Commercialising Internal IT - Evangelize Consulting

Taking software, systems, and capabilities built for internal use and selling them externally to clients requires significant effort across people, processes, and technology. Below, we dive deep into critical considerations and best practises to enable successful commercialisation. One essential step is thoroughly evaluating and tailoring the software or system for external use. This may involve enhancing its functionality, improving its user interface, and ensuring compatibility with different operating systems or platforms. Additionally, organisations must establish robust customer support, training, and maintenance processes to meet external clients’ expectations and requirements. Technologically, scalability and security become paramount when commercialising software or systems, as they need to handle increased user loads and protect sensitive client data. By addressing these considerations and implementing best practises, organisations can effectively transition their internal tools into successful commercial products.

Standardising Internal IT Systems and Processes

Before attempting to sell solutions externally, internal IT systems and processes require thorough standardisation. This includes:

Standardising architectures: Internal apps are often built on a disjointed fabric of outdated legacy systems. Rationalising enterprise architecture makes external implementation more seamless. Adopt modular designs, open APIs, and cloud-native platforms.
Unifying data structures: External clients want integrated solutions, yet internal systems frequently have disjointed data models and repositories. Clean up data schemas and implement master data management.
Building configurable solutions: Hardcoded custom apps won’t work for external users. Re-engineer with maximum configurability and dynamic parameterisation.
Developing reusable components: Build libraries of parts that can be assembled for different use cases. APIs, workflows, algorithms, and more should be designed for reuse.
Documenting institutional knowledge: Capture tribal knowledge so solutions aren’t dependent on specific internal resources. Document key processes, dependencies, guidelines, etc.
Implementing DevOps: Mature internal development practices with automation, continuous testing, and production-first mindsets. This provides the reliability and control needed for external delivery.
Certifying security and compliance: Get solutions audited against external standards so clients are assured of security and data protection.

The more productised and industrialised internal systems become, the easier it is to replicate them externally. This replication enables organisations to offer clients their internal systems as services, providing them a competitive edge in the market. Additionally, by streamlining and standardising internal processes, organisations can optimise efficiency and reduce costs when implementing these systems externally. Ultimately, the goal is seamlessly transitioning from internal systems to external delivery, ensuring a consistent and reliable client experience.

Building a Project Management Office

A dedicated Project Management Office (PMO) provides the rigour to deliver projects successfully for external clients. The PMO should establish project management methodologies and best practises, ensure clear communication and collaboration among project teams, and track and report on project progress and performance. By doing so, the PMO guarantees the successful delivery of projects for external clients and enables the organisation to improve its project management processes and drive efficiency continuously. Additionally, the PMO plays a crucial role in supporting and guiding project managers, ensuring they have the resources and tools to manage projects and effectively meet client expectations.

Define standardised project processes: Document playbooks for accurately scoping, planning, and executing projects tailored to external clients.
Estimate projects reliably: Build accurate models for estimating effort, costs, and timing across use cases. Avoid surprises down the line.
Requirements management: Follow structured systems engineering processes for capturing and validating requirements early. Manage changes through strict change control processes.
Risk management: Identify risks proactively and develop mitigation and contingency plans. Maintain a risk registry.
Vendor governance: Manage relationships with third-party providers. Negotiate contracts, enforce SLAs, and ensure delivery quality.
Quality assurance: Establish gates, checklists, and audits to inspect work. Define “done” clearly. Fix defects early.
Master Scheduling: Plan integrated project schedules and critical paths. Manage interdependencies across clients.
Reporting and monitoring: Provide timely, visual reports on scope, budget, timeline, and issues for stakeholders.

The PMO provides the rigour and oversight to deliver maximum value for clients. By overseeing contract negotiations, enforcing service-level agreements, and ensuring the delivery of high-quality work, the PMO plays a crucial role in maintaining client satisfaction. Additionally, implementing quality assurance measures, such as establishing gates and checklists and conducting audits, ensures that work meets the required standards. The PMO’s involvement in master scheduling allows for efficient project planning and management of interdependencies across various clients, ultimately optimising resource allocation. Furthermore, providing timely and visual reports on project scope, budget, timeline, and issues enables stakeholders to make informed decisions and stay updated on the project’s progress. With its rigorous oversight and attention to detail, the PMO is dedicated to delivering maximum value to clients.

