Does IT Improve Business Performance?

Optimize Magazine recently posted a new article in the  Business Leadership section, entitled, "Does IT Improve Business Performance?"  --- Evidently a new McKinsey study shows a "clear" connection between good business management and good IT management. 

The McKinsey study looks at 3 distinct areas of operations -- lean manufacturing, performance management (HR), and talent management.  It's not clear to me that their findings are accurate.

To review, their study of 100 manufacturing companies (in those 3 areas mentioned above) found that IT investments have little hope of making an impact on a company's bottom line UNLESS they are accompanied by first-rate management practices.

In my experience, sometimes effective leveraging of IT has an impact for the business regardless of management being perfect or "right."  To say that things have to be "right" proposes an atmosphere of caution and could inhibit a company from making an IT investment that in fact, could drive a bunch of change and result in improved business performance.

We worked directly with a manufacturing company's sales and marketing function -- putting together a sales portal and partner extranet that provided the information necessary for sales folks and partners to be more effective, AND hooked into backend CRM systems easily -- saved their sales people 8 hours per week of administrative overhead!  Allowing their partners to record their active deals provided visibility to the full sales pipeline that allowed the company to pay attention where it was needed. 

In fact, through NO or very little management changes (in fact some of the key management positions changed hands during this process) or having even the "right" management in terms of talent management or performance management -- but through effective IT implementation -- this company had it's highest revenue quarter EVER in it's 10 year history!  Now that is ROI -- directly from an IT investment, and fulfilling on the company's objective of increasing revenues dramatically.

So while we can have our heads in the clouds and look at perfect and right process -- there are effective uses of technology that can improve business performance -- you have to be looking in the right places.

Comments

[Business consulting]

It certainly often can improve performance, but even when it doesn't its still a necessity. Workers always screw stuff up and need constant IT support, regardless of what their tasks are, it seems.

-Marc