Unrealized Potential

The latest McKinsey Quarterly came out recently and it reports on an interesting trend occurring in business across the country. These days, executives are looking to tap into what the report calls the "unmet potential" in software and IT. Business owners are pushing IT staff to squeeze more strategic value from software investments. My take on the McKinsey report is that companies that are making capital investments in software tools are less focused on business process, and more focused on the net effect of all of those processes.

As I read the report, I naturally think about our customers and prospects. A great many publishers we speak to have a limited view of information technology's possibilities within the scope of their company. They often see software and computers only as tools to perform specific functions, i.e., process orders, create invoices, assemble a page layout, and so forth. Viewed in this way, software infrastructure is strictly utilitarian and limited to mostly tactical applications. This viewpoint is so widespread that in fact, the most common "strategic" function seems to be running general financial reports for the CPA! That's old school thinking, and it's definitely time to change that perspective. Technology must become part of the strategic arsenal for publishers, just as it is for other companies. A great IT plan and infrastructure has the ability to literally transform a company strategically- and too many publishers are missing that opportunity.

The McKinsey report suggests that the economy seems to be driving the shift in IT spending. It's noted that one way companies are responding to economic pressure is by reducing IT operating (tactical) expenses, and initiating high-priority investments that support broader strategic business goals like improving the sales force and supply chain management. In response and in the context of our market, I'll point out that even before the downturn new media companies and technology-savvy content producers had moved beyond software as a desktop utility and implemented enterprise-wide platforms that consolidate data and make it a veritable gold mine that they've used to maximize revenue, trim costs, and take market share. So if you've lost market share due to more nimble competitors and now economic forces, perhaps thinking about the unmet potential of your IT infrastructure is warranted. With better strategic tools, you will be able to identify and seize opportunities.

It's time you demand more than simple utility from software. Demand that these resources deliver the unrealized potential: knowledge and competitive advantage.

http://www.mckinseyquarterly.com/ITs_unmet_potential_McKinsey_Global_Sur...

and another:

http://www.mckinseyquarterly.com/Information_Technology/Management/Manag...