Second Opinions

The Five Biggest Mistakes by Big Firms

By Sally R. Gonzalez

1. Failing to develop a technology strategy -- and live by it.

CREATING A formal, written technology strategy is hard work. It begins with understanding the firm's business goals and objectives and then determining how technology can further those goals. It provides the long-range framework for ongoing technology decisions, helping the firm to set priorities and understand the funding and resources needed.

Ironically, even those firms that do create a technology strategy often treat it as a one-time effort and fail to live by it. They neither update plans to keep pace with changes in business and tech environments nor use their strategy routinely to guide specific projects and measure progress. Firms that fail to invest time and resources in creating and living by their strategic plan are likely to find themselves mired in a plethora of competing projects that lead in no coherent direction. They are fated to hear their partners asking, "Are we getting value from our technology spending?"

2. Viewing technology spending as a cost rather than as an investment -- and missing important opportunities.

Whether firms like it or not, technology spending is a competitive necessity. Firms that will succeed over time are those that consciously decide to invest in their business through technology spending, and then develop management approaches and structures that ensure that this money is invested wisely and high value services are delivered. These firms understand that the current economic environment, challenging as it is, offers significant buying opportunities and they are positioned to seize them now.

Firms that view technology spending as a cost and manage it solely as administrative overhead will miss these opportunities and will find themselves eclipsed in the long run by their more successful competitors.

3. Failing to analyze and understand current problems before developing remedies.

When firms are dissatisfied with an existing technology product, they often fail to undertake a rigorous analysis to fully understand the reasons behind their current problems before moving on. Absent this analysis, a firm is naive if it believes that new features available in a new product will solve its problems. For example, how can a firm know whether software is really unreliable or whether its problems really arise from problematic customization or inadequate user training and support? If one of the latter items is the root cause, then buying new software without addressing the other problem is unlikely to improve the situation overall -- and the firm will have wasted significant money and time in the process.

Firms must adopt the discipline of analyzing their current problems carefully and finding out what's really causing them if they hope to make the right decision about how to move forward and remedy them.

4. Adopting project plans with tunnel vision.

Technology projects are increasingly targeted at improving client service delivery and firm management. When developing project plans for these types of goals, the temptation is to focus on the work steps and resources needed to accomplish the better-known, and more tangible, technology tasks. Firms often fail to think through, and allocate time and resources to, the process, culture, and organizational changes necessary to make these types of projects a success; they are finding that, as a result, their implementations take longer, cost more, and cause higher levels of pain than they would like. Firms that have experienced these problems are working to develop new, more holistic approaches to project planning.

5. Under-using existing technology

Historically, firms spend money on tangible technology assets, like hardware, software, and connectivity, which provide the basic infrastructure.

But they resist spending on intangibles, such as training and software customization, that would help them achieve higher value. Firms have been even more hesitant to actively manage lawyers and staff and hold them accountable for effectively using the existing tools and systems.

Often it is simpler to blame the technology as being inadequate. As a result, most firms significantly under-use the technology they currently have in place.

In the coming year, with the expected emphasis on doing-more-with-less, firms should consider re-aligning their investments and their management efforts towards a goal of getting more out of the technology that they already have in place.

Sally R. Gonzalez is a consultant at Hildebrandt International, a management consulting firm for professional services organizations. She is a member of the LTN Editorial Advisory Board.