Technology Business Management (TBM) is a decision-making tool that helps organizations maximize the business value of information technology (IT) spending by adjusting management practices. With TBM, IT is transformed to run like a business instead of merely a cost center. Decisions are made based on overall business needs like reliability and customer satisfaction.
Meeting customer needs is vital, and a huge part of that is system reliability, which IT is responsible for. If customers can’t access our systems, we make them unhappy and may lose them altogether, therefore reliable systems are a business requirement if we are to serve customers well. When we choose to include in our plans and budgets fixing known issues, properly maintaining our systems promptly, and making time to proactively seek out and find solutions to problems we didn’t know existed, customer service improves and remains solid.
TBM creates visibility into the actual costs, quality, and value of technology services for the business. Using facts and metrics to look at technology from a business perspective helps rein in unnecessary spending. It also frees up funds for more important things like long-ignored technical debt and maintenance as well as greater innovation on features that will delight customers.
The overall goals of TBM are to communicate the value of IT spending to business leaders and then collaboratively reduce costs while preventing the sacrifice of vital aspects of the service IT provides. The powerful results are that IT will be better aligned with organizational business priorities and also that business leaders will better understand the value IT provides to the organization. Proper IT investments can then be made rather than focusing only on IT cost.
Technology Business Management (TBM) is a collaborative framework created by the Technology Business Management Council (TBM Council). TBM is similar to IT Service Management (ITSM), in that both are descriptive rather than prescriptive.
The TBM Council has more than 10,000 members and approximately 45% of them are C-level executives like CEOs, CTOs, CIOs, CFOs, and so on. This organization curates and shares standards, best practices, and education opportunities for its members, many of whom are technology leaders.
The TBM Council created a TBM taxonomy that provides a defined common language to help guide discussions that align leaders in finance, business, and IT units. They provide educational resources and conferences, too.
The taxonomy is an important foundational tool because it provides a clearer understanding of, and communication across, the three main stakeholders involved in TBM when discussing IT. It gives the:
- Finance View: Finance leaders provide cost categories and numbers, such as hardware, software, maintenance, and labor. Cost transparency is vital for TBM to be useful.
- IT View: IT leaders provide insight into physical and virtual technology resources, such as servers, storage, and applications. Understanding what technology leaders require to please customers is vital for TBM to be useful.
- Business View: Business leaders and sometimes business partners provide a standard set of application and service categories along with higher-layer business units and business capabilities. Knowing how IT provides value to the organization and customers from a business perspective is vital for TBM to be useful.
These three viewpoints, when combined, can effectively comprehend and communicate which IT services are necessary for financial management designed to optimize the organization to meet business goals.
Having these value conversations will help shape the demand for IT services and resources by aligning IT with business needs and strategy, thereby helping the business increase revenue. It will also help IT procure all its technology needs to function effectively in meeting business needs.
For JPMorgan Chase, cited in a case study by the TBM Council, it was when other business units were shown their total IT costs for the first time that they realized “that the cost to deliver IT’s services and the prices they were paying for those services were two different things.” Transparency into IT spend shifted the dialogue from tech metrics to application and infrastructure services. This more clearly links IT decisions to the ability to meet business needs, marrying supply with demand. Communication across units creates understanding which leads to better corporate decisions.
The next step in the creation of a TBM program involves accepting and adopting a set of ten core tenets and then figuring out how to implement them into your organization. The council provides a book to learn the discipline and various online and in-person forums for sharing ideas and positive examples of implementations from organizations outside your own.
The ten core tenets of TBM are:
- Position your business for value: define your value proposition. What value do you bring to customers, other businesses, and end-users? This should inform your business goals.
- Continuous improvement: integration into day-to-day processes is key for TBM to be successful.
- Create a culture of transparency: use spending, consumption, and capacity data to draw meaningful insights about the business.
- Create consumption behavior patterns: use insights across the company to influence spending and consumption behavior.
- Deliver on value: deploy cost-effective methods to create value.
- Planning and governance: have a strategic business plan that aligns budget and values.
- Know the cost: to perform at peak levels, and how to keep costs low with best practices
- Optimize portfolios: to ensure they deliver on value most efficiently.
- Invest in innovation: requiring innovation to bring costs down while remaining competitive.
- Create an agile enterprise: quickly responding to internal or external threats as well as changes in the overall market.
These tenets create a foundation. You provide the implementation. It is similar to needing to create something like the prescriptive ITIL practices from Apptio when an organization wanted to apply ITSM. Interestingly, Apptio has taken over the TBM Index, which was originally created by the TBM Council and McKinsey & Co as a standardized benchmark assessment of corporate environments and what TBM elements would help make the biggest impact. Apptio has replaced it with a paid certification program and the Apptio TBM Unified Model (ATUM) which they have implemented in their software.
Implementation and TBM maturity can take years, especially if your organization has operated in silos with poor communication between IT and other groups like finance and leadership, and especially if you are in the middle of a digital transformation for an older company with a classically run IT department. Typically, organizations begin by holding meetings between leaders in business, finance, and IT to discuss the taxonomy so that everyone can communicate in a way everyone else understands.
It is common for organizations to create an organizational playbook to define values, intentions, and viewpoints. The playbook includes a roadmap, which is a practical plan for discovering and learning how things work today, from all standpoints including the technological.
Using the TBM framework is sometimes requested by the board of directors of the organization to help them feel comfortable with their role of oversight. It is also becoming common in non-profit organizations and federal government agencies like the General Services Administration (GSA), which adopted it in late 2016. As a result, many federal agencies must ensure that the plans they are making comply with specific governmental standards, like those from the GAO, OMB, or OIG in the United States.
Once the group shares a common foundational understanding of the financial and business and IT infrastructure realities, they come up with a plan for implementing TMP across the organization. This is when changes are finally adopted and rolled out.
In IT we love to talk about tech metrics like uptime, latency, and customer support tickets. Customers don’t care about these. They care about whether or not you can meet their needs at the moment they present those needs.
Understanding and prioritizing customer needs is the key driver behind business and IT decisions. Our organization should focus its efforts on making sure that any services provided by IT are consistently available and reliable. To do this, we use Chaos Engineering to find, diagnose, and address problems in our systems and services before they can affect customers.
In this section, we’ll present several ways that Chaos Engineering helps support TBM.
When IT focuses its decision-making efforts towards customer satisfaction, our organization can focus its financial and business perspectives towards better supporting and enabling IT. This aligns the entire organization towards customer satisfaction and recognizes IT as an enabler of that goal. Our revenue depends on customer satisfaction—especially for customer retention—and the primary means of accomplishing this is by providing services that are reliable, performant, and quickly recoverable in case of problems.
Chaos Engineering helps us meet these goals by:
- Testing for common failure modes in our technology stack.
- Preparing for peak traffic events like Black Friday and Cyber Monday.
- Ensuring reliability when modernizing or migrating systems.
All of these serve the underlying purpose of providing a great customer experience, and in turn, supporting revenue generation.
Chaos Engineering tools like Gremlin help IT staff understand the various ways that systems can fail, and how a failure in one system can impact the reliability of other systems. By running chaos experiments on our systems, we can find weaknesses early and train our staff in where to focus reliability, disaster recovery, and customer satisfaction efforts.
When performed as an ongoing practice, Chaos Engineering helps ensure systems remain reliable over time. Events like GameDays can expose new and unexpected failure modes in running systems, while FireDrills help our teams practice and fine-tune their incident response procedures. These can be run remotely now that many IT staff are not working in-office. Taking these proactive measures not only helps us build resilient systems, but ensures that our staff is prepared to resolve incidents as soon as they happen.
The goal of TBM is to create an IT operating model that clearly connects costs to resources. Cloud resources can make up a significant portion of these costs, so this model must account for the cost of cloud applications and surrounding innovative technologies. Optimizing cloud costs was the top tech priority for enterprises in 2019.
Many enterprises use Chaos Engineering to implement cost-saving strategies, which relates directly to TBM goals by creating discipline around cost allocations and thoughtful portfolio management for cloud resources. These strategies include:
- Finding unused or unneeded resources.
- Reducing pre-allocated compute capacity.
- Creating and validating auto-scaling rules.
These practices help streamline IT deployments and save money, without preventing IT from meeting their operational goals. TBM provides the incentive, and Chaos Engineering helps achieve it quickly and reliably.
Chaos Engineering is how we create and maintain reliable IT infrastructure. It’s also how we turn failure-prone systems into resilient systems. The practice is transforming and updating industry reliability practices.
While TBM helps the organization align all stakeholders towards a common goal, Chaos Engineering helps IT test, adjust, and tune IT infrastructure and applications to serve that common goal. This includes activities such as:
- Ensuring business continuity by creating a proactive maintenance plan that includes redundancy, failover, and thorough system monitoring.
- Tuning your alerts to detect unhealthy conditions.
- Adapting software testing for modern architectures.
- Adopting Chaos Engineering practices and performing periodic GameDays and FireDrills.
These all come with time, labor, and resource costs that TBM must account for, but the benefit is a significantly lower risk of expensive outages and lost revenue.
In the end, the goal of TBM is to align IT with business and finance to save money while continuing to serve customers. Some of these savings will come from realigning each team’s perspective. Some will come from adjusting IT resources and how we use them. With Chaos Engineering, we can find additional savings by focusing efforts on enhancing system reliability instead of recovering from preventable disasters. Using Chaos Engineering as part of a greater TBM initiative allows us to do this effectively.