Developing Business Relationship Management

A dedicated business relationship management (BRM) function is the ongoing liaison between the IT group and external clients. BRM focuses on:

Client onboarding: Setting expectations, establishing governance, and securing initial buy-in during the transition to support
Understanding needs: Regular touchpoints to gather feedback and understand nuanced client requirements over time. Visit client sites.
Expectation management: Setting realistic expectations on enhancements’ timelines, capabilities, and costs Educating clients.
Issue resolution: Route and track client issues to resolve. Follow up on pending needs.
Advocacy: Serve as the “voice of the customer” internally. Advise on client relationship risks.
Cross-selling/upselling: Look for expansion opportunities within accounts. Craft value stories.
Contract renewals: Manage renewal relationships and negotiate contracts.
Event support: Coordinate events like user groups, conferences, and summits.
Reporting: Share customer feedback and metrics on satisfaction, adoption and ROI.

BRMs provide a high-touch, trusted partnership that is often new for internal IT groups used to dictating solutions. BRMs should be aware of the potential risks that can arise in client relationships. One risk is the possibility of clients feeling pressured or overwhelmed by cross-selling and upselling efforts. BRMS must approach expansion opportunities delicately and craft value stories demonstrating the client’s benefits. Another risk is the potential for contract renewals to become contentious if the relationship between the client and the BRM needs to be managed effectively. BRMs should prioritise maintaining positive renewal relationships and be skilled negotiators in contract discussions. Additionally, BRMs may be called upon to support and coordinate events for clients, such as user groups, conferences, and summits. This requires strong organisational skills and the ability to ensure smooth event execution.

Building Marketing Capabilities

Selling to external clients requires dedicated marketing capabilities, including:

Product messaging: Craft compelling positioning and value propositions tailored to external buyer needs rather than technical specifications. Provide ROI calculations.
Content development: Create content like whitepapers, ebooks, demos, and presentations that educate prospects on business challenges. Participate in industry events.
Campaign management: Plan integrated nurture streams, ads, and promotions to move prospects through the funnel. Track leads.
Sales enablement: Equip the sales team with messaging, competitive intel, objection handling, and productivity tools to convert leads.
Website and SEO: Develop an external-facing website for prospects researching solutions. Execute SEO strategies to boost discovery.
Branding: Define external brand identity, logos, and design standards across collaterals for a professional image.
Market research: Stay on top of customer needs, competitor offerings, pricing, and industry trends through ongoing research.

Marketing injects customer-centricity and elevates the professionalism of the go-to-market. Marketing injects customer-centricity and promotes the professionalism of the go-to-market by ensuring that all communication and promotional materials are tailored to meet the needs and preferences of the target audience. It helps to create a strong brand presence and build trust among potential customers. Additionally, marketing plays a crucial role in analysing market trends and competitor offerings, allowing businesses to adapt and stay ahead in the competitive landscape. Overall, marketing acts as a bridge between the company and its customers, maximising the chances of converting leads into loyal customers.

Impacts on Internal Groups

Commercialising IT solutions disrupts internal groups accustomed to dedicated systems, resources, and processes. Key steps include:

Communication: Proactively inform internal stakeholders early regarding commercialisation plans and potential impacts. Be transparent. This will help build trust and ensure everyone is on the same page. It is essential to communicate the benefits of commercialising IT solutions and how they will improve efficiency and effectiveness within the organisation. Additionally, providing training and support to employees during the transition period will help alleviate any concerns and allow for a smoother integration of the new systems and processes.
Staffing strategy: Be clear about staffing models—dedicated teams, shared teams, centralised pools, etc.—and how priorities between internal and external work will be managed. It is essential to have a clear staffing strategy in place when commercialising IT solutions. This strategy should outline whether dedicated teams, shared teams, or a centralised pool of staff will be utilised. It should also address how priorities between internal and external work will be managed to ensure an efficient allocation of resources. By clearly defining these staffing models and preferences, the organisation can effectively manage workloads and optimise the utilisation of internal and external resources.
Governance: Establish escalation processes and change review boards involving internal groups for significant external commitments that may impact internal users. These processes and boards will ensure internal stakeholders have a say in decisions affecting their workload or resources. Additionally, regular communication and collaboration between internal and external teams will be promoted to foster a more efficient allocation of resources. By involving internal groups in the governance of external commitments, the organisation can mitigate potential conflicts and ensure that resources are utilised effectively.
Capacity planning: Build forecasts for internal vs. external demand. Develop strategies to scale delivery teams to match the load. Leverage partners as needed. Capacity planning is a crucial aspect of resource allocation within an organisation. The organisation can accurately assess the resources required to meet customer requirements by building forecasts for internal and external demand. This includes developing strategies to scale delivery teams, hiring additional staff, or leveraging partnerships with external vendors. By taking a proactive approach to capacity planning, the organisation can ensure that resources are effectively utilised and avoid any bottlenecks or inefficiencies in meeting customer demands.
Change management: Plan and support internal groups through the transition of IT becoming a profit centre rather than a pure cost centre. Address cultural change. Create a clear communication plan to educate the internal groups about the benefits and opportunities of IT becoming a profit centre. Provide regular updates and training sessions to address any concerns or resistance to the cultural change. Additionally, establish a feedback mechanism to gather employee insights and make necessary adjustments to the change management strategy. By addressing cultural change and providing support throughout the transition, the organisation can successfully navigate the shift and ensure buy-in from all stakeholders.

