Zen of Septic Tank Repair
“The Way that can be told of is not an unvarying way;The names that can be named are not unvarying names.” Tao Te Ching, Lao Tzu
Tao, is everywhere, yet invisible.
The septic system had a problem. The old wooden risers providing access to the underground tanks had rotted away and collapsed. No problem, I thought, and phoned the experts. The quote was ridiculous, so I set out to do the job myself. Soon realized, that the cost is high for a reason. To install the new risers, I had to dig two 5’X3’X3’ (≈3.5 m³) holes very carefully, so no dirt could find its way into the tanks through the broken lids. The holes back-filled with the gases flowing from the leach field making the work unpleasant, to put it mildly.
When the job was complete, and the new risers were installed and covered with dirt, there was no visible sign of the Augean effort. For the next few years the septic system will work fine and when toilets are flushed, unwanted stuff will magically disappear and won’t reappear elsewhere. Much like IT systems, when they work seamlessly. The efforts to design, build, and run them are significant yet they are are almost unnoticeable if everything works as intended.
How about using IT – both the IT department and the Information Technology itself – in a more active and visible way? To utilize IT for more than just invisible piping that everybody wants to forget about.
Null hypothesis:
During a budget crisis, investments in Information Technologies shall be cut just like investments in other business or business support areas.
Following are three assumptions:
- The average enterprise spends about 5% of its revenue on IT.
- The IT organization divides the efforts between activities of Run, Grow and Transform. Let’s assume, that the investment ratio of our Enterprise is 70%-20%-10%.
- The appropriate application of Information Technologies results in an average 2% annual worker productivity increase for the whole enterprise. Let’s also assume that 100% of the Transform and 50% of the Grow result in institutional productivity increase.
Based on this, the ROI of IT investment in:
Transform: {(1-(5*0.1)}/(5*0.1)=1
Grow: {(1-(5*0.2)}/(5*0.2)=0
This means that the money spent on Grow type investments pays for itself and money spent on Transform type investments produces 100% profit. Another way of looking at the numbers is that the average IT organization makes up its number of FTEs in enterprise level productivity increase in 2.5 years. The payback period of IT people busy with Transformational or Grow type activities is less than 8 months!
How about the less mature Enterprise? The situation is even more promising because of the backlog of potential proven information technologies, best practices, and new paradigms to be implemented and opportunities of technology jumps (e.g skipping VOIP and move from wired to BYOD/wireless directly).
What are the implications?
- It is important to understand the various IT investment categories and their impact on enterprise productivity
- It is also important to plan and balance Run/Grow/Transform
- The IT department is not just a cost center and utility; IT can produce profit on investment
- Cutting the Transformational activities is similar to eating your seed corn
- Null hypothesis proven false
OK Lao Tzu, I shut up now…
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