Digital Business Monitor: Strategic investment decisions

By Robbert Petterson

In my life as a consultant I’ve met a lot of organizations where IT was organized in the basement. These IT-basement companies saw this department as a cost center and did not want to invest too much in technology. This bothered me because I believe that if you organize tech and data in the right way you can create a lot of value for your business, your customers, your partners and other stakeholders in your ecosystem. But how to do this? At Anderson MacGyver, we believe that every strategic decision on your technology and organization starts with understanding the business. At our customers, we create the Operating Model Canvas in our own INOX tooling that visualizes their entire business with IT investments and applications. This powerful tooling allows us to start strategic discussions on board level to make smart decisions and really make impact. 

One of the questions we often get is: how do other organizations make their investment decisions? A valid question which in my opinion validates to be researched. Driven by my own personal curiosity, I therefore designed the Digital Business Monitor – a survey I sent out to over 600 digital leaders across Europe. The aim was to get a better understanding of the strategic decisions these leaders are making in the context of their business. 

Knowing that the business in every company is organized differently, I needed to come up with domains that are more or less recognized in every organization. Therefore, I chose to present five business activity domains that represent specific business activities that organizations do. Then I asked the digital leaders to distribute their digital investments across these business activity domains and the results were not what I expected. My assumptions were that digital leaders would invest most of their digital capital in development of products and services and in digital interactions with their customers. This would be the areas that make companies distinctive from their competitors. 

However, the results show that most was invested in the Business Operations domain. Although these findings could partly be explained by the need of investments in replacing their core legacy systems, most digital leaders viewed this domain as most distinctive. Apparently it is not always the front-end technologies and digital innovative products that have organizations stand out. A smooth and automated operational backbone may be just as important to achieve competitive advantage. 

If you want to know more about my other findings with the Digital Business Monitor, you can download the infographic with results here.
Read here more about a complex legacy IT landscape and technical debt.