Lack of an IT process costs the average Fortune 500 company the equivalent of $261,000,000 a year. No wonder more than half of all CEOs question the value of their IT organizations.

As a management consultant helping my clients attain competitive advantage from their IT investments, there's one phrase I hear all the time. It goes something like this: "We don't need a process; we're IT pros; we know what to do.

"When I hear this attitude, I know I am working with an individual or a company statistically more likely to fail than to succeed. Don't misunderstand me - technology obviously has its place, but using technology correctly is simply more important.

In this article I am going to show how the lack of an IT process is perhaps the single greatest impediment to business success of all time. Then, I am also going to show you what you can do about it, because your IT investments can still deliver a competitive advantage if managed correctly.

The issue at hand is that many IT managers have reversed the IT-cart with the process-horse (putting IT before the process). If you are one of these IT managers, perhaps you will come to understand why you are most likely always at odds with customers and management who you feel "you just don't get it." If you are a customer or non-IT executive it may give you the motivation to make the changes needed to solve the real problem.

To begin, I recently came across the following statistics from 30 companies where senior leaders chose to improve process instead of chase technology. These organizations realized an average of:

1. •34% cost reduction
   

2. •50% improvement in schedule
   

3. •61% productivity increase
   

4. •48% improvement in quality
   

5. •14% increase in customer satisfaction
   

6. •4:1 Return on Investment
   

Then, there was another announcement about companies that focused on developing sound management skills (read process). These organizations generated:

1. •EBITDA of 16.2 percent versus 14.1 percent for typical companies (which would net a typical Fortune 500 company an additional $399 million annually)
   

2. •$247 million annually via a 22% improvement in net profit margin
   

3. •$992 million annually via a 49% improvement in return on assets
   

4. •$340 million annually via a 27% improvement in return on equity
   

Show me a technology - any hardware or software from any vendor - that consistently delivers results like these, please! When it comes to developing software applications, it's not the language [tool] you use, but how you use the language [tool] that really counts. IT people use tools in their jobs to build IT systems. Employees use IT systems as tools to carry-out business functions. How people use tools is the very definition of process. Use a tool the right way, and the benefits can be amazing. Use the same tool incorrectly, and the results can be devastating. What's the difference? Process, of course. Read the article...