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Research Alert: IT Organizations Face Challenges as Technology Innovation Becomes a Primary Driver of Business Value Creation

MIAMI & LONDON--(BUSINESS WIRE)--As IT organizations shift their focus to improving enterprise agility and driving innovation, top performers are finding new ways to drive value, according to new research from The Hackett Group, Inc. (NASDAQ: HCKT). But typical IT organizations face significant challenges in this area, and The Hackett Group’s research recommends organizations focus on a number of IT strategy areas in order to make the shift towards value-based IT management and improve efficiency and effectiveness.

“With more and more businesses looking to work directly with the cloud vendors, it’s critical for IT to be included in any discussions on how and/or what cloud solutions may be the best candidate for supporting the business”

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A public version of this research, entitled “The World-Class Performance Advantage: IT in the Era of Business Technology Convergence,” is available, with registration, at this link:

“The traditional way that IT creates value is changing,” explains The Hackett Group IT Transformation Practice Leader Mark Peacock. “In the past, business strategy and operational plans translated into the need for technology capabilities. Today, technology innovation has become a primary driver of business innovation and value creation. So the historic process has reversed itself, with technology-led value creation opportunities driving strategy while strategy simultaneously drives technology planning. This convergence of business and technology has made business relationship management a key skill, and increased the importance of IT planning.”

According to The Hackett Group IT Executive Advisory Practice Leader Scott Holland, “IT today has a historic opportunity to elevate its value contribution. But dramatic changes in culture and skill sets are required. IT organizations that fail to make the transition to value-based IT management will see their relevance erode as the businesses take control of their own technology roadmap, relegating IT to the role of a utility.”

While world-class IT organizations excel at driving greater business value, they continue to maintain a sharp focus on cost reduction. The Hackett Group’s research found that world-class IT organizations now spend 19 percent less than their peers and operate with 14 percent fewer staff, while delivering higher levels of effectiveness. World-class IT organizations also dedicate substantially fewer resources to “run” activities (55 percent vs 63 percent), and instead focus more investments in “build” activities (39 percent versus 30 percent). One key to accomplishing this is lower technology complexity, the research found...