Your company is “in the business of managing technology” but could likely be without guide-rails to align a framework to your traditional FP&A organization; IT need to “makes sense” to finance and business partners. After all, financial managers’ core responsibilities are to allocate capital through planning, forecasting, and investment analysis while having strong business partnerships.
Strong advocacy of “the IT Finance team” to propose a top-down organizational change such as the Technology Business Management (TBM) framework on to internal and external stakeholders and processes, is a serious undertaking with significant upside. An opportunity exists to enable transformation of classic IT-aligned FP&A organizations to morph in to something euphoric for companies who undertake the challenge.
As you consider your journey into accessing TBM resources, “taxonomy” has many layers to the core delivery model. These resources will help you be successful in evolving your framework implementation from variance manager to actionable value seeker. Keep in mind the following four stages of TBM progression:
- You are at the start of your TBM journey, at this website for help to build a proposal
- You’ve sold stakeholders and need to begin your journey
- You’re implementing the framework and starting to realize benefit
- Framework is implemented and marginal benefit continually generated – what comes next?
TBM is an IT enabler, business enabler and a working capital enabler. Consider the constraint on your IT budget within your company. IT spend (overall) is likely the largest expense your company has (outside of total salaries). A key component financial managers and CFO’s of IT bring to their CIOs and functional leaders is freeing up working capital and cash-flows to execute projects. In partnership with your business and choosing TBM framework, you will control costs, better manage invested capital and therefore create opportunities where your company can generate future cash flows on revenue aligned projects. TBM is a proven enabler.
There are many success stories with TBM implementations, as well as failures (yes, you read that correct). TBM requires attention (this is important), and with attention will come success. ExxonMobil, Clorox, Aon and a most recent announcement by the US government to partner with the TBM council to help control $90 billion in taxpayer funded technology are testament to what an enabled TBM strategy can bring when you are truly ready to transform your business.
“The first goal was to become the most financially transparent organization at the company. Think about that statement for a minute. I'm not in finance. There's a whole CFO organization that ought to have a goal similar to this. We're basically saying, ‘From an IT shop, we want to be as transparent as we possibly can.’ I'm really happy with the fact that I can say today, ‘Every single dollar we spend in IT we can tie back to the business decision that caused it.’ That's pretty powerful.”
- James LaPlaine, CIO, AOL