If your organization is typical, then you spend anywhere from 4%-9% of your annual budget on technology projects. The key word here is budget. If your focus is on a budget, then the way you plan your technology projects will inherently be centered around the cost of those projects. Though we typically accompany these projects with lofty rhetoric identifying the benefits of doing this project the reality is that we don’t quantify outcomes and the focus of the project management of these projects is on budget and scope.

To begin to reshape your mindset that emphasized cost, you need to adopt a modern investment theory that quantifies both the risk and return for specific investments (aka stocks or bonds) that are part of an overall portfolio of investment. To apply an investment approach, you need to view your organization as a portfolio that would include work to enhance business capabilities, and process improvements, as well as to ensure your infrastructure is stable and up to date. A portfolio is a diversified set of individual securities (eg - technology projects) that have a portfolio objective associated with it that defines the risk and return that the organization is willing to accept as managing their investments.

By moving to an investment mindset, you change your focus towards quantifiable outcomes that are strategically aligned as defined by your portfolio/organizational objectives. Too often annual planning processes concentrate almost solely on the cost of the project. Making investment decisions based primarily on cost, we miss the important value conversation that must come with it. We need to know if the cost of acquiring the value exceeds the value returned. We want to make informed decisions before investing. This is the only way to maximize ROI.

My QValue Technology Investment Model provides organizations the ability to quantify both tangible and intangible value so that we properly diversify our IT investment across the organization.