Use Comparative Advantage To Become a Better CIO


Imagine that 3 people want to each open a sandwich shop. One man is a butcher, another is a farmer, and the third is a baker.

The butcher is an expert with meats. The farmer is an expert with produce. And the baker is an expert at making bread. Each is the master of their specific domain.

Of course, each of these could learn the other’s trades. With a bit of effort, the butcher could learn to grow vegetables and make his own bread. But this would not be the best use of his talents. If all three shops operated this way, they would all be overworked and under-productive.

Instead, it would make more sense for all three of these experts to focus on their strengths, and team up with other experts to make up where they lack.

• The butcher could produce all the meats for everyone.
• The farmer could supply all the produce.
• And the baker could supply all of the bread.

By creating partnering up and relying on each other’s comparative advantages, all three businesses could collectively operate much more efficiently and profitably. When there’s synergy, everyone wins!

Most IT managers are fast learners with versatile skill sets. However, there are some projects and capabilities that might provide more business value than others or be better-aligned with their specific talents.

According to the theory of comparative advantage, the key to maximizing your effectiveness as an IT leader is to focus exclusively on those high-value activities that are best-aligned with your talents. Any other work should be outsourced or delegated.

For example, if your strengths are best-aligned around things such as infrastructure management, then it might make sense to outsource non-core activities such as backup and disaster recovery to a trusted partner that specializes in this domain.

By focusing on your comparative advantage, you can be more productive, free up more time, and achieve total peace of mind.

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