Change or Become IT Irrelevant

The time is fast approaching where all of your IT solutions across the enterprise will be delivered or coordinated from or by your IT department. As you dwell on this statement — do you believe it or not? Are you aware of the growing trend within many businesses where IT needs are being addressed without IT’s knowledge?

Business is accelerating and due to the rate and pace of innovation and change, IT will need to respond rapidly if it is to remain relevant.

At a recent industry conference, a procurement manager at a global financial organization shared with a group of us in a round table that a recent audit identified several instances of technology being acquired directly by the business with little or no involvement of IT. The procurement officer was alarmed, considering the work undertaken by IT to understand compliance, privacy and data security requirements. (Note to organizations you can look through expense reports for IT being purchased and consumed outside of policy or better still add this process to those of your expenses audit team.)

This example is not yet mainstream, but it is not as unique as you think it might be. Almost everyday I hear stories of business units bypassing their IT department or division to leverage technologies directly from third parties, especially in the areas of mobility, cloud services, service management, project and portfolio management, and video. This is the “perfect storm” for IT – the emergence of the consumerization of technology in parallel with technology-savvy business leaders who see unlimited uses for technology and refuse to be constrained by the ability of IT to deliver to their timetable.

Last month, the vice president of IT operations at a European financial organization told me how his group was dealing with the delivery of hybrid IT services. First, his definition of hybrid services was any business service that is delivered partially internally and partially by one or more third-party suppliers. After initial resistance to the delivery of these types of services – claiming that potential risks such as compliance and privacy requirements were too high – the company developed processes that reduced costs and improved their timetables to deliver capabilities. To leverage this service value chain, it was critical the organization understood the business service level and cost expectations, and more importantly, the priorities required so that IT could balance delivery, risk and compliance.

Many refer to the cloud computing “revolution” as a massive change in technology-one that makes it easier to bypass IT and its processes that are often seen as overly complex, rigid and slow. To succeed, IT will need to start focusing more on the execution and delivery of capabilities in a cadence that meets the needs of the business. If IT can’t change its perception of being all-controlling and inflexible, then its role may be marginalized.

Most forward-thinking CIO’s are using this opportunity to accelerate a transformation of their business innovation processes and become an aggregator of services or a service broker. This transformation will often involve the use of technologies such as social collaboration and analytics for decision making, but IT must work closely with the business to drive growth and customer engagement to implement a new management paradigm.

The closer IT can get to the business, the better they can map business strategies to their portfolios with sound financial stewardship, and more effectively source and manage vendors to support rapid innovation.

Technology sourcing and consumption is also moving beyond the CIO. The CIO, or more correctly in the new IT construct, the Office of the CIO, should provide an appropriate level of centralized coordination with third parties to match the delivery capabilities that deliver business value and competitive advantage. In this way, the CIO will become responsible for orchestrating technology sourcing and managing the supply, as well as facilitating the delivery of innovation based on business expectation. 

This new manner of consumption by IT is going to make the managed service provider even more relevant to the CIO. The CIO and the internal IT organization will transition to an aggregator of service, in essence becoming a proactive integrator of the technology components required to deliver differentiated business solutions that will change frequently and become more complex.

IT is at the beginning of a major transition. Change is inevitable, and it’s happening quickly.

It’s time for IT to change or risk becoming irrelevant.

Article source: CA PPM Blog

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