- 20 Nov 2009
- Lee Provoost
- No Comments
- Blog Post
“I’m fed up with our IT department. Why does it take 4 months to deliver a small project if I can have it right now and much cheaper as a hosted service?”
“Why are those IT guys spending three years on an SAP roll out? I want them to focus on projects that has a direct value for my sales and marketing! Who cares about that ugly ERP system that everybody hates?”
Chances are that if you are working for a large company, this will sound very familiar. I have to admit that it is hard to understand why the IT department is focused on a multi-million ERP consolidation project that doesn’t seem to help you at all in winning more deals. Even more, due to this “beast” of a project they don’t have time to help you in your Enterprise 2.0 / Web 2.0 endeavors. Double #FAIL.
Does that mean that IT departments are not with the times anymore? Are CEOs doing the wrong things? Is Enterprise 2.0 the big savior that will guide us through the economic difficult times?
Before jumping to any conclusions, let’s backtrack a bit to the root of the problem. The big disconnect between IT and business that you see in many companies can be explained by what you could call “the gap between IT stability and business agility”. IT has always been seen as a cost for a company, and especially in these economic times, that means that companies are trying to squeeze their IT budgets. The role of CIO or head of IT is one of the more difficult positions to be in: you get less and less budget, but somehow you need to deliver more and faster to the business units. (And let’s not forget that almost everyone in the company is putting you under pressure.)
So, there lies one of the roots of the problem: if you are an experienced IT head, you will be tempted to consolidate your systems and platforms. Kick back the plethora of small niche vendors and products and settle with one or two vendors. Most obvious choices are for instance to have an “SAP and Microsoft”-only (or IBM-only for that matter) policy. That means that in the former case you would have your ERP, CRM, KM, HR, BI, Portal from SAP and Office suite, server OS and database from Microsoft (just an example setup).
As you can see on the diagram, the price you pay for consolidating and reducing your IT platforms is that with a higher (IT) stability, the trade off is a lower (business) agility.
Does that mean that we should stop consolidating and reducing our IT systems and platforms? Not necessarily.. Remember that although you might never really “see” your ERP system, it does control the majority of the core processes of your company. Furthermore, it does not make sense for a company to have three different large ERP systems running, resulting in a situation where one business unit being unable to gain insight into other’s. Also, it’s pretty hard (and very expensive) for a company to hire an army of Oracle, SAP, Microsoft and IBM experts just to keep your systems up and running (in the assumption that you’re lucky enough to get hold of that expertise of course).
What you get is the realization that your IT department is running at a different speed than your business. IT is focused on the platforms and core systems with a long-term vision and planning, while the business wants to be able to adapt, on a day-by-day basis, to changing market conditions.
So, how can we approach this disconnection? Well, as a starter I believe we need to redefine what is expected from the IT department. As I posted earlier on a different blog the IT department should be transformed from a solutions provider to a solutions enabler. It is unrealistic to expect the IT department in a large organization to be as agile as an internet start-up or a cloud services provider. Corporate IT should focus on the core processes, the large back-end ERP systems, big desktop roll-outs, governance, compliance, etc. Instead of expecting them to deliver you every single piece of skunkworks project, small web application or social collaboration tool; take that power into your own hands. Hire external experts to help you with collaboration processes and tools, rent some services in the cloud for fast go-to-market. The IT department will help you with plugging your new system into the backed system by providing APIs and will help you integrate into the user directory or do security assessments upon your requests.
Does that sound scary? It does. But let’s look at the division of responsibilities:
- Focus on systems supporting core processes (ERP, CRM, etc.)
- Consolidating and rationalising the IT landscape
- Focus on security and compliance in the corporate IT landscape
- Open up parts of the back-end systems through APIs
- Focus on processes and applications that add direct business value
- Hire external expertise or rent cloud services to get the job done (regardless of the vendor policy of the IT department)
- Plug these applications into the company’s back-end systems by the APIs that have been provided by the IT department
So, the irony of being able to better align the goals of your business and IT lies in the fact that you actually have to completely disconnect the two.
Now the inevitable question is: “How are we going to reconnect Business with IT, considering the above mentioned challenges?” My next blog posts will introduce Social Business Design as a strategic framework for analysis and future implementation. It allows the traditional-IT-as-we-know to focus on its core function, whilst providing an evolutionary roadmap for satisfying the emergent needs of business and users whose expectations for IT service provisioning are increasingly informed by the consumer-facing social web.
That said, this is also my inaugural blog post for the Headshift blog. I recently joined the team in London and one of my roles will be to focus on helping our clients to solve this IT-business disconnect/reconnect problem. Previously, I worked for a global IT consulting firm / system’s integrator where I helped out IT departments to integrate their disconnected systems and advised business units on the disruptive change that new emerging technologies can bring. Follow my stream of thoughts on Twitter or drop me a mail for any questions
This post originally appeared on the Headshift blog.