The document discusses how organizations can maximize business value from existing IT investments over time. It argues that businesses are slow to assimilate new technologies and do not fully exploit existing IT assets. The document recommends that executives prioritize extracting value from current IT systems through an ongoing process of learning and innovation, rather than taking a project-based approach to new technologies. This approach requires new organizational capabilities focused on knowledge management, social learning networks, and directed incrementalism.

1. DBS Virtual Class:
Maximizing Business Value from IT Investment
We argue that organizations
need to maximize the value of
their existing IT assets. It takes a
long time and a lot of learning.
In doing so, organizations need
new organizational capabilities
and social networks.
Oswaldo Lorenzo
@Lorenzooswaldo
©The Long Conversation: Maximizing Business Value from IT Investment – Lorenzo, Kawalek, Gonzalez, and Ramdani 1

2. DBS Virtual Class:
Maximizing Business Value from IT Investment
 We are living in exponential
times.
 New technology announcements
every day.
 This is exciting.
©The Long Conversation: Maximizing Business Value from IT Investment – Lorenzo, Kawalek, Gonzalez, and Ramdani 2

3. DBS Virtual Class:
Maximizing Business Value from IT Investment
Businesses assimilate
technology slowly.
How should one cope
with that?
©The Long Conversation: Maximizing Business Value from IT Investment – Lorenzo, Kawalek, Gonzalez, and Ramdani 3

4. DBS Virtual Class:
Maximizing Business Value from IT Investment
The case of Enterprise Systems  For the last 20 years, companies have
been implementing and adopting
large-scale IT, most notably enterprise
 A study of total costs of Enterprise systems (ES).
Applications ownership by the Aberdeen  They have done this in order to
automate transactions, reduce costs,
Group reveals that companies with increase customer satisfaction,
turnovers between $1–$5 billion pay an integrate with suppliers, and make
average of $5,920,785, and companies better decisions.
with turnovers between $50 and 100  Examples of ES include applications
million pay an average of $1,081,869 for a for:
• Enterprise Resource Planning (ERP),
complete ES package, which includes the • Customer Relationship Management
configuration and implementation of (CRM),
• Human Resource Management
software, after-sales service, and (HRM),
maintenance. • Product Lifecycle Management (PLM)
and,
• Supply Chain Management (SCM).
©The Long Conversation: Maximizing Business Value from IT Investment – Lorenzo, Kawalek, Gonzalez, and Ramdani 4

5. DBS Virtual Class:
Maximizing Business Value from IT Investment
Businesses are not able to exploit
the full potential of their existing
IT investment technology.
We jump to IT project by project like
some kind of hyperactive frog and
significant amount of IT value is left
Business on the table.
Productivity
As a consequence, IT is
underutilized.
This happens every day, even in our
individual interaction with
technology.
©The Long Conversation: Maximizing Business Value from IT Investment – Lorenzo, Kawalek, Gonzalez, and Ramdani 5

6. DBS Virtual Class:
Maximizing Business Value from IT Investment
The main priority of businesses today
is the value creation from the existing
(already implemented) technology.
Executives should milk the current IT
platform.
©The Long Conversation: Maximizing Business Value from IT Investment – Lorenzo, Kawalek, Gonzalez, and Ramdani 6

7. DBS Virtual Class:
Maximizing Business Value from IT Investment
 The application of the Long
Conversation model has an
important set of practical
implications for
organizations.
 We have summarized these
into three layers
1) The Business Value ladder,
2) The Long Conversation
process, and
3) The Organizational
capabilities.
©The Long Conversation: Maximizing Business Value from IT Investment – Lorenzo, Kawalek, Gonzalez, and Ramdani 7

8. DBS Virtual Class:
Maximizing Business Value from IT Investment
©The Long Conversation: Maximizing Business Value from IT Investment – Lorenzo, Kawalek, Gonzalez, and Ramdani 8

9. DBS Virtual Class:
Maximizing Business Value from IT Investment
While the average returns to IT
investment are solidly positive there is a
huge variation across organizations;
some have spent vast sums on IT with
little benefit, while others have spent
similar amounts with tremendous
success.
©The Long Conversation: Maximizing Business Value from IT Investment – Lorenzo, Kawalek, Gonzalez, and Ramdani 9

10. DBS Virtual Class:
Maximizing Business Value from IT Investment
 We see it as akin to a biological process.
©The Long Conversation: Maximizing Business Value from IT Investment – Lorenzo, Kawalek, Gonzalez, and Ramdani 10

11. DBS Virtual Class:
Maximizing Business Value from IT Investment
Ericsson: B2B Procurement
©The Long Conversation: Maximizing Business Value from IT Investment – Lorenzo, Kawalek, Gonzalez, and Ramdani 11

12. DBS Virtual Class:
Maximizing Business Value from IT Investment
Ericsson: B2B Procurement
©The Long Conversation: Maximizing Business Value from IT Investment – Lorenzo, Kawalek, Gonzalez, and Ramdani 12

13. DBS Virtual Class:
Maximizing Business Value from IT Investment
Managing the implementation
Project management vs. an emergent learning process
Managing knowledge and learning
Traditional training vs. social learning
CEO Role
Project support vs. Capabilities development support
Key Users Role
Implementing the system vs. Mastering the system
ES Team
Project team vs. Social network
©The Long Conversation: Maximizing Business Value from IT Investment – Lorenzo, Kawalek, Gonzalez, and Ramdani 13

14. DBS Virtual Class:
Maximizing Business Value from IT Investment
Directed incrementalism
Key to handle inherent uncertainty and
political context
Balancing direction with
incremental execution (action-
learning, and fast learning cycles).
©The Long Conversation: Maximizing Business Value from IT Investment – Lorenzo, Kawalek, Gonzalez, and Ramdani 14

15. DBS Virtual Class:
Maximizing Business Value from IT Investment
©The Long Conversation: Maximizing Business Value from IT Investment – Lorenzo, Kawalek, Gonzalez, and Ramdani 15

16. DBS Virtual Class:
Maximizing Business Value from IT Investment
©The Long Conversation: Maximizing Business Value from IT Investment – Lorenzo, Kawalek, Gonzalez, and Ramdani 16

17. DBS Virtual Class:
Maximizing Business Value from IT Investment
 IT journeys instead of IT projects.
 Longtime, long-life journeys, instead of short IT projects.
 This is our long conversation.
 When we talk of the Long Conversation, we are talking of the whole process of living with IT,
from its conception, past the point of accommodation and through into the ongoing processes
of learning and innovation.
©The Long Conversation: Maximizing Business Value from IT Investment – Lorenzo, Kawalek, Gonzalez, and Ramdani 17

18. DBS Virtual Class:
Maximizing Business Value from IT Investment
Thank you very much!
Oswaldo Lorenzo
@Lorenzooswaldo
©The Long Conversation: Maximizing Business Value from IT Investment – Lorenzo, Kawalek, Gonzalez, and Ramdani 18