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Showing the digital return on technology investments

5 min read

Written by: , Nick Potts

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What are ‘digital returns’?

C-suite expects investments in digital technology to accelerate growth beyond what we have already seen. Enterprises have implemented advanced digital technologies to create smart products or services, optimized interactions across multiple channels, and made business capabilities hyper-efficient. Digital returns are the positive impact these intangible investments in software have on the top and bottom lines.

Expect the pressure to increase for CIOs

Data shows for the past four consecutive years, CEOs have invested in digital capabilities and there is little to suggest that this trend will change in 2023. Additionally, with economic and market forces predicted to become more challenging in the near term demonstrating the business value of IT will be a high priority. 

Fig 1.0 – CEOs are doubling down on digital, Gartner

Unfortunately, CIOs and tech executives find it a significant challenge to provide top and bottom-line benefits from technology investments. To get this information you should follow these three critical steps to understand the financial and operational impact of the organization’s technology investments.

  1. Understand your current state
  2. Determine your future state
  3. Measure and monitor progress against your roadmap

Know where you are

When you have complete transparency into your application landscape across the entire enterprise, only then can you realize the reality. CIOs need data-driven insights derived from their software to put them in a stronger position when it comes to making critical IT decisions. 

Documentation can capture a lot of information, the challenge is keeping it up-to-date and trusting it is accurate. Additionally, internal domain knowledge can leave the building and be subject to bias. Objective measurement of how future-fit your software is reveals all the risks and opportunities that reside within your software portfolio. 

Quantifying your technical and architectural debt, validating your security risks and compliance, and appraising your open-source risks give IT a high degree of clarity. Additionally, it may highlight areas that have been overlooked which could slow down your ability to support the business. All this information will ‘draw a line in the sand’ whereby you can match your technology investments against the delivered value – a necessary first step in showing digital returns. 

Organizations rely upon their technology to achieve their business objectives and leadership needs to trust the decisions they make are based on the factual status of their software portfolio. Measure your application landscape to give you the data-driven insights to validate your roadmap with a Sigrid | Landscape Scan

Know where you want to go to

With the continued digitalization of business, the CIOs role is becoming more integral, they need to shift their mindset (and the organization’s view of IT) to thinking of software as an enabler for business. 

“The role of an IT leader is not to provide technology but to enable the delivery of business value and benefits through technology. So the challenge is for the CIO to understand what the business needs when it says, ‘You need to deliver value.’” says Info-Tech Research Group principal research director Ross Armstrong (4 Steps for proving IT’s value to the business

In this new digital era, there is a lot of pressure on IT to be agile and capable of responding to ever-changing IT and business demands. This reinforces the need for CIOs to be able to demonstrate the digital returns and validate the positive impact IT is having on business outcomes.

Know how to get there

With complete visibility into your entire application landscape coupled with your roadmap, designed to support the organization to do better business, tech leadership needs to track the speed of progress. Continuous measurement of your software portfolio gives all stakeholders (C-suite, Enterprise Architects, Product Managers, Engineering) the facts they need to validate that IT is actively delivering value.

The challenge is if you are being slowed down by maintenance that is delaying you from providing value sooner. This is where all stakeholders across the organization need to be aligned so that either the business case can be built to reduce technical debt that will free up your team to work on digital transformation that has a positive digital return. Of course, not all technical debt is equal, again with data-driven insights tech executives can take an ROI-focused approach to maintenance and boost innovation.

Leadership must prove IT’s value 

Business in the digital age is impossible without a strong technology foundation. CIOs have a unique opportunity to become business drivers. They still need to ensure stability, effectively reduce maintenance costs, manage risks, improve agility, and meet business requirements. But, this is not sufficient if you want to step into the position of a trusted business ally.

In a recent article, Senior Partner at McKinsey, Aamer Baig, highlighted, “the clear implication is that CIOs need to make the leap from tech leader to business driver, and the actions they take in the next 12 months will largely determine whether their business can meet its aspirations.”

CEOs are expecting to see digital returns from technology investments, when CIOs have a way to measure and monitor their software portfolio they are in the strongest position to show the impact they are having on business value. This will help CIOs elevate ITs role within the organization and put technology at the forefront of the business.


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Nick Potts

Growth Marketing Manager

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