Proactively managing change prevents internal friction. It helps to create a positive and inclusive work environment where employees feel valued and supported throughout the change process. This can be achieved by promoting open communication channels and actively involving employees in decision-making processes. By proactively managing change, the organisation can minimise resistance and maximise employee engagement, leading to a smoother transition and, ultimately, a more successful outcome.

Uplifting Business Functions

Beyond IT and marketing, other groups like Finance, Legal, HR and Operations need to develop new capabilities for monetising IT, including:

Legal: Develop appropriate external client contracts. Negotiate terms and conditions. Update IP ownership, liability policies, etc. HR: Adapt hiring and onboarding processes to attract and retain IT talent. Implement training programmes to upskill employees in new technologies and foster a culture of innovation.
Finance: Evaluate and implement new financial models to account for the potential revenue streams generated by IT initiatives. Collaborate with IT to develop cost-effective strategies for technology investments. Operations: Streamline processes and workflows to optimise the integration of IT systems. Ensure smooth coordination between different departments to maximise efficiency and minimise disruptions during the transition.
By addressing the specific needs of these departments and providing the necessary resources and support, the organisation can uplift its overall business functions and fully leverage the benefits of IT monetisation.

Finance: Implement financial reporting, invoicing, revenue recognition, and collections processes to run IT solutions as a proper P&L. This will allow the finance department to accurately track and analyse the financial impact of IT investments, ensuring transparency and accountability. Additionally, integrating IT systems with financial processes will streamline operations, reducing manual errors and increasing efficiency. By aligning IT and finance, the organisation can make data-driven decisions and optimise resource allocation, ultimately driving profitability and growth.

HR: Design sales compensation plans. Hire business development resources—source talent with customer-facing skills. HR is crucial in driving profitability and growth by designing sales compensation plans. These plans incentivise and motivate the sales team to achieve their targets, ultimately contributing to financial success. In addition, HR needs to focus on hiring business development resources with customer-facing skills, as these employees will play a vital role in acquiring new customers and expanding the organisation’s market reach. By sourcing talent strategically, HR can ensure that the organisation has the right people to drive revenue and achieve financial goals.

Operations: Model customer onboarding, support, incident handling, and SLAs. Set up client infrastructure and tool access. Streamline processes and systems to ensure efficient and effective customer onboarding, support, and incident handling. Implement Service Level Agreements (SLAs) to guarantee prompt resolution of customer issues and maintain high levels of customer satisfaction. Additionally, it provides clients with seamless access to necessary infrastructure and tools to facilitate their operations and enable smooth collaboration with the organisation.

Product: Build product roadmaps, balancing internal and external enhancement priorities. Define licensing and pricing models. Develop product roadmaps that align with the organisation’s internal goals and the external demands of the market. This will ensure that enhancements are prioritised effectively to meet customer needs and expectations. Additionally, establish licensing and pricing models that are fair and competitive, taking into account factors such as product value, market trends, and customer feedback. These strategies will help drive product success and maximise revenue generation.

Updated business processes, talent and governance are required to run IT like a customer-focused software business. This includes implementing agile methodologies and customer-centric practises to ensure constant improvement and meet evolving customer demands. Investing in talent acquisition and development is crucial to having the right skills and expertise to deliver high-quality software solutions. Furthermore, establishing a governance framework that promotes collaboration and decision-making based on customer feedback will enable the organisation to make informed decisions and stay ahead of the competition. Adopting these measures allows the company to effectively run IT as a customer-focused software business and achieve long-term success.

The journey from internal systems to externally sold solutions requires strategic realignment across many functions. Significant new revenue streams can be captured with proper planning and investment in new capabilities. These new capabilities include enhancing the user experience, implementing advanced analytics to gain insights from customer data, and developing agile and scalable software solutions. The company can attract and retain new customers by focusing on customer needs and continuously improving products and services. This strategic realignment ensures that the organisation remains adaptable and responsive to market changes, ultimately leading to long-term success and a competitive edge in the industry.

Furthermore, by investing in cutting-edge technology and innovation, the company can stay ahead of its competitors. This can involve embracing new trends such as artificial intelligence and machine learning to automate processes and provide personalised recommendations to customers. Additionally, the company can leverage data-driven decision-making to identify emerging market trends and make proactive business decisions. By continuously pushing the boundaries of what is possible, the company can position itself as a leader in the industry and continually attract customers who value forward-thinking and innovative solutions while driving the all-important holy grail of cost neutrality for technology within the organisation.