For many organizations, now is the time for annual strategic planning and for identifying where to invest in IT initiatives in 2013 and beyond. One of the key questions faced every year is deciding, given a limited budget, on the most attractive investment choices to make and on the percentage of the investment that should go toward core, adjacent and transformational projects.

A recent Harvard Business Review article points out that a typical allocation is something like 70/20/10, with 70% of the investment going into the core business, 20% into adjacencies and 10% into new, transformational initiatives. Interestingly, HBR points out that the financial returns are typically the inverse of the spend allocations -- that is to say, 70% of the returns come from the transformational initiatives and only 10% from the core.