Business Value in IT (With Definition and How-to Steps)

By Indeed Editorial Team

Published June 19, 2022

The Indeed Editorial Team comprises a diverse and talented team of writers, researchers and subject matter experts equipped with Indeed's data and insights to deliver useful tips to help guide your career journey.

For many companies, their Information Technology (IT) service can help them improve productivity. IT performs an essential role in helping companies achieve their objectives by providing services or goods in a productive and quality manner. Learning how to improve IT business value in a company can help you optimize its workflow. In this article, we explain what business value in IT is, list the importance, discuss methods for measuring IT business value, and provide steps to deliver it in a company.

What is business value in IT?

Business value in IT refers to the impacts of technology in generating benefits for a company's customers and stakeholders. IT business value typically determines the overall performance of a company in the long term. Companies often derive their IT business value from technology components and systems investments. It may also refer to a business's ability to create products, employment, services, and investment returns. This can enable companies to determine the economic value of their business.

A business's IT value may cover the monetary and non-monetary assets. For example, a company's business value may comprise its equity, fixtures, trademark, and brand. IT business value usually impacts how customers perceive an organization as a value-based service provider.

What's the importance of IT business value?

IT business value is essential because it enables organizations to assess their assets accurately. By working with a proper financial figure, business owners can determine the amount to reinvest into technology components that improve their services. It also enables companies to focus on providing a better customer experience to improve profit. For example, companies can measure their business value through surveys to understand their customer's needs. This can help them identify the IT services that can meet their customer's demands.

With it, businesses can build customer loyalty, which is a significant key performance indicator (KPI) to deliver business value. IT business value is also important for helping a company gain a competitive advantage over its competitors. It typically enables companies to identify their strengths and weaknesses to innovate and provide value for clients continually.

Related: Public Sector Jobs (With Description and Salary Information)

Methods for measuring IT business value

Measuring the business value of IT can help companies create plans for new technology investments and determine budgets for ongoing support projects. The following are elements a company can measure to determine its IT business value:


One significant indicator for measuring a company's business value is revenue. This indicator acts as a figure that enables businesses to determine the total income they generate while supporting ongoing or new IT investments. When a company can easily identify this cost, it can calculate its return on investment (ROI). ROI refers to metrics that companies use to determine the profitability of an investment. If the company's total revenue increases, it usually means that the IT services are contributing positively to it.

Customer loyalty

It's essential that IT investments support a company's growth by helping them improve customer satisfaction. When determining IT business value, companies often measure its benefits to customers, such as positive experience, responsive support, and quality goods or services. Customers that are loyal to a company usually purchase its product regardless of price. They often care about receiving the same value and quality from a company's IT service or product. For example, IT services can improve a business's customer loyalty by providing positive interactions through a user-friendly website that offers quality customer service.

Related: What Is Financial Technology (With Examples and Skills)


This is an accounting metric that companies can use to determine the financial success of their IT services. This metric considers a business's size to determine its relative profit ratio. The profit ratio refers to the ability of a company to generate earnings against expenses. Companies often use profitability to track the changes in the efficiency of IT components. A business can improve its IT services, and its profit may increase. For example, a company's cost reduction can help it identify the IT services to discard if its profitability score remains the same over a particular period.

Market share

Market share typically determines a company's revenue as a percentage of an industry's entire revenue. When a business gains market share and its customer retention rate increases, it can be certain that it's delivering the proper value to customers. Customer retention rate refers to the percentage of customers a business retains over a particular period. With this metric, businesses can determine whether a competitor delivers more or better value than their IT services.

How to deliver IT business value

Follow these steps to know how you can deliver IT business value:

1. Outline a clear vision

It's essential you understand the company's goals and the objectives they want to achieve. For example, a company may have a strategic goal to reduce the delivery time of its product to customers. Meeting this goal requires creating business processes that directly influence the time it takes customers to receive a product. You can implement IT services that accurately manage the company's inventory and improve the efficiency of the packaging machines. Having a clear vision can help you quickly measure the IT business value. Tips that can enable you to create a vision statement include:

  • Ensure it's clear and concise.

  • Keep the statement relevant to a business's target market.

  • Focus on the company's long- and short-term goals.

2. Align the company's IT strategy with its goals

Aligning a company's IT strategy with its business goals is essential to improving efficiency. It can also help the company reduce costs, improve customer and supplier relationships, and generate new products. Organizations that align IT strategy with their business goals experience low production costs and more revenue. This enables them to measure IT's contribution to their business and identify resources that can help them provide more value. By doing this, you can easily communicate the IT strategy to employees and link it to the company's budget.

Related: 10 Technology Careers (With Salaries and Primary Duties)

3. Increase revenue

Organizations can increase their revenue through innovation. They can create new opportunities or improve the function of existing IT services. These organizations can also enter new markets and sell their products globally. When companies use effective technology-driven marketing tools, such as search engine optimization (SEO) and pay-per-click advertising, they can implement IT services to create more awareness and sell more products.

4. Improve productivity

Several ways IT services can improve productivity include:

  • Increasing employee efficiency by eliminating boring and repetitive tasks

  • Implementing business software and algorithms to simplify production, accounting, and sales

  • Streamlining warehouse efficiency with inventory management applications

  • Implementing video conferencing technologies to reduce travel and improve training and meeting time

  • Using data to segment a company's online marketing to improve the personalization of each message

  • Using applications to process payments immediately

Companies using IT services can relieve employees of stressful tasks, enabling them to acquire more skills to manage automated software and hardware.

Related: What Does an IT Manager Do? (And How to Become One)

5. Improve customer satisfaction

You can create value from a company's IT services by improving customer satisfaction. Many companies' source of revenue is often from their existing customers. Consider using surveys to collect customer feedback and determine areas for improvement. You may also create several social media channels to make it easier for customers to contact the company. Implementing a responsive live chat and e-mail support can improve customer satisfaction.

6. Increase collaboration among multiple departments

Implementing IT services that improve collaboration can offer the company a competitive advantage. For example, providing field service teams with smartphones can enable engineers to build a more efficient and fast service to customers. These engineers working on the customer site may create voice or video conference calls with a company's technical or product expert to resolve complex issues. You can streamline a company's operation, ensuring that every employee works towards a common goal.

7. Secure the company's data

It's important that a company improves its IT service's security to avoid a data breach. Data is a valuable asset of any company. Protecting it from external or internal corruption and illegal access can help a company save money and build customer trust. When customers know their data is safe, they may be willing to share more information with the business. Consider using IT services that can help a company strengthen its data security and reduce exposure to personal information while optimizing the user experience. Securing a company's data can reduce business risks and fraud.

Explore more articles