In the following section we will address how you introduce IT cost and business value awareness in the organisation.
In order to emphasise the importance of change, we have elaborated the business and behavioural impact drivers.
Desired business impact:
- Control of IT costs to stabilise/reduce cost development
- IT resource effectiveness based on transparent and efficient KPI-driven IT cost allocation process through showback/chargeback of IT costs to top management and line of business
- Overview of the IT landscape and maturing of the IT landscape through application portfolio management, including application-specific development directions and prioritisation
Desired behavioural impact:
- Establish a culture of IT cost awareness due to understood and accepted cost allocation. The cost allocation will be based on a fair and transparent model, including change of business unit and affiliate behaviour with regard to ordering, maintaining and shut-down of applications/services due to cost focus
- Enhance IT cost dialogue based on business unit IT cost templates and adopt solid “explain or defend” rhetoric in reporting supporting a factbased IT cost dialogue in the organisation
- Develop ongoing IT cost practice with regard to data management, allocation, analysis, decision-making and management
The value drivers of the cost allocation can be related to exact key performance indicators (KPIs), which may govern the cost allocation initiative.
Co-creation – our preferred customer interaction form
For more than a decade, we in Implement Consulting Group has gradually developed our customer engagement and project approach, moving from expert advice towards a higher degree of customer involvement, and now has an elaborated and widespread co-creation practice as the DNA of the consulting practice. Hence, the customer has become an active and knowledgeable participant in a common process leading the engagement of the surrounding business network.
Co-creation was originally coined by the scholars Prahalad and Ramaswamy in their 2000 Harvard Business Review article “Co-Opting Customer Competence”. This idea has been developed further in their 2004 book The Future of Competition. Several other authors have contributed in this area.
Co-creation is an approach to customer interaction which emphasises the generation and ongoing realisation of mutual consulting firm-customer knowledge and value creation. An approach where the consulting firm’s and the customer’s resources and capabilities are combined and renewed to create value through new forms of interaction, service and learning processes. In essence, co-created value arises from personalised unique experiences with and for the customer.
In a cost allocation project, co-creation is introduced as having the customer involved in all activities from business need definition, process mapping and requirements development to design of application portfolio, data requirements, financial and application data retrieval, allocation mechanisms and mock-ups, in addition to change management preparation, development, testing and implementation, change management and further roll-out, impacting the execution speed, quality and value.