How to Prioritize Business Technology Investments

Regardless of the size of your organization, the demand for business technology investments always exceeds available funding. If the goal is to leverage technology in order to bring the greatest possible value to the business, what is the best way to prioritize these investments? It should start in the very early analysis of each possible business technology investment candidate so that decisions are ultimately made in a level playing field.

1.  Start with requirements that focus on metrics that are likely to be substantially impacted by the new technology. Let’s take a 50% improvement in manufacturing operational efficiency as an example.

2.  Now monetize that impact based on your knowledge of the business. Will this business technology investment allow you to reduce staff, postpone hiring, reduce scrap or inventory?  How will faster manufacturing throughput impact sales, customer service and brand? Consider the entire business and not just the area directly impacted by the business technology investment.

3.  Next, develop an ROI based on the impact to the customer. After all, is this not why the organization is in business? An improvement that delivers benefit to the organization only, without delivering additional value to customers, it generally not worth doing.

4.  Top Executives or the Board of Directors now have a consistent means across the enterprise to evaluate the relative importance of different business technology investment proposals. Is a 50% improvement in manufacturing efficiency strategically more important to the business than the other proposals on the table?

5.  After deployment, what are the performance metrics worth monitoring closely? Those that focus on meeting the target improvement in manufacturing operational efficiency. Continuously improve until that target is met.