How to communicate business value for maximum impact

How do you optimize a DevOps pipeline? You’ll need to get into the weeds. It’s not easy, but it’s doable. How do you streamline business operations? Even if you’re not a domain expert, somehow, you get in there and figure it out. These challenges that executives face are relatively easy to solve. Capturing organizational value is what’s hard.

There’s one question that always seems to stump executives and leaders—even myself, sometimes. The question is, what was the value provided by the team last quarter? This question causes leaders to think and reflect on what the heck they did in the prior quarter—and, more importantly, articulate the value that anybody would care about. So today, I’ll offer insights and approaches to solve this problem.

Hi, I’m Peter Nichol, Data Science CIO.

A leader I respect recently presented a simple concept in a meeting on this same subject that I thought was pretty funny. The leader started the discussion by firmly demanding, “Stop doing this! Stop cutting the lawn with scissors!” After that statement, a few slides of an individual cutting grass with scissors were flashed up on the screen. So often, we’re buried in the weeds and lose track of the bigger picture. By narrowing our focus, we lose sight of solutions that, over time, would solve our problem.

All too often, we’re buried in the details. We have daily fire drills in the hallways. We have last-minute executive decks to prepare. We have HR issues that seem to be never-ending. The result of this fast pace is that we get mired in the minutiae: we get fixated on things that don’t contribute to the bottom line. What does the bottom line mean to you? It might be focused on a triple bottom line—people, profit, and planet. On the other hand, it could be centered around driving the realization of operational goals. Maybe your bottom line is linking strategy to execution.

If I asked you to generate a two-year strategic vision, you’d collaborate with your team and come up with it. The challenge in harnessing value is it’s hard to make the concept of value realization sticky or real. Thinking about that value sometimes can be a stumper. So, what I’d like to do is provide a couple of different ideas to help you better articulate business value.

Allow me to share one example. The situation is this: You’re talking to two leaders in a conference room, and you’re separated from them by a glass wall. They’re unable to hear what you’re talking about. The great ideas you’re sharing, well, they didn’t understand any of that. This is what happens most of the time when leaders present the value their team achieved. Nobody appreciates the value because they’re not speaking in terms that other leaders understand.

Let’s empower you with some tools to make that transition a little bit more seamless. You have to keep the big picture in mind. There are three main buckets that I’d like you to think about when articulating and communicating business value:

  • The first is cost avoided.
  • The second is effort avoided.
  • The third is time avoided.

When you start to think about everything in terms of these three simple buckets, you can quantify, roll up, and articulate the business value in terms that leaders understand.

Let’s expand the concept by working through one basic example. The situation is that you’ve been assigned an initiative to streamline the executive signatures process. Today, these signatures for contracts or artifacts are signed on physical paper. Unfortunately, this results in many manual handoffs to ensure that the right leaders are in a position to sign the physical paper. In addition, logistics, geography, and work schedules make this process fraught with delays.

Over three months, your team is challenged to streamline the process and articulate the impact or business value. It sounds straightforward enough. Let’s get started!

To wrap up this initiative, you could speak with the team about process improvements or have individuals involved with the process explain their roles and contribution. This would give the team a broader understanding of the problem space, but there’s a more straightforward approach.

Let’s assume that 3,000 signatures were avoided as a result of this process improvement initiative. Great. That’s a good starting point. Now, let’s put some numbers around the time it takes to process each signature. This would involve an individual researching a contract, artifact, scope, etc. We’ll assume there’s thinking involved that these executives’ signatures aren’t rubber-stamped. We can estimate that it takes about 30 minutes to understand the contract and read it thoroughly.

Taking our 3,000 signatures times 30 minutes each results in a product of 90,000 minutes. If we divide the 90,000 by 60 to convert our minutes to hours, the resulting dividend is 1,500 hours. At this point, we want to determine the cost this reduction in approvals has achieved. We’ll assume an introductory blending rate of $100/hour to get a cost equivalent for executive time. Taking our 1,500 hours multiplied by $100/hour results in a product of $1.5MM. We did some excellent work. How do we frame this work for executive consumption?

We now have a clear understanding of the value realized:

  • $1.5MM cost avoided
  • 3,000 reduction in signatures
  • 1,500 hours avoided in non-value executive time

Our signature-modernization effect is one example of how to articulate business value. As you consider streamlining processes to discover business value, consider how you’re analyzing, articulating, and communicating business value. Keep it basic at first. Then, make sure you’re able to roll up your value proposition and present it in terms that executives understand. Finally, if you’re interested in additional methods to articulate and communicate business value, there are many great examples in my recent book titled, Leading with Value.

If you found this article helpful, that’s great! Check out my books, Think Lead Disrupt and Leading with Value. They were published in early in 2021 and are available on Amazon and at http://www.datsciencecio.com/shop for author-signed copies!

Hi, I’m Peter Nichol, Data Science CIO. Have a great day!

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Peter is a technology executive with 19 years of experience, dedicated to driving innovation, digital transformation, leadership, and data in business. He helps organizations connect strategy to execution to maximize company performance. He has been recognized for Digital Innovation by CIO 100, MIT Sloan, Computerworld, and the Project Management Institute. As Managing Director at OROCA Innovations, Peter leads the CXO advisory services practice, driving digital strategies. Peter was honored as an MIT Sloan CIO Leadership Award Finalist in 2015 and is a regular contributor to CIO.com on innovation. Peter has led businesses through complex changes, including the adoption of data-first approaches for portfolio management, lean six sigma for operational excellence, departmental transformations, process improvements, maximizing team performance, designing new IT operating models, digitizing platforms, leading large-scale mission-critical technology deployments, product management, agile methodologies, and building high-performance teams. As Chief Information Officer, Peter was responsible for Connecticut’s Health Insurance Exchange’s (HIX) industry-leading digital platform transforming consumerism and retail oriented services for the health insurance industry. Peter championed the Connecticut marketplace digital implementation with a transformational cloud-based SaaS platform and mobile application recognized as a 2014 PMI Project of the Year Award finalist, CIO 100, and awards for best digital services, API, and platform. He also received a lifetime achievement award for leadership and digital transformation, honored as a 2016 Computerworld Premier 100 IT Leader. Peter is the author of Learning Intelligence: Expand Thinking. Absorb Alternative. Unlock Possibilities (2017), which Marshall Goldsmith, author of the New York Times No. 1 bestseller Triggers, calls "a must-read for any leader wanting to compete in the innovation-powered landscape of today." Peter also authored The Power of Blockchain for Healthcare: How Blockchain Will Ignite The Future of Healthcare (2017), the first book to explore the vast opportunities for blockchain to transform the patient experience. Peter has a B.S. in C.I.S from Bentley University and an MBA from Quinnipiac University, where he graduated Summa Cum Laude. He earned his PMP® in 2001 and is a certified Six Sigma Master Black Belt, Masters in Business Relationship Management (MBRM) and Certified Scrum Master. As a Commercial Rated Aviation Pilot and Master Scuba Diver, Peter understands first hand, how to anticipate change and lead boldly.