The IT organization of the future will focus more on consulting and guiding the business in technology decisions than on building or even running IT. As business users increasingly procure and even build the applications
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"It's a very broad definition of consulting. It's providing direction, it is providing oversight, it's providing value," said Marc Cecere, a principal analyst at Forrester Research Inc. and a keynote speaker at the firm's recent IT Forum in Las Vegas. The IT status quo is about to be toppled, if speakers at the forum are correct. That "sea change" will fundamentally alter IT roles and the scale of IT operations at many midsized and larger enterprises. For CIOs, it is none too soon to start building the IT organization of the future.
Even as information technology becomes integral to more industries, Forrester data suggest that, ironically, IT is in danger of being perceived as irrelevant to the business. A recent Forrester survey of 2,691 business decision makers demonstrates the paradox, said Sharyn Leaver, practice leader for enterprise architecture and CIO at Forrester. While 87% of those surveyed said they believe the future of their organization hinges on technology innovation, more than a third of that group did not consider IT as the source of new ideas. In addition, 65% of the business leaders surveyed told Forrester they had budgets to buy technology within their group without involving IT.
"Everybody believes they are a digital business. That's the good news," Leaver told IT Forum attendees. "The downside is that 35% of that group said they do not involve IT at all -- never pick up the phone and talk to anyone in IT to come up with new and innovative ideas on utilizing technology to grow their business."
What should the IT organization of the future look like? According to Forrester, CIOs first must come to terms with two major trends: the enterprise's need for speed, and an increasingly technology-savvy and self-sufficient workforce.
Even when business leaders understand the value of technology integration and scalability, they will bypass IT if these standards jeopardize their ability to get to market fast, the Forrester survey showed. Moreover, Software-as-a-Service tools and cloud computing make it possible for the business to provision technology without IT.
Of the so-called Generation Y employees (those 18 to 30 years old) surveyed by Forrester, 64% said they downloaded unauthorized applications or visited unauthorized Web sites at least once a week to get their jobs done; and at least 40% do the same on a daily basis, Leaver said.
"The combination of this need for speed, along with self-service technology and the tech-savvy workforce, we at Forrester believe will truly topple the IT status quo," Leaver said.
IT roles and responsibilities
The new reality -- the need for speed plus a tech-savvy workforce -- was evident throughout the conference. Speakers and attendees stressed the effort of CIOs to adapt their IT organizations. Warren Ritchie, CIO at Volkswagen Group of America Inc., remains convinced that the success of the IT organization of the future -- at least at global companies -- will depend on parsing the IT services to be centralized, and the IT roles needed to support the unique qualities of each market.
The combination of this need for speed, along with self-service technology and the tech-savvy workforce, we believe will truly topple the IT status quo.
Sharyn Leaver, vice president, Forrester Research Inc.
Unique to the U.S. market is the rapid adoption of intelligent devices that are redefining how Americans work and connect, in Ritchie's view. Therefore, IT should be thinking about how the "connected vehicle" (the car as a rolling computer) can improve customer service and Volkswagen products. Volkswagen's marketing department might be taking the lead on customer service, but leveraging the corporate data amassed by these smart vehicles must be IT's province, he said. To that end, he is recruiting data specialists from other car companies and is "wresting some of the data services work" away from the company's digital marketing agency, IT's "prime competitor."
"There is this interesting tension between what is a product and what is a service and what is IT's role. Both sides recognize the tension and are sorting out the actual roles now," Ritchie said.
On a broader scale, Ritchie is reorganizing his IT department "around innovation," even managing to set aside 8% of his budget for innovation. To change the business's perception of IT as a utility, he is waging the battle on numerous fronts, setting up "sandbox environments" for proofs of concept, building architectures that support cloud and mobile apps, and allowing business areas to self-provision iPads and iPhones.
One of Ritchie's biggest challenges is educating the business on the complexity of the IT infrastructure required to support a nimble enterprise -- and how that differs fundamentally from the type of consumer IT purchased at a Best Buy, he said. "We need to start building below the waterline, and the business needs to understand what exists below the waterline."
The transformation of IT organizations from technology-doers to expert guides resonated with attendee Kelly D'Eath, who oversees the business systems analysis services team at Calgary-based energy company TransCanada Corp. "We're already seeing that in some parts of the TransCanada IT organization, where the team I am building will be more a consulting team than a 'builder' team," she said.
D'Eath has not hired new people -- yet, she said. But the shift in approach "does allow us to consider other options for buying rather than building the services required."
Empowered BT in the IT organization of the future
Forrester describes the effective IT organization of the future as facilitating "empowered business technology (BT)." What does that mean? As opposed to aligned IT, where the bulk of the IT work gets done by the IT organization, or to embedded BT, where most of the IT choices will be made by the business, empowered BT represents a middle course, Cecere said.
"In this middle area, what you have is a shared responsibility for information technology between the business and between the IT organization," Cecere said.
Traditional application developers will act as guides for these business people to make sure the technology the business is building is secure and scalable, Cecere said. IT project managers will not be running one project at a time but overseeing numerous projects simultaneously. Vendor management offices will be "template-izing" their expertise for business employees who are procuring IT services, Forrester analyst Stephanie Moore said. Among the most employable IT professionals, Cecere said, will be the enterprise architects who can design and integrate scalable systems, and the security specialists charged with inoculating those systems against the innumerable threats now facing the digital enterprise.
In the empowered BT model, business leaders might well go out to the cloud to grab the services and deploy and even maintain the services they need, "but they won't do it without IT people being involved," Cecere said.
Let us know what you think about the story; email Linda Tucci, Senior News Writer.