Microcurrency transforming the I.T caterpillar into the value delivery butterfly

So if data is the new currency (microcurrency), Information Technology (I.T) can be seen in a much clearer light. Information Technology therefore moves from a cost centre to a value provider or enhancer. That is I.T if correctly applied will turn your current data currency into an even more valuable microcurrency, a process of adding or leveraging the value of your data via I.T value engineering.

Now remembering of course that the purpose of business is to deliver value to customers, then it would suggest that your I.T should be adding value to your customers using the microcurrency of data. Obviously the data value your are delivering to your customers may not be the only form of value delivery, but it is an important part of the overall package value. For example Amazon.com delivers value in terms of convenience and data (user recommendations etc..) as part of any physical product it ships. Amazon ensures that it’s I.T delivers maximum value to it’s customers and that is how it makes decisions about what I.T to employ. It is also fair to say that different businesses offer different levels of data value to their customers, but it is also key to note that in any given market those maximising the data delivery components of the package are likely to provide greater value to their customers. With the obvious benefits that is likely to bring in terms of competitive advantage.

It is important to consider what information technology one employs or implements when focusing on customer value delivery. Historically much software has been built on the cost model rather than the value add model. Luckily that model is changing and I.T. is now moving towards service provision rather than software licensing. This is important as a focus on service provision is aligned with measured value delivery rather than some mythical ROI estimate that the vendor has conjured. When the service providers and internal value delivery network (formely I.T dept) are aligned on the common goal of customer value creation and or maximization, the business execution becomes economically focused, amplified and agile. The I.T performance can actually be measured, monitored, tweeaked and optimised to gain the maximum benefit for the customer and hence one’s strategic advantage.

Simplistic Delivery model

Datadelivered = ITstrategic + Datainput

and

Service = Human Capital + ITutility

Thus :-

Customer value delivered = Data + Service + Product ,

= ITstrategic + Datainput + Human Capital + ITutility +Product

Where product may be omitted in pure service organisations.

I would also suggest that strategic I.T be implemented as a combination of service provision and customization to provide strategic difference, enhancement and advantage. The types of strategic I.T service provision will vary but I would imagine some core services will include collaborative and communication tools alongside a new generation of analytical and even intelligent agents. Strategic I.T also favours multiple sources and customisation rather than single source, as that is how maximum value can be derived, unlike utility I.T where single source provision is likely to remain the norm. One other interesting point to those responsible for strategic I.T, you are likely to be sourcing your service providers much closer to those at the bleeding edge, you are in fact taking part in early adoption which is a very different position to your utilitarian counterparts. Further do not expect these service providers to supply R.O.I collateral like their utility brethren. Your focus must instead be on tacit knowledge capture and sharing, data transformation and leveraging as well as data discovery, these are good candidates for strategic data value advantage.

Innovation and trust will play critical and symbiotic roles for strategic service partners, so expect them to provide creative tooling on top of data standardisation and offer provisions upon scalable and trusted networks. In otherwords, expect these providers to supply innovative tools, yet have their operations running on proven trustworthy facilities or networks, then you get the best of both worlds. Also expect them to offer the flexibility to stage the provisions internally, collaboratively and externally in a seamless fashion. These providers should bend like the wind to your strategic requirements, but also operate symbiotically with trusted infrastructure providers.

As we peer into Information Technology’s crystal ball I see great opportunities for businesses focused on value delivery, greater value for customers and a golden period of I.T innovation around data as a microcurrency. I expect this to be fueled by a heady mix of entrepreneurs and developers, we really do live in interesting times.


Notes – Product itself may also have some indirect I.T component which could be indirectly expressed as : Product = Raw materials + Service

But I have omitted that for brevity, as I have also omitted the recursive nature of value add in service (serviceout = servicefactored + serviceadded)

*Note this post was originally posted here


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