Hewlett-Packard executives believe that a tipping point has been reached, and we are entering a new era. "Technology is moving into a new context--IT as we know it is over," Deborah Nelson, HP’s Senior Vice President of Marketing and Alliances Technology Solutions Group. What comes next is "Business Technology."
"Just like many phases before--data processing, MIS and the IT phase we have been in--we are now seeing technology running every aspect of business, taking orders, hiring employees, checking inventory, getting the latest news. You can't do it without technology,” she told me. “We need to think about technology and how to measure it in fundamentally different ways. Instead of hardware uptime, response times and service-level agreements, we need to measure in terms of the business outcomes they achieve, such as how fast to profit for new store or to deploy a new financial service. We view this new phase as 'Business Technology.'
The switch from Information Technology (IT) to Business Technology is a bit of slight of hand, given that the industry has been preaching business and technology alignment talking about giving CIOs a seat at the business planning table for more decades.
Nelson acknowledged the notion of “Business Technology,” thinking about and measuring technology in service of tangible business objectives, is not revolutionary or unique. “It’s definitely an evolution and an emerging trend. But, we need to be out in front and lead for our customers. The vast majority of budgets are 70 to 90 percent tied up in maintenance and operations. We have to think about technology and competitive advantage, not just keeping the lights on. We want customers to feel this urgency--it’s strategic, and not a cost reduction concept, but a way to help IT deliver better business outcomes."
This objective, in part, is freeing up money to invest in innovation rather than in keeping the lights on. Nelson told me that only 10 to 20 percent of companies are far along the path of shifting from an IT focus to a Business Technology focus. "It’s a new way thinking and measuring," she said. "The majority of IT departments are still keeping the lights on and managing day to day business. They don’t have a seat a strategic table to impact business outcome.”
According to a recent HP study, 99 percent of CEOs agree that technology is integral to the success of their businesses, but only 32 percent of their CIOs are involved at the inception of strategic planning.
“We need to get the rest of the market to internalize this and move," she added. “[The shift to Business Technology] is meant to provoke and help lead into a new phase. All customers need to care about this. It’s not simply a CIO message. It’s very important that all parts of the an IT organization understand and translate how what they are doing impacts the business in business terms. It’s an absolute imperative to help customers have the business conversation and do the translation of the technology investment to business outcomes.”
"We have been preparing the portfolio and organization to make shifts to better serve customers. “For example, the Mercury acquisition gives us, along with OpenView, the ability to help customers understand and measure technology investments.
The company is making several announcements around its new Business Technology theme to make it more concrete. Today at its Technology@Work conference in Berlin, HP launched new solutions and services across Business Information Optimization, Business Technology Optimization and Adaptive Infrastructure areas.
For example, HP is now shipping HP Neoview, a new data warehouse solution and introduced new business intelligence services for strategy and planning, information integration, Iinformation delivery and information quality. The company also introduced new Adaptive Infrastructure, which provide a model for building modern data centers, reference architectures, including for Microsoft Exchange 2007, Oracle and SAP. HP Adaptive Infrastructure Maturity Model offers account-specific service that produces a roadmap of how best to evolve to a desired future state. New HP IT (why not BT?) Shared Services, which includes Realization Centers to educate customers on best practices for building infrastructure and HP Shared Infrastructure Utility QuickPOC Solutions for doing proof-of-concepts for customers.
The Business Technology theme is a case of HP eating its own dog food. HP CEO Mark Hurd is all about measuring outcomes in running HP's business, and so far his focus on the numbers and measurement, rather than the technology itself, is paying off. Now HP wants to pass the best practices and philosophy along to customers, which will further help the company meet its measures of success.