How CIOs Can Build IT Departments That Are Money Makers

by drjim on November 13, 2013

CIOs need to find ways to turn IT departments from cost centers into money makers

CIOs need to find ways to turn IT departments from cost centers into money makers
Image Credit

CIOs have since the beginning of time struggled to get the respect that the other C-level executives get. One of the big reasons that it can be so hard to get the IT department to be viewed by the rest of the company as being valuable is because all too often, despite the importance of information technology, the IT department is considered to be a cost center. What if a CIO could change this. What if the IT department could be transformed into a money maker – then finally the CIO would get the respect that he or she deserves. Now just exactly how to go about doing this…

Just Exactly What Does A Money Making IT Department Look Like?

Before you can have any hope of transforming your cost center IT department into a money maker, you first have to be able to picture just exactly what a money making IT department would look like. It turns out that you probably already have a good understanding of this because of all of the IT vendors that you already interact with.

Other leaders in the CIO job have been able to successfully transform their IT departments by looking at what they do well and then, just like IT vendors do, turning it into a source of revenue. There is no one correct answer to this question – you’re going to have to take a close look at your IT department and decide what is going to work best for you and your company.

Money making techniques that have worked well for other IT departments include finding ways to help other parts of the company boost the amount of successful selling that occurs in the company’s showrooms. An easy way to make this happen is to take a piece of software that the IT department has created and then package it to be sold to other firms. Finally, in the era of big data in which we are living in, most IT departments have access to a great deal of valuable data. It can be straightforward for an IT department to take this data and transform it into a service that is then sold to other firms.

What Is The Process For Transforming An IT Department Into A Money Maker?

Identifying how you are going to transform you IT department into a money maker is a great first step. However, once you’ve done that, you are now looking at an even bigger question: what is the process for getting from where you are to where you want to be?

It turns out that the entire process starts with you in the CIO position taking the time to listen to what your IT department is trying to tell you. How you are going to transform your IT department is not a mystery, your workers already know how this needs to be done. You just have to be willing to listen to them.

A great way to start the process is to create an “innovation council” within the IT department. Don’t permanently assign people to this council – rather, rotate people through it. If you tap into the power of social media tools, then you can provide the rest of the company with a way to submit ideas to the council. It will then be up to you to create a process for evaluating ideas and determining which ones you’ll be moving forward with.

Once that’s been taken care of, you can move on with the rest of the IT department’s transformational process. This includes getting the rest of the business to view the IT department as being a creditable business partner. Once that’s been accomplished, it’s time to deepen the relationship and become a business partner who is both influential and transformational. In the final stage of the transformation process you want the rest of the company to regard its IT department as being a strategic business peer.

What Does All Of This Mean For You?

In order for a CIO to get a seat at the table where the future of the company is being debated, they are going to have to win the respect of the rest of the company’s executives. In order to do this, the IT department is going to have to be transformed from being a cost center to being a money maker.

In order to accomplish this transformation, CIOs are going to have to identify how the IT department can generate cash. It can be by creating and selling either software or services, or perhaps using the department’s IT skills to solve other company’s or department’s problems.

No matter how it’s done, once the IT department has transformed itself into a money maker, the CIO is going to have to spread the word to the rest of the company. Suddenly the IT department will be making a direct contribution to the company’s bottom line. This should be good enough to finally get the CIO the seat at the table that you have wanted for so long.

– Dr. Jim Anderson
Blue Elephant Consulting –
Your Source For Real World IT Department Leadership Skills™

Question For You: Who is the best person in the company to talk to in order to find out how the IT department can start to generate money?

Click here to get automatic updates when The Accidental Successful CIO Blog is updated.

P.S.: Free subscriptions to The Accidental Successful CIO Newsletter are now available. Learn what you need to know to do the job. Subscribe now: Click Here!

What We’ll Be Talking About Next Time

As a CIO, your job is to make sure that the company’s IT systems are up and running at all times, right? You really don’t play a role in what the company does to make money – after all, you’re in charge of a cost center. Well, that’s the way that things might have been back in the day; however, now that we’re living in the era of Big Data, that has all changed. Now CIOs are more and more often playing a role when it comes to determining what price the company is going to charge for its products…

Be Sociable, Share!

{ 0 comments… add one now }

Leave a Comment

Previous post:

Next post: