Standing at the Crossroads
Over the past few months, Ive had many conversations with IT leaders and regular CIOs about the state of IT; where its going, why, and whats stopping it from reaching its full (and anticipated) potential.
In short, while many business folks bemoan ITs failures to deliver on better, faster, cheaper, the truth is IT is just getting started. Think about 10 years ago: green screens were still common; the Web was just taking off as a commercial medium; client/server ruled the roost; Moores Law was just taking hold; hardware costs were just beginning their precipitous decline; software was something you bought in shrink wrap (or, more likely, developed yourself); the home PC market was just taking off; a cell phone in every pocket was just a dream; connectivity was some obscure way of being in two places at once; WiFi and Bluetooth were magic; etc., etc., etc.
Today, just a quick decade later, everything really is different. Everything I listed above has changed. Unlike the semi-controllable yet highly diversified computing infrastructure of yesteryear, todays CIO is in charge of a mash-up, a Wild West if you will, of consumer technologies crashing headlong into the once tightly controlled space called corporate IT.
IT today is driven by user demand, not by IT. IT today has to think in brand new terms like service, value and innovation. IT today is no longer about IT, but about business enablement and alignment and agility.
Yet, none of these things has anything to do with ITs traditional role as a business process-streamlining organization. The problem is, IT is still structured to be an optimizing organization, not an enablement organization. All of the technology that was put in place either for technologys sake (think late 90s, early 00s) or to keep up with the competition (ERP, CRM, Supply Chain, etc.) is still in place. Thats mainframes, PCs, distributed data centers (i.e., minis in the closet of a remote office somewhere), rack mounted servers, Blade servers, WiFi a/p's, thin client, tablets PCs, readers, etc., etc. In most large organizations, all of that is still working somewhere, doing something, for someone.
Add to this the hundreds or, in some cases, thousands of different, proprietary software titles (both in-house and off the shelf) that IT supports and you have an organization that spends 70% to 80% of its time and budget just keeping things running, let alone innovating. And that number is increasing, not decreasing. Not yet anyway.
Even with this often overwhelming burden, business folks are now asking IT to help do things it was never intended to doopen new markets, for example, or reach customers in new ways. The truth is most IT departments are just now getting a handle the morass of technology and software that supports the enterprise and many large SMBs. Hence the rise of ITIL, project management, SOA, governance, CoBIT, and a plethora of other methodologies designed to turn IT from an ad-hoc, do-it-on-the-fly, firefighting organization into one that runs more like the rest of the business, with repeatable processes that lead to predictable outcomes.
But we are only on the cusp of this transformation. Even though automated management solutions seem to abound, many organizations today dont even know how many applications they have running, let alone who is using them and for what purpose. As new IT management and simplification technologies like virtualization, auto discovery tools for asset management, auto provisioning, etc. have come online, IT has finally been able to begin focusing on reining in the hardware side of things.
Application rationalization efforts are also under way, but the technology to distribute, say, one hosted instance that replaces 10 or 100 instances of SAP to the entire organization via SaaS has only recently become feasible. Also, like the chicken and the egg, its hard to know which to do firsthardware or software consolidationso it seems many organizations are trying to do both at the same time. This is fine, but it takes more time and you have to avoid the deadly peril of unintended consequencesa bad day for IT is no longer an inconvenience. It can cost millions in lost revenue. High stakes, indeed.
New Roles, New Responsibilities
By all accounts, IT today is being asked to assist with roles once the solitary domain of say Marketing, Sales, Operations, or Finance. Because so much of todays world depends on IT to function, everyone thinks IT has all the answers. Its just not the case. To date, for the most part, IT has only provided the solutions the business has asked for. Little in the way of impact or
And it is a cost center. No doubt about it. IT is expensive. On average, two percent to four percent of a companys gross earnings. But, without IT, there are no gross earnings, so the business pays. Whats changed is now the business wants more bang for its buck. Had Y2K not passed almost unnoticed after all the Chicken Little talk of the late 90s and had the dot-com bubble not imploded, IT may still be doing things just for the sake of doing them. But these events did happen and IT now finds itself having to justifyat least to the CFOwhy things cost what they do and why IT needs the budgets it needs. Of course, all business units have to do this. The point is, until recently, IT has never really had toat least not in business terms.
The very people who run and staff it are also being asked to change. Traditionally, IT has been the home of computer science grads and other, like-minded techies or geeksheads-down people very good at technology but with very little interest in or understanding of the business they were supporting. And that was fine for a long time. Today, however, IT folks are being asked to think like business people. But, its still the same people in most IT departments. Most CIOs today come from IT, not the business. This means they still lack a deep understanding of how business, any business, works. And this means that asking them to become Marketing folks or Compliance officers or, indeed the leaders their C-title implies, is a tall order.
This is not to say they are deadweights on the organization. Far from it. Someone still needs to lead the technology transformation that is under way. And they are the people to do it. They are just going to need more help in understanding the imperatives that drive what the business wants so they can implement the right technologies to make it happen. And, caveat emptor, those technologies will have to support what the business wants in the future, as wella future rife, as weve seen all to clearly this past decade, with unanticipated change.
But there is hope for beleaguered CIOs as it now appears the business gets this also. In this most recent economic downturn, IT budgets have not been slashed as they were in 2002/03/04. Whats been reduced this year is just the budget increases. What this says is the business now knows the importance of IT and has elevated it beyond a maintenance organization. But only just.
What the business needs to learn next is the poor step-child structure that IT operated under until now, i.e., being a glorified order-taker, has led to the current situation. And until IT can do the housekeeping required to shed itself of all of the old hardware and software that doesnt make any economic sense to keep around anymore and restructure its infrastructure to allow faster, more cost-effective and agile delivery of new services, providing the business with what it really wants, is going to take some time.
Turning the Corner
Of course, there is the communication issue that must be bridged, as well. Techies running IT mean business folks and IT are still struggling to understand each other. In a recent conversation with the former head of Requirements for Zurich Financial Services, I learned that many of the developers working on in-house projects had no idea what the most basic business terminology meant. To gauge this, he would go around and ask what insured meant and almost no one knew even though the projects they were working on were for the insurance side of
Its not that IT doesnt want to provide what the business needs, its just that the business cant wait for IT to catch up so it is always demanding more. But markets move too fast and the competition is always looking for an opening so there is no lag time, no time for IT to catch its collective breath and change. IT today is so busy with so many new and fundamental changestechnological, operational, staffing, governance, leadership, etc.that the business doesnt understand, nor care to, that conflict is almost unavoidable. This leads to friction because without IT there is no business. Today, more than ever, business has to depend on something it doesnt understand, cant control and needs to work. That is scary.
Looking ahead, though, there is reason to believe that the two sides will come together with a common purpose and a common language. There are many hurdles yet to overcome, but progress is being made on almost all fronts. Software is finally powerful enough to deliver to the business what it really wantssimplicity, reliability, speed, agility, depth, connectivity, collaborationwhile IT is finally able to employ its own management applications and architectural methodologies (think SOA/ITIL) that will allow it to be able to deliver on the promise these strides in software engineering are bringing about.
Granted, what appears to be simple on the surface is often supported by a complex, cobbled-together mash-up of old and new technologies that requires constant vigilance. But this is the point. Software is becoming truly plug and play for the vast majority of users; even if IT knows all too well the headaches associated with making that happen. But, thats ITs job nowto make the difficult appear effortless, almost whimsical. And thats all that business users want. They dont want to know, nor do they care, how hard it might be on the back end. They just need technology to work. It has to work. They have their own convoluted challenges to overcome if the business is to survive and figuring out how to use the software tools that have become so indispensable in just a few short years, shouldnt be one of them.
This is what many IT shops still need to learn about business. Even though many think they know, its best not to assume too much until you walk a mile in their shoes. Spend some time in salesthe heartbeat of every company big and smallto get a feeling for what the word competition really means. You can then go back and complain to your staff about the demands placed upon you if you want, but chances are you wont be quite so vociferous about it once you see how the real world of business works (or doesnt work or make any sense whatsoever sometimes).
This is the reality today. At some point in the not-to-distant future, there will be very little distinction between IT and business. One will absorb the other just as the network is likely to absorb what we call IT today. Like the telephone, IT will just be there. It will in the truest sense of the word be ubiquitous. It will simply mesh into the fabric of business just like electricity, the cubicle or the fluorescent light bulb.
The Short List
Heres a short list to share with whomever you think will feel the pain of your plight. Its just a listing in no particular order (since on any given day any one of these things can rise to the top of the list) of the many projects, technologies, and, basically, things that you as the CIO and IT in general are having to deal with on a daily basis. Every single one of these has a break out of sub-headings that can and often does fill volumes of 3-ring binders:
▫ Keeping the Lights On
▫ Consumer Products Entering the Workspace
▫ Legacy Hardware and Software (and making it work with new stuff)
▫ Project Management (business projects as well as IT projects)
▫ IT Service Management
▫ ITIL, CoBIT, ValIT, et. al.
▫ eDiscovery (i.e., the legal implications of data archiving)
▫ CRM, ERP (yes, theyre still out there taking over the world)
▫ Outsourcing/Offshoring (not always the same thing)
▫ Increasing Maturity Levels based on the CMMi index.
▫ IT Security VPNs, war driving, hackers, laptop, PC, etc., WAN, LAN, gigabyte key fobs, iPhones, encryption, etc., etc.
▫ Physical Security
▫ Compliance Issues
▫ Web 1.0, Web 2.0 Web 3.0?
▫ Mobility/VoIP/Unified Communications
▫ Application Rationalization
▫ IT Commoditization
▫ Green IT
▫ New Market Enablement
▫ Silos (organizational and technological)
▫ Budget Issues
▫ Staffing H1B, aging workforce issues, Gen X/Y, work/life issues
▫ Open Source Software vs. Buying Proprietary Licenses vs. In-House Development
▫ Cloud Computing
▫ Business Intelligence
▫ Running IT like a Business
▫ Etc., etc., etc.