IT organizations create value for their enterprises; however, objectively communicating it to non-IT executives and managers in the economic level and bottom-line impact is a challenge for most people within the IT organization.
The Enterprise Value Creation (EVC™) methodology from Glomark-Governan enables IT organizations to effectively assess, compare and measure the value of IT projects, services, assets and programs, at any level, including the economic value level.
The following are some examples of the benefits of implementing EVC in an IT organization:
Objectively understand and compare the financial return of the possible new projects.
Understand the different types of value that the projects would create for the enterprise (i.e., operational, strategic, financial).
More confidence of expected outcome after the project implementation (economic and non-economic expected goals).
Ongoing proactive management of all selected projects will reduce budget overruns.
This same ongoing management practice will also help to ensure that the original scope of the project does not change; unless it is economically justified.
Track projects from an economic perspective (i.e., costs & benefits) to ensure projects’ success.
These will subsequently result in the following measurable economic benefits:
Eliminate projects with no ROI before implementation: 5% to 10%.
Increase overall ROI by selecting the best projects: 12% to 30% increase in IRR (average increase within a portfolio).
Select the projects with the best value; resulting in an increase in the net margin: 5% to 8% (from projects).
Consider and evaluate scenarios (i.e., the best scope and implementation strategy based on value creation); optimizing the right scope of projects, and reducing total cost of ownership from 3% to 8%.