How Executives Fail Technology Data 101

Nobody recalls Joe Friday , the character from Dragnet’s old TV show and not even me. 5However, when I heard the expression “just the facts, ma’am” in the past, I searched on the internet. It turns out that the detective of the 1950s was always straight to the factual. For those who are interested (which I’m sure there aren’t many of us Dragnet “started out as a radio drama program in 1949, made the transition to TV in 1951 (and aired in both media simultaneously through 1957), became a famous film in 1954, spawned a revival TV series and made-for-TV movie in 1966, was spoofed in a 1987 movie starring Dan Akroyd and Tom Hanks and was spun off yet again (after Webb’s death) as a new syndicated series in 1989.”(This Joe Friday guy – also known as Jack Webb – had quite a long time on the air.)

Dragnet is indeed something to be concerned with. Joe Friday often has said to female witnesses”just the facts, ma’am.” “Just the facts, ma’am.”Aside from the obvious sexism implicitly implied that plagues the 20 century and early 20th twentieth-century news media, Joe Friday never actually ever said “just the facts, ma’am,” even though the words he used were similar enough to refer to the subject in question that is, facts. In this instance, the points include data on technology and its financial connection to its service company.

Rich Company/Poor Company

I’m not going into names. However, I can tell you that many CIOs, CTOs, and CDOs I’ve had the pleasure of working with throughout time (including myself) were unable to answer even the most basic questions on financials regarding their spending on technology and its impact on their business or strategy. They couldn’t even create an online dashboard that would show them where their money was going. The same isn’t only the CDOs or CIOs. Other C-suite executives aren’t able to answer these questions. Not many can.

Do you think it is challenging to answer these questions? Not at all. Why are the answers so elusive? (We’ll return to this question in the future.)

Basic Technology Questions

Big Question Mark — Where’s the Data?

What are the key issues? These are the seven. There are others. However, these provide the essentials.

How Much Funds Is Spent on Digital Technology Every Year?

It is needed to understand the total amount and the proportional allocations among the various categories of hardware, software communications, support consultants, etc. However, it is also essential to know the allocations across other specific areas of importance to your business and industry, such as security and privacy in the financial sector and supply chain management and planning in the distribution and manufacturing industries. These days, it’s crucial to know the details of the exact amount and location of the money spent on cybersecurity, regardless of the field.

What % of Revenue Is Spent on Technology?

These numbers are crucial to know whether you’re an operating person obsessed with reducing costs and strategic spender looking to gain competitive advantages from investments in technology. Companies that invest their revenue from gross investment in technology per year within their field tend to be operationally focused, which is the management of technology as a cost center. If people within your company guss about how they use technology to improve their strategic position, however, they spend less than an industry-wide percent, they’re not real. Businesses that pay more than their peers in the industry tend to be strategic investors. The primary metric to consider here is how industry-specific spending is different. Industry-specific variations are revealing. Specific industries invest less than 8 percent of their revenues on technology, whereas others like cloud and software spend much more. The most critical measure is the place where a business falls within the industry norms, such as software companies (25 percent of revenue) cloud companies (16 percent) Financial service companies (10 percent) Services companies (7 percent), retailers/e-commerce firms (6%)) and consumer product companies (6 percent) Transportation and logistics companies (5 5%)) and healthcare companies (5 percent) and industrial companies (4 percent). Which company is yours, along with these industry norms?

How Much Is Spent Per Employee?

The actual numbers range from $3K to $50K per employee. In exceptional situations, the top end of the spectrum isn’t usually a good idea, such as rash a security breach. The most crucial thing is to segment your spending. For instance, are the funds going to security, communication, hardware, or consulting? sectors? The trends in spending here are crucial. This metric is comparable to the cost per square foot of real estate, which most of us are familiar with.

What are Direct, Indirect & Adjacent Competitors Spending?

If your competition is spending double what you and your peers in the industry are spending, it could be a sign of several things. Perhaps you’re spending less, or maybe they’re spending too many dollars. Competitive intelligence can be worth every cent you invest. It is essential to know what your competitors are paying, how they’re spending it, and the trends in their spending. Segmentation is another wise best friend.

How Much of the Technology Statement is Discretionary Vs Non-Discretionary?

Do you have any room for flexibility in your financial plan? If your Superior came into the office and asked for $500k to fund a strategic initiative, could you come up with the funds? For a tactical project? Do you have the bulk of your budget for technology in the year already budgeted for, and is there space for special projects, pilots, pilots, etc.? The so-called entrepreneurial programs are typically underfunded in budgets that are small in discretionary. Financial agility is a plus, particularly in light of the extreme volatility of digital technology.

What’s the Return on the Technology Investment (ROI)?

It’s crucial to know the total cost of communications, applications cloud, and more. to determine how much funds is spent and how significant it can be. There is a list of the three top priorities for spending across different industries to understand the impact of digital transformation (54 percent) as well as cybersecurity (49 percent) as well as cloud-first/cloud transition (40 percent).

This is model heaven for many of your friends and enemies in your circle. ROI calculations are essential to the success of all budgeting methods. If you don’t track ROI using explicit operating or business metrics, it’s impossible to determine the effect of your investment in technology. If there isn’t a standard ROI method in place that you can follow, you must develop one with the financial personnel at your business. What’s the return on investment on digital transformation, cybersecurity, or cloud-first/cloud migration?

How Good are the Technology Leaders?

This may be the most difficult one on the list. It’s not because the data isn’t readily available. However, the ROI overall will likely be low or even worse. If this is the case, there’s likely some blame on the team. In other words, if the annual ROI is low, then it’s time to change the team. However, most businesses are reluctant to take this step, which is logical due to various personal and professional reasons.

Why Companies Fail Data 101

When you have the answers to these queries, place them on an online dashboard that everyone can look at – unless the answers are not what you believe everyone should be seeing. If the data is hard to locate or, even more important, be able to explain, you should consider the reason this is the case. Likely, “technology” is not a first (second or third) expenditure priority as was suggested just a few minutes ago – unsupervised. If data reveal alarming trends, solutions based on data are easily visible. The first step is to make the data a mess to make it difficult for anyone else to see how awful things are. Otherwise, all this information would be floating around on the tip of everybody’s tongue. There may be a data shortage because businesses have poor internal analytics or their dashboards aren’t as good. No one may have ever connected spending trends to the efficiency of their operations or strategies. It’s likely, but extremely unlikely unless you go back to the time before data-driven decision-making was an option. However, who knows how many top executives remained in 20 century? Century. Does anyone have an idea?

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Adam Collins
Adam writes about technology, business and economics. With master's degree in Economics, he's presented six papers in international conferences. As a solivagant in the constant state of fernweh, curiosity is the main weapon in his arsenal.

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