IT Strategy and the Importance of Complexity Reduction

Reducing complexity is a key component of an effective IT strategy. Analysis by The Hackett Group^® finds that IT complexity has a measurably negative impact on IT efficiency and costs per end-user. Needless complexity is also the single most important factor impeding IT function capability development, including the ability to align with and provide value to the business as a whole. Consequently, while there are other dimensions to a winning IT strategy, driving out complexity wherever possible should be regarded as a core strategic objective.

In making complexity reduction a key component of its IT strategy, an organization must distinguish between different types of complexity. In particular, when developing an IT strategy distinctions should be drawn between inherent business complexity that is largely beyond the influence of the IT department (such as the business’s geographic dispersion, number of product lines, regulatory environment, and so on) versus controllable complexity that is a function of decisions made by the IT organization. Within the realm of controllable complexity, IT strategy framers must further distinguish between value-added complexity that is carefully justified by enabling some otherwise unattainable benefit, versus non-value-added complexity that does not contribute to IT effectiveness. Driving out the latter, and its specific manifestations in technology complexity, sourcing complexity, and service delivery model complexity, should be central to any organization’s IT strategy.

The Hackett Group can help you develop and implement a winning it strategy

As a leading global strategy and operations improvement consulting firm with deep experience and expertise in benchmarking, best practices implementation, and process improvement, The Hackett Group is the ideal partner to help you formulate and implement an IT strategy that will drive measurable improvements to the IT function’s efficiency and effectiveness. The Hackett Group can show you how to drive needless complexity out of the IT function, as well as supporting you in other dimensions of IT strategy including relationship management, portfolio management, and talent management. Leveraging our unmatched benchmarking expertise, The Hackett Group can help with the selection and application of IT metrics to baseline current performance and measure progress. We also offer expertise in particular technology deployments such as SAP implementation and Oracle implementation.

Our consulting and advisory services are grounded in the knowledge and experience that we have gained from years of hands-on work with the world’s leading businesses, including 97% of the Dow Jones Industrials, 89% of the Fortune 100, 70% of the DAX 40 and 55% of the FTSE 100. The Hackett Group delivers fact-based consulting that drives measurable improvements to our clients’ operational efficiency and effectiveness.

To learn more about our IT strategy consulting and advisory services, as well as our support for operational initiatives such as business process reengineering, deployment of global business services centers and more, contact us.