How to Win People
Chapter 2 / Competing with Information Technology ●
R EAL WORLD
CASE
C
1
How to Win Friends and
Influence Business People:
Quantify IT Risks and Value
IO Tim Schaefer thinks words do matter.
When he looked at the words IT used inside
Northwestern Mutual Life, he felt that they sent exactly the wrong message about IT’s role in meeting business goals. So, over the last 18 months, these words are out: IT costs, internal customers, IT leaders, alignment, and IT systems.
These words are in: IT investments, external customers, business leaders, integration, service levels, and IT assets. In addition, “IT and the business” is now referred to as “our business.”
“We came to realize we ourselves were building the wall.
We were distinguishing ourselves from the rest of the company,” says Schaefer. “We were somehow different. We had all this special knowledge. So this whole concept of black box, and the gap in the relationship, we came to realize was of our own doing.” As part of a broader change of IT strategy and culture, Schaefer has asked the top 150 leaders in IT to commit to being business leaders, not IT leaders.
Symbolic, semantics, and a whole lot of fuss? Sure—if IT continued to behave exactly the same way it always has. At
Northwestern Mutual, a life insurance and investment company with more than $155 billion in assets, IT has not. IT started by working very hard to put a real value on IT assets.
Although the process is ongoing, Schaefer says the company now knows it has IT assets worth “somewhere north of $3 billion.” IT can talk about service levels in terms that business units care about: Causing problems in the underwriting process costs $11,000 an hour in lost productivity, and problems that keep the field force from using their client management tools costs $25,000 an hour.
Schaefer’s goal is to get IT systems to be viewed as a business asset, with a value every bit as real as the buildings
F IGURE 2 .1
Being able to quantify the value of IT
R EAL WORLD
CASE
C
1
How to Win Friends and
Influence Business People:
Quantify IT Risks and Value
IO Tim Schaefer thinks words do matter.
When he looked at the words IT used inside
Northwestern Mutual Life, he felt that they sent exactly the wrong message about IT’s role in meeting business goals. So, over the last 18 months, these words are out: IT costs, internal customers, IT leaders, alignment, and IT systems.
These words are in: IT investments, external customers, business leaders, integration, service levels, and IT assets. In addition, “IT and the business” is now referred to as “our business.”
“We came to realize we ourselves were building the wall.
We were distinguishing ourselves from the rest of the company,” says Schaefer. “We were somehow different. We had all this special knowledge. So this whole concept of black box, and the gap in the relationship, we came to realize was of our own doing.” As part of a broader change of IT strategy and culture, Schaefer has asked the top 150 leaders in IT to commit to being business leaders, not IT leaders.
Symbolic, semantics, and a whole lot of fuss? Sure—if IT continued to behave exactly the same way it always has. At
Northwestern Mutual, a life insurance and investment company with more than $155 billion in assets, IT has not. IT started by working very hard to put a real value on IT assets.
Although the process is ongoing, Schaefer says the company now knows it has IT assets worth “somewhere north of $3 billion.” IT can talk about service levels in terms that business units care about: Causing problems in the underwriting process costs $11,000 an hour in lost productivity, and problems that keep the field force from using their client management tools costs $25,000 an hour.
Schaefer’s goal is to get IT systems to be viewed as a business asset, with a value every bit as real as the buildings
F IGURE 2 .1
Being able to quantify the value of IT