Technological Business Management (TBM) is a rising category of software solution aimed at assisting IT staff to manage the costs, value and quality of IT services. It brings together best principles of performance and financial into the complex Information Technology Environment. TBM is based on some core principles, which ensure delivery of IT products and services. Below are the core principles.
Cost transparency is the first TBM principles. This principle holds that the IT staff must transparency into the cost of producing and delivering all IT services or products. This principle requires that the IT staff defines and identifies all the cost drivers and unit costs so that they can be able to reduce costs of the delivery without compromising on the quality (Kangas 72).
Managing performance by making trade-off is the other principle. The IT staff must ensure that they combine Total Cost of Ownership of IT services and products with quality of service information. This is useful in increasing the returns on company’s assets while reducing the costs of production. This is also helpful in making trade-offs depending on the priorities of the organization. This principle also ensures efficiency in delivery of it products. Moreover, is assists IT staff in identifying opportunities to focus on.
Continuous planning and improvement is the last principle of TBM. This principle requires that IT staff engage in continuous identification of opportunities that will improve the operations of IT department. They must be able to forecast, plan and manage the IT budget. The IT staff are required to strive to improve the IT department to ensure quality services and products.
Technology Business Management is very crucial in the business environment today. IT staff management have a lot to do than just manage technology. The staffs have to plan, forecast, and manage the IT budget. In addition, they have to be flexible enough to be able to adjust the budget as per the performance of the organization (Andrione 112).
The other reason why Technology Business Management is that the IT department must be run in accordance with the business environment today. Organizations today are operating in environments are increased competition, cost cutting, and changing to shared service models. TBM is useful in assisting the IT department to continue operating in profitably in the above business environments.
The IT department is shifting to an economically independent department in many organizations today. Initially, IT cost framework was greatly rigid. Organizations also ran their operated their own IT departments. For this reason, cost management and allocation was an easy task, and the expenditure was relatively small. Today, IT economic environment is very different; it is more centralized with a separate cost structure and expected high returns on capital. The costs of the department, therefore, need to be managed and planned carefully. When this happens, TBM becomes very useful in helping IT staff mange the IT department as a separate Variable Cost Unit (Probert 75).
To be able to meet the above demands, every organization requires a comprehensive TBM solution. TBM will be very helpful in transforming the IT department into a well-managed department. It assist the IT management to gain visibility into the costs and performance of the IT department, this helps in developing cost cutting measures while at the same time retaining quality of the IT products and services. It also assists the IT management make efficient Return on Investment decisions and ensures that the IT department is a profitable department and not just a costs consumer. Through Technology Business Management, organizations will be able to completely transform the IT department and manage it more effectively and efficiently. The IT department will transform from a support department into a core profit-generating department.