IT Focus Area: strategy
November 7, 2014
The Role of the IT Executive is Changing: Are You Ready?
Mobility. Virtualization. Cloud computing. IT has changed rapidly over the past few years.
Just years ago, IT had complete control over all its services. IT approved every request, delivered every piece of software and kept all its data in a closed environment within the corporate network.
Now, business units are no longer beholden to IT. They can research and purchase technology online—completely bypassing IT.
In today’s hyper-competitive marketplace, businesses are relying on technology to move quickly and stay ahead of the competition. The agility of software-as-a-service (SaaS) is allowing companies to become more dynamic, meet customer needs and gain a competitive edge. Just consider how the following companies have used SaaS to disrupt their industries:
Netflix moved video rentals away from Blockbuster.
Airbnb has become a compelling alternative to traditional hotel bookings.
Uber is giving cab companies a run for their money.
As an IT executive, how do you provide a platform for innovation while keeping your mission-critical data and applications secure?
The Most Successful IT Leaders Are Brokers, Not Just Builders
In the past, you could lean back and wait for requests to come in. Now, business units are taking a “do-it-yourself” approach to technology and putting corporate data at risk with shadow IT. This has caused successful IT executives to take a more proactive and consultative approach—moving from technology builders to technology brokers.
As a broker, you are still responsible for delivering technology and protecting your company’s assets and brand. However, you also increase your value by:
Innovating on the behalf of the customer. You show your organization how to use technology to launch new services, improve the delivery of existing services, change business models and expand into new markets.
Innovating on the behalf of the employee. In the past, IT provided employees with productivity technology and tools. Just like the steam engine made physical laborers more productive, information technology has made knowledge workers more productive. Now, in addition to increased productivity, employees also need technology that makes it easier for them to deliver value to customers.
Innovating on behalf of the company. You show your company how to use technology to be more efficient, link to new values chains and reach new markets.
Achieving these goals means taking the focus off the technology and putting it on the business.
As an IT broker, you evaluate the landscape and think about how changes in the market impact your company. You recommend technologies and service options that help business units reach their goals.
You can now match the needs of business units to service options such as low- versus high-performance or 99 percent versus 99.9 percent availability. You also help business units select the best sourcing option (e.g. public cloud, private cloud or a hybrid cloud model).
This is the service broker model. However, you can only achieve these benefits if you know your organization’s competitive advantages and business strategy. You also should have an IT roadmap that aligns with your organization’s business goals.
7 Reasons Why IT Executives Should Become an IT Service Broker
When you use a service broker model, you run the IT department like a business. This allows you to align your team’s goals with your company’s goals, so you can:
1. Free up your time and money for innovation. By taking advantage of services that may be sourced outside of internal IT, you will have more time and money to focus on innovation. You have room in your budget to put your valuable employees on projects drive the business forward—as opposed to filling their schedules with mundane tasks. This can lead to increased employee satisfaction, decreased turnover and higher levels of innovation. This helps your organization use technology to stand out from the competition and take advantage of new business opportunities.
2. Mitigate compliance and security risks, as business units are less likely to use shadow IT and connect risky apps to your network and store sensitive data in non-sanctioned locations.
3. Standardize your IT services to allow business units to get IT on demand. This helps them quickly respond to market changes and improve their productivity.
4. Integrate your IT services to lower your costs while improving performance.
5. Get the best price on third-party IT services. Because the market is so competitive, you can evaluate multiple providers to get the best services at the lowest prices. Furthermore, external providers may have purchasing leverage that you may not have.
6. Increase your value within your organization. Business units see you as a valuable consultant who helps them reach their goals and drive sales. IT should be easy to do business with, eliminating what used to be hard and mundane.
7. Improve time to value. Where applicable, become a secure and viable alternative to external providers that deliver real time provisioning of resources.
How to Align IT and the Business
Successful IT brokers blend technology and the business seamlessly. So how does one become a successful IT broker?
Here are seven steps to becoming one:
1. Understand where your business is today
Before you run towards the finish line, you should know your starting point. In IT, many employees are order takers. They take requests and build technologies. However, they don’t know the drivers behind these requests or how the technologies can help the business reach its goals. The right people that can translate business requirements to functionality quickly are essential.
Today’s IT executives should not only understand the technology but also advise business executives on how to use it to cross the finish line. Here are some questions to ask if you want to be seen as a valuable consultant, not just an order taker, you should ask yourself:
Do I understand my business and outcomes that should be achieved?
What new thinking can I bring to the table?
Can I mirror the business’ commitment to our customers?
Can I compete with external providers for cost and time to value?
2. Choose a delivery method
IT faces a catch-22: Deliver services at a moment’s notice while closely guarding your sensitive data. Employees expect on-demand cloud services and don’t want to wait for IT to provision them. They often bypass IT to quickly get what they need, putting your company’s data at risk.
The hybrid data center model gives you the flexibility to meet these demands while mitigating your cloud risks. According to analysts, up to 70 percent of organizations are pursuing the hybrid cloud by 2015. With a hybrid data center, you can support legacy applications, private clouds and SaaS applications. When you give your users options, they are less likely to turn to risky shadow IT.
3. Assemble your building blocks
IT services are like building blocks—they start as something modular and are built up and reassembled over time. When you provide IT consulting services, look at all your internal and external Lego blocks. Then, assemble them so they meet your business needs while keeping your data secure. The great thing about your team’s Lego blocks is that they can be re-assembled over time as your business and IT needs change
4. Create an integration plan
When you bring in new technologies, applications and data, you often need to run the old environments alongside them. You can end up with a huge mismatch that spans 20 to 40 years of IT development. Business units may benefit from a “subway map” visual that shows how all of your technologies are interconnected. You also need strong leaders to lead the projects and people through this change.
5. Budget for innovation
IT typically allocates the majority of its budget for day-to-day operations, leaving only a small percentage for innovation. This can cause business units to go outside of IT when they need technology that makes them more innovative or productive. Re-allocating your funds can help you put the focus on the business—allowing it move faster and be more competitive. When you help business units achieve their goals, they start seeing IT as a champion for their causes.
6. Budget for time and money for training and transition
This is as much a change management effort as it is a new business strategy
7. Assemble your