This article makes the interesting point that if you're doing Total Cost of Ownership (TCO) summaries for your capital projects then you're being seen as a cost center ... and costs are meant to be cut. Now, if you're seen as a contributor to your organization's profitability then you should be preparing Return on Investment (ROI), Internal Rate of Return (IRR), or Economic Value Added (EVA) analyses of projects. These methods show the contribution of IT to the bottom line.
At some point I'll start developing the idea of options pricing as it relates to IT projects, which is an even more interesting way to demonstrate value.
Friday, September 19, 2008
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