Say goodbye to the calcified, creaky business systems and processes that we’ve come to know and love. They’re being swept away by clouds and mobile systems at an alarming rate. But that’s a positive thing, of course. With this transformation, however, comes a need for deeper knowledge and understanding of the new systems and processes that are driving new businesses, how they interact, and what they are capable of delivering.
In the process, CEO, CFOs and COOs are becoming more immersed in technology decisions, while CIOs and CTOs — and their IT staff members as well — are being asked to join in on high-level decision-making teams.
That’s one of the key takeaways from a recent report published by CompTIA, an IT industry trade group. The report’s authors note that “new technologies such as cloud and mobility account for nearly all projected revenue growth in the IT industry.” The net effect, the report notes, is increased options and increased complexity. This is having an impact on businesses of all sizes, but is especially being felt by leaders of mid-sized companies which were interviewed by the study’s authors for the report.
Business leaders are getting more involved in technology decisions than ever before. To a large extent, many previously non-tech businesses are evolving into technology businesses. A manufacturer of engine components, for example, now relies on software — either developed in-house or purchased — that sets the design points and tolerances of the components being produced on lathes and other machines. An export-import business now engages customers across the globe through e-commerce-based transactions, using sites and tools developed in-house or contracted through the cloud.
To grasp all this new complexity, business leaders will be depending on IT executives and professionals more than ever. This is accelerating the transition of IT departments (and their people) from simply being service departments to technology brokers and active advisers at the highest levels of the business. Corporate IT’s power and influence over business is growing (not waning), but multiple business leaders now have a voice in IT’s direction. “Business unit leaders certainly have more say in IT decisions. But as cloud, mobile, big data and social waves grow larger, central IT will emerge as a service broker to in-house and third-party IT offerings.”
IT’s transformation into an internal service provider is in its infancy and will require several years to complete, the report’s authors predict. “Business executives and employees want self-service applications, but that requires several stages of IT investment,” they state.
At the same time, corporate IT decisions are increasingly made via ad-hoc committees involving multiple business units, the report states. “While CIOs typically make the final call, peer CXOs and business unitleaders have a strong say in how IT systems are aligned to meet corporate goals. Those CXO and business unit voices have even more say if an IT project involves applications (rather than underlying infrastructure).”
This observation gels with another industry report, issued by Technology Business Research (TBR), which posits that business executives are playing greater roles in technology decisions as their organizations grow increasingly dependent on cloud computing services. In the process, the role of IT staff — particularly developers — is being elevated to part of the business leadership team.
The experience of one insurance company CIO was recounted in the CompTIA report:
“Our innovation effort includes three teams of business and IT leaders: (1) one to generate ideas; (2) folks who are tasked with finding the right resources internally to address the ideas and opportunities; and (3) a so-called innovation garage to build the prototype solutions. Five people from IT work in the innovation garage. They rotate in and out on 12- to 18-month schedules. When they rotate back into their specific departments, they have greater skills focused on innovation rather than maintenance.”
This alignment is seen as key to figuring out the best ways to approach cloud, mobile and digital in this brave new world. As the CompTIA report’s authors state, the competitive advantages of these new technology platforms are well understood: “Somewhat similar to public cloud service providers, midmarket businesses are building private clouds that deliver infrastructure and applications on-demand to employees and customers. The resulting hybrid cloud world will further accelerate innovation cycles—allowing businesses to enter new markets more rapidly.”
Thus, there’s a driving demand for business and IT executives, managers and staff to work as one, and “the line between business operations and IT must further blur—and may even disappear in some cases.”
As the CIO of a manufacturing company explained:
“The alignment of business and IT is all about striking the right balance. I think it’s a good balance in our company. It has evolved over
time because both sides have gotten wiser. The business has an appreciation for what we’re doing, and we have an appreciation for their
needs. In a lot of companies, it’s difficult for CIOs to show the value of IT. They are so focused on keeping the lights on, which means IT is a
cost-reduction story rather than an innovation story. Once you commit to innovation cycles between business and IT, the innovation can happen even faster.”
Or, as the CIO of a city government agency expressed it very nicely:
“When you’re growing as a person you’re more inclined to think like an innovator. IT has to help spark that.”