"A cynic is a man who knows the price of everything, and the value of nothing." - Oscar Wilde

As I sit down to write today, I am thinking about an important idea I first learned about at SHARE. As my colleagues at SHARE prepare to gather in San Antonio from February 28 - March 4, I am remembering what I learned from them about thinking of IT as a value center instead of a cost center. While I am certain this way of thinking can be important to any enterprise, I am sure it has exceptional relevance in education. As we seek to engage students in learning, IT-enabled experiences offer great potential for value when used wisely.

In my work at SHARE, and with their zNextGen program, I had the opportunity to learn, and share, about the way we can achieve greater value from IT by understanding the difference between a cost-centered and value-centered approach to investing in information technology. Nearly twenty years ago, Professor N. Venkat Venkatraman, now at Boston University, wrote about the value center idea asking IT managers to think of IT in terms of its role as a cost center, service center, profit center, and investment center. In summary, the idea is to consider how IT is delivering value to an organization as we make decisions in how we invest in, cut the costs of, sell, deliver, or outsource IT functions.

This idea has remained relevant and evolved over the years and is one of the two key concepts Hunter Mueller describes as central to the “big shift” in his recent book, “The Big Shift in IT Leadership: How Great CIOs Leverage the Power of Technology for Strategic Business Growth in the Customer-Centric Economy”. It is also recognized as important to higher education and is one of the four tenets the University of Wisconsin is focusing on in its most recent IT strategic plan:

• Elevate the professionalism of IT Leadership and Staff
• Change IT from a Cost Center to a Value Center
• Substantially Increase Investment in Academic Technology
• Transform the UW System’s capacity to leverage academic and administrative technology-enabled services

In a 1997 article, Professor Venkatraman posed a number of questions about how IT can function as a value center that remain pertinent today. Among these, I have found the following questions especially relevant: How can we move beyond leveraging IT for redesigning current business processes to create new business capabilities? What truly distinguishes our ability to exploit IT functionality differently from our competitors? How can we continually achieve and sustain the required strategic alignment between business and IT operations? What are the driving principles for organizing IT resources in the twenty-first century?

I have been particularly interested in how we can make the best decisions about where we might invest in IT in ways that deliver great value in terms of the impact IT can have in supporting the mission of an organization. One of the concepts we discussed at SHARE was using the notion of value of investment (VOI) alongside that of return on investment (ROI). Especially in situations where it is difficult, or impossible, to measure a fiscal return on an IT investment, the notion of ROI can bias our decisions toward being too tactical and cause us to shy away from bold investments that might allow us to deliver great value.

Especially in higher education, looking for ways to measure the value our investments in things like Learning Management Systems in terms of their impact on student outcomes and success could allow us to better understand the true strategic value of these investments. The wise use of other IT tools, like analytics and data warehouses, can help us measure the impact of different tools, services, and methodologies to help us measure VOI.

In our personal lives, many of the investments my family and I have made have been more about value than return. While I don’t think of family life as I do about running an organization, many important aspects of our personal lives look more like value centers than cost centers to me. We do seek a return on investment as we save for retirement and the education of our children. We certainly manage many practical lines of our family budget, including groceries and transportation expenses, like cost centers. Still, there are many significant investment decisions driven more by the value we receive than the financial return we hope to achieve.

When we travel for pleasure, or purchase art, we don’t measure our results in dollars but in how these choices enrich our lives and relationships by allowing us to share joy and experience wonder with our loved ones. When we purchased our home we considered whether it was a good investment financially, but equally important was our desire to live in a place that brought us joy and satisfaction. As we support our sons’ education, we care about the ability it will give them to earn their livings, but even more about how it will enrich their lives by opening new horizons of knowledge and curiosity for them.

At the university, there are elements in our portfolio of IT services that should be managed as cost centers and service centers. For these we should look for the most cost effective approach, and that which allows us to deliver necessary services most effectively. There are also activities that are better managed as investment centers. For these activities, we need to focus our attention beyond cost and ROI on how wise strategic investments in information technology can deliver exceptional value in supporting the academic mission of the university. We need to answer the question "How can IT truly transform teaching and learning?"

In my career, I’ve spent most of my years working in an environment that treated IT as a cost-center. I’m proud that we were able to deliver an IT strategic plan for the university a number of years ago that began to move us away from strictly cost-centered thinking and toward a more value-centered approach. Our university will unveil its new strategic plan, the first developed under our new president, next month. Our new CIO will lead the process of developing an updated strategic plan for IT that is aligned with the mission, and strategic priorities, the university identifies in its plan. I’m excited by the idea that, through this process, we could become true partners with our academic colleagues in working to transform the lives of our students and the future they will shape.

By treating IT as a value center, and measuring the success of different aspects of our work in ways that allow us to better gauge their impact on our mission, I believe we will make wiser use of the true power of information technology.

I appreciate the learning opportunities I had at SHARE that inspired me to challenge conventional thinking and advance my own value as an IT leader. I’d encourage those of you working in enterprise IT to take advantage of these opportunities by participating at SHARE events in San Antonio next week, Atlanta this summer, or in the future. SHARE will come back to San Jose in the spring of 2017.