As management consultants, we hear how a lot of organizations feel about their information systems. Familiar complaints about the IT department include:
“The department of NO”
“Where good ideas go to die”
“A black hole”
Not surprisingly, these comments arise when the IT organization is dysfunctional and systems are unstable. However, some of the same complaints arise where IT is professionally run and staff are qualified and engaged. Some other factor must be at work here!
Understanding the IT Paradox
The problem lies in approaching IT/IS as “just another department”. When you handle IT as a cost center, they focus internally on IT department budgets and KPIs. However, as soon as plans are set, new priorities and demands emerge, more work is inserted, and staff commitments waver. The IT department sits at the center of the storm, reacting in a vain attempt to control delivery and manage expectations.
To understand why this doesn’t work, consider the paradox that exists with information technology today:
- There are no “IT projects” in the sense that business benefits and business sponsorship should drive every initiative. On the other hand, IT is everywhere. Digital technology is a must. Every initiative is in some way dependent on IT.
- Control is elusive. Attempting to run all IT-related initiatives out of a central department creates a bottleneck. Demand for technology will invariably exceed the budgeted supply. On the other hand, running completely decentralized invites chaos and may increase both spending and time to business value.
- Sourcing options abound. Anyone with a credit card can purchase Software as a Service. Infrastructure services and support can be purchased from external managed service providers or cloud providers. For many businesses, it no longer makes sense to source desktop, compute, and storage resources internally. With sole emphasis on speed of delivery, questions of integration, standards and long term viability are buried below the surface, emerging later when expected value fails to materialize.
Moving Forward
So where does that leave us? For successful companies the answer is to abandon departmental thinking about the role of IT in favor of holistic thinking. This does not mean disbanding your IT department, but rather changing fundamental approaches and attitudes to meet the needs of the future rather than the past. Focus internal IT staff less on infrastructure support and application development. Apply their skills and attention toward business and industry innovation, and effective, integrated processes.
IT must orchestrate the services that make a modern company run.
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Old Thinking |
New Thinking |
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IT is a department that takes care of all our technology |
IT is an integrating discipline that helps us adopt the right technology quickly. IT partners with all departments to deliver initiatives |
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Our IT leader takes orders from the business and does his best to deliver the right technology |
Our IT leader is an integral part of the executive team and guides our technology direction |
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Business units and IT have their own agendas and run their projects accordingly |
All leaders buy in to a common governance framework for investment decisions and prioritization. There is one portfolio of projects for our business |
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IT is managed as a cost center. Investments in technology do not provide a measurable return, so we just try not to go over budget |
We have a clear idea of the external value we derive from our IT assets and make investment decisions accordingly |
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We buy stuff first then worry later about how it all fits together |
Our IT staff sets clear standards and ensures we are partnering with the right technology suppliers. Many services work together to form an integrated whole |
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We’re too busy keeping the lights on to think about innovation |
Our core mission is to help our business win in the marketplace |
