Why IT is a Predictive Investment, Not a Cost

by | Dec 22, 2020 | Technology Strategy

Information Technology (IT) is traditionally seen as a cost center by many organizations. It is no surprise that in those same companies the CFO usually oversees the IT department. Fortunately we are having more conversations daily with CXOs who see IT as a competitive advantage rather than a cost center.

Technology can be a tool you use to enable your business to succeed, and a utility you reply on to improve employee productivity. Executives who involve the IT team in meetings with other departments (such as finance and legal) can save money on unnecessary IT expenditures, catch security concerns, and be prepared to meet reporting compliance requirements.

IT’s presence in these types of meetings can prove advantageous in more ways than one. When included they can provide a powerful voice to help the organization leverage technology, which ultimately provides better alignment to the organizations stated goals.

Integrating IT

A company’s needs are best served when their information technology department is integrated with every department. This means inviting key IT stakeholders to meetings with human resources, finance, legal, production, and any other department which depends upon IT. In other words, every department. These meetings promote cooperation and help align the values and vision of your company across teams, so they work towards common goals. These meetings can also help expose flaws in your company’s working patterns.

With IT’s insight into departmental challenges, lingering issues can be analyzed and resolved from a more technical standpoint. As an example, if finance or production aren’t receiving accurate or timely data, then IT can analyze the reporting method and improve the flow of important information to those departments. IT investigates issues such as these to explore what is being held up, or incorrectly processed, and why.

Besides being an asset for remediating long-standing problems, IT also can mitigate issues before they occur. Predictive analysis allows departments to remove delays and streamline processes before something goes wrong. The presence of IT in departmental meetings allows for the technical assessment of processes and strategic recommendations for avoiding any unwanted miss-steps before a project is started. Additionally, IT could provide guidance around reducing costs by leveraging automation.

But what does this mean? For starters, investing in technology can save your company money. Long standing problems will be fixed, technical debt will be addressed, and problems can be resolved before they occur. As a byproduct, departments will work together and communicate their needs towards achieving common organizational goals. All of this adds up to less time spent waiting for resolutions and less down time when an issue does occur thereby enabling the business and ultimately gaining a competitive advantage. Despite the idea of spending more money on technology running counter-intuitive to saving money, with proper planning technology will end up costing the organization less.


Now more than ever, spending money on technology is a predictive investment. Within any company, reports are produced calculating growth, revenue, and operating costs for the year. Part of those operating costs may include electrical usage, water usage, or rent. These are all considered necessities and utilities. Technology is more than a utility line item to keep your business running, but it is just as important.

As your business grows, so does the workforce and their use of business materials and utilities. Investing in more office space or paying more for electricity typically is factored into the operating budget. You wouldn’t crowd employees into shared cubicles or have them work in low-light conditions, so why have them use outdated technology resources? Highly qualified employees can only be as efficient as the business allows them to be.

To think about this in another way, school children using textbooks from ten years ago would not be expected to perform at the same level on a test as students using the newest materials. So, an employee using a network or laptop which hasn’t been upgraded in ten years would not be able to produce the same work as an employee with access to more reliable equipment. Organizations need to provide employees with the necessary tools to succeed.

Suppose you look at the technology in your office as you do your car. Regular maintenance, oil changes, replacement part installations, and tire rotations are performed on your car. These are predictive costs which are factored into your budget when you own a car (not to mention gas and insurance). However, you also view your car as a means to make money since it is used to travel safely to the office, so it is not a drain on your budget. The same expenditures should be applied to your IT department. Without preventative maintenance, replacement part installation, upgrades, and monitoring, the technology in your offices cannot be expected to perform in a dependable manner to help your company succeed.

IT Investment Decisions

Allocating appropriate resources to your information technology requirements, to not undercut your team’s ability to perform and support the business with quality workers and products can be difficult. Technology should be used as a branch of your business capable of analyzing and strengthening your processes and a service to leverage productivity. It should be seen as a core competency and not just another cost center.

By leveraging technology throughout the organization and employing it as a problem-solving tool it becomes easy to see the expected return on investment. Treating technology as a necessity and principal mechanism in your business will help your company run more efficiently and give you a competitive advantage over the competition.

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