility- and labor-intensive American model — which is more costly than that of any other nation yet produces subpar results — will set these emerging economies on the same course of endless cost escalation that has plagued the United States. One major reason for the rapid cost inflation in health care is burgeoning hospital construction. Insight Center. Victor Albrow/Getty Images.

How Cloud Computing Is Changing Management

Harvard Business

“It’s already changing organizations, by moving IT from a cost center to something with a place at the table in a lot of different meetings,” said Chris Jackson, head of cloud platforms at Pearson, a global learning company. The cost may be lower, but like traditional computers, it is still a cost. Others use cloud computing software in their own data centers, as a means of increasing resources and working faster. yagi studio/Getty Images.

BPM 41

There Are 4 Futures for CMOs (Some Better Than Others)

Harvard Business

These efforts have enabled operational efficiencies, cost reductions, and greater agility, preparing companies for the next phase of digital transformation: driving growth. We expect the next few years will continue to see a lot of shuffling around in the C-Suite as companies turn their attention to growth, recognize the insufficiency of incrementalism, and place the customer experience at the center of their transformation. There are some new faces these days in the boardroom.

CEO 30

Morning Advantage: All I'm Askin' Is for a Little Respect

Harvard Business Review

For one, it’s a cost center. Marketers get no respect, writes Ivey Business School professor Niraj Dawar on INSEAD's blog. The CEO wonders how you spend your time, the CFO wonders how you spend the company’s money, the sales folks think you’re too conceptual, too abstract, and not sufficiently focused on the immediate business, and the production and supply chain guys just think you’re full of hot air.".

ROI 12

Your Company’s Energy Data Is an Untapped Resource

Harvard Business Review

Who at your company will be put in charge of turning buildings operations from a cost center to a revenue center? Cost Savings. Energy Information Administration, with a combined annual energy cost of over $200 billion. And many companies also face additional energy-related costs from their commercial vehicles, of which there are over 12 million in operation in the U.S. according to IHS, incurring fuel costs in the billions annually.

IT Has Finally Cracked the C-Suite

Harvard Business Review

In too many companies, IT leaders, relegated to their cost centers, are subordinate to other C-level executives. Just recently, InfoWorld magazine pointed out that CIOs have split into two groups: those who are driving value and those who are still trapped inside the data center. Recently I’ve been having a very hard time talking to students, executives, and business leaders about information technology.

CIO 10

The Internet Shouldn’t Run on Dirty Energy

Harvard Business Review

The internet may seem to exist in the ether, but its plumbing includes a vast network of data centers, also known as server farms, which need power to function. In 2010, data centers represented 2% of all electricity use in the United States. Leading companies are learning that sourcing renewable energy for data centers is a low-cost way to demonstrate commitment to global climate goals while adding reliability and predictability to energy consumption.

Shadow IT Is Out of the Closet

Harvard Business Review

Slowly but surely, as the little database grew bigger and bigger, the manager would wedge the cost into her operating budget. Show me an IT department at a 30 year-old Fortune 500 company and I'll show you a large group that is supporting increasingly costly, outdated, and unwieldy infrastructures with no time to focus on driving revenues and enhancing the company's brand. As CIOs pitch new IT projects and their teams undertake delivery, cost and effort estimates can vary wildly.

A Jobs Manifesto for Young Europe (and the Rest of the World)

Harvard Business Review

Government in its entirety is a cost-center to society, so we desperately need to create not just jobs, but private sector jobs. Europe's young people are bearing the brunt of the fallout from the collapse of the financial system and the struggle to save the Euro. In Britain, where I live, youth unemployment has topped one million. In Greece, the rate is nearly 50% — that's one out of every two young people in the country.

When an Inability to Make Decisions Is Actually Fear of Conflict

Harvard Business Review

It also has a huge impact on cost, productivity, and customer service. Similarly, when another company needed to reduce its expenses, the pain was spread like peanut butter across the different cost centers because the senior management team couldn’t reach a decision about where to focus — which meant that areas with growth potential lost as much muscle as those with less opportunity.

Make It Easy for Decision Makers to Approve Your Deal

Harvard Business Review

Similarly, the role of the dealmaker is to find a way to drive the “cost” of the deal down to as close to zero as possible — so the decision maker can’t possibly refuse to buy that ticket. In order to make it happen, you need to understand the dynamics of the cost of the deal. In my experience, this is where people go wrong — they misinterpret the nature of the cost to the person sitting across the table.

A Case for Why Health Systems Should Partner with Pharmacies

Harvard Business Review

The health care industry is now focusing on value-based care — improving the health of populations while reducing costs. The overwhelming majority of health care costs involve managing patients with chronic conditions such as diabetes, heart disease, and asthma. Even when patients are offered medications at no cost to them after a heart attack, adherence is typically not much better than 50%. Insight Center. Measuring Costs and Outcomes in Healthcare.

A Kodak Moment to Reconsider the Value of IT

Harvard Business Review

IT was viewed as noncore, a cost to be outsourced like janitorial services and security. But surveys show that more than 25% of firms still think of IT as a cost center, 53% of CIOs' time is focused on cost control, and 54% of companies outsource their IT services. It's easy to fall into the Kodak trap, especially in austere times when there's almost overwhelming pressure to cut costs.

CIO 11

Social Means Freedom, for Better or for Worse

Harvard Business Review

Typically an in-house cost center, service is usually viewed as a necessary evil and constantly targeted for "efficiency." Over time, notable service firms built outsourcing capacity in India, Malaysia, Singapore and elsewhere to allow any firm to have a global service workforce at low cost. Isn't This Just Another Way To Cut Costs? A Stanford Professor quit his job. But he doesn't plan to go to another prestigious university.

Bridging the Gap Between IT and Your Business

Harvard Business Review

IT is asked to the table far too late to advise on the difficulties of consolidating systems after a merger , then faulted when the task takes longer and costs more. We propose business and IT work in that direction by bringing a few tough technological trade-offs front and center, with the goal of finding some middle ground. Today, this topic simply doesn’t come up often enough, leading to a one-size-fits-all approach to managing IT, often as a cost center.

CFO 8

How to Compete When IT Is Abundant

Harvard Business Review

Rather than serving as an adjunct to the core business, or merely a cost center, IT is becoming intrinsic to the very products and services that every company offers. "You only gain an edge over rivals by having or doing something that they can''t have or do," wrote Nicholas Carr ten years ago in his controversial HBR article, " IT Doesn''t Matter.".

People Are Not Cogs

Harvard Business Review

Talent, purpose, culture and creating meaning is the peopley work mostly viewed by the performance folks as "cost centers," or departments that exist only to manage legal risk. Every day I go to meetings where language suggests people are cogs. With peers in a few CEO roundtables, I've heard things like: "I plan on hiring 3 biz dev people to get $345K per headcount in revenues."

Hamel 13

Offshore Centers Can Offer More than Low Costs

Harvard Business Review

Captive offshore operations centers — company-owned delivery units located in low-cost countries such as India and the Philippines — have come a long way. Originally designed to provide labor cost arbitrage, they are now on the brink of being a source for strategic advantage. Since 2008, we've benchmarked the performance of nearly 250 operations centers working on both core operations (e.g., Cutting costs Global business Operations

Develop Your Company’s Cross-Functional Capabilities

Harvard Business Review

On the other hand, they are set up as cost centers and service bureaus, mandated to meet the needs of all their constituents as rapidly as possible under the ceiling of their budget. Most companies struggle to differentiate themselves. The few that succeed are those which stand apart because of their distinctive capabilities: the things they excel at doing, time and time again.

Why Verizon's iPhone Could Be Good for AT&T

Harvard Business Review

We call these people Cost Center Consumers, and they come in two flavors. Divas: These are high maintenance consumers who drive costs up after purchase. They tie up your call centers, incur costly returns, and generate other costs that occur below the gross margin line, which is harder to see. calling plans, ancillary devices like headphones or chargers, international calling, home internet, cable) as well as their true cost to serve (e.g.,

P&L 12

Leading by Letting Go

Harvard Business Review

If you are running a large company anywhere in the world, you have almost certainly asked yourself some version of this question: “How can we get tens of thousands of employees to deliver memorable customer experiences that enhance our brand, all at a reasonable cost?”. In a customer service center, for example, you would create scripts for every possible interaction. To keep costs under control, you’d set goals for reducing it every year.

Obama and Romney Are Ignoring Hispanic Voters

Harvard Business Review

As founder of the Center for Hispanic Leadership, I can attest to the fact that the U.S. Full disclosure: I teach classes on this topic at the Center for Hispanic Leadership.) Think profit center, not cost center. According to the Center for Talent Innovation , only 5% of mid-level Hispanic managers have sponsors, as Hispanics have not been as effective at earning a seat at the table with senior executives.

Google's CIO on How to Make Your IT Department Great

Harvard Business Review

The standard approach is to apply tough cost control. That generally means that front line, in many cases, are the lowest cost of labor, who are generally working off a well-scripted common recipe of how to provide tech support. It''s actually a lower-cost approach, because it''s faster for a more tech-savvy person to resolve the problem. It turns out that this approach produces what I think is a virtuous cycle that brings costs down and customer satisfaction up.

Obama and Romney Are Ignoring Hispanic Voters

Harvard Business Review

As founder of the Center for Hispanic Leadership, I can attest to the fact that the U.S. Full disclosure: I teach classes on this topic at the Center for Hispanic Leadership.) Think profit center, not cost center. According to the Center for Talent Innovation , only 5% of mid-level Hispanic managers have sponsors, as Hispanics have not been as effective at earning a seat at the table with senior executives.

Top 10 Sustainable Business Stories of 2012

Harvard Business Review

Mega weather took many lives and cost over $120 billion in the U.S. Individual companies are feeling the bite: analysts at Morningstar estimate that input costs at Tyson Foods will rise by $700 million — more than its 2012 net income. So with life-and-death consequences and vast costs, we must have moved quickly to tackle climate change, right? Announcements on waste may not be exciting, but they demonstrate how companies can turn a cost center into a source of profit.