Unlike a product that’s never been seen before or a cutting edge marketing strategy, managing information more effectively is guaranteed to improve how a business operates. After all, organizations only do four things: manage financial assets, manage physical assets, manage human assets and manage information assets. Generating improvements to any of these things will have a significant, tangible impact on an organization.
The challenge, then, is in determining the exact nature of the impact information management will have and articulating its benefits in terms that make sense to executive leadership and will compel them to act, i.e., provide funding and support.
Doing this successfully is most often a matter of thinking a little differently, of trying -- despite the fact that you’re an information management practitioner, IT professional, records manager, etc.-- to think like a business person thinks.
Editor's Note: Read Joe's last post, which introduced why Nobody Really Cares About Information Management
The best way to articulate the value of information management in terms a business leader would respond to is to adopt a relentless skepticism, to keep asking “so what?” until you reach a compelling answer.
For example, a typical (and wildly unsuccessful) information management business case might go something like:
Our survey showed that on average, employees spend 25 percent of their time searching for documents. The median fully loaded employee costs $100,000 a year, and we have 10,000 FTEs. We estimate that improved information management practices could cut the time employees spend searching in half, which would lead to a savings of $125M a year in efficiency gains across all employees.
When this justification fails to get executives to support an information management program that costs less than $10M to fund over three years, folks scratch their heads -- who would be crazy enough to turn their back on $125M annual savings that require so little spend to realize? Let’s dig into this a little.
Show Me the Money
The first so what question any executive with a checkbook will ask is "how certain am I of getting a check in return for the money I’m going to spend?" If we think about the business case example above, the answer is not certain at all. In fact, the way these efficiency gains are articulated, there is no check coming no matter how much you spend on information management. All the executive gets in return for funding information management is a workforce that spends less time searching for documents, but what they do with that 12.5 percent of time we’ve given back to them is unclear. They may spend it taking lunch away from their desks, looking at Facebook or leaving earlier to be with their family -- none of which gives that executive any hard dollar returns.
Step one in improving this business case is to spend time thinking about how to quantify what happens when we give workers 12.5 percent of their time back. One of the best things that can happen (from the executive’s perspective, of course), is to reduce head count, because this is a direct and tangible impact to operating expenses. A close second is reallocation, i.e., moving resources from one area to another, which either saves the organization from having to spend money on new hires or shifts resources to higher value work (or both).
Unfortunately, in the case of our efficiency example above, neither one of these is going to be a likely outcome of giving folks 12.5 percent of their time back, so we need to look further.
After reducing/reallocating headcount, your next best option is to find examples of specific business processes that are being negatively impacted by the time employees spend looking for the information they need. Although these will differ quite a bit depending on organization and industry, here are a few examples that could be relevant across lots of different companies:
- Accounts receivable -- collecting money owed to an organization takes longer when key documents (invoices, contracts, MSAs) are hard to find/can’t be found -- better information management leads to a reduction in receivables aged over 45 days.
- Sales -- cross-selling new products to existing customers is more difficult when key customer information (account correspondence, marketing solicitations) is hard to find/can’t be found -- better information management leads to a percentage increase in cross-sell dollars.
- Customer service -- first call resolution rates lower and call time higher when key documents (account correspondence, standard operating procedures, product information, policies) are hard to find/can’t be found -- better information management leads to reduction in overall call volume and average call time.
Notice how much more effectively each of these answer the so what of our executive with the checkbook. In each of them, we've replaced a vague 12.5 percent efficiency across all employees with improvements to specific business processes.
What’s missing in these examples is the amount of the improvement -- that’s because we don’t have a real organization to work with right now. But in your own organization, for these kinds of business case justifications, you would need to determine, for example, what the rate of receivables aged over 45 days was and then gain agreement from your accounts receivable team as to the reduction they felt comfortable with based on better information management -- the same would go for the sales and customer service examples.
The Final Word
Although we've only scratched the surface of making your information management business case more effective, hopefully you can see already how much improved it is over the initial save everyone 12.5 percent of their time justification. In upcoming posts, we’ll continue to look into this topic, because once you've got your information management justification articulated, now you have to worry about the competition, i.e., all the other folks out there with hat in hand looking for funding alongside you. In the end, these are the folks you need not only to worry about, but understand so that you can give your ask the best chance of getting a yes.
In the mean time, I’d love to hear from you all out there about your experiences creating information management business cases, getting funding (or not), or what you think about the approach I've outlined here -- jump in, and let’s get the conversation started.
Title image by Andrey_Popov (Shutterstock)
Editor's Note: Read what Joe thinks about records management in Organizations Need to Rethink Approach to Records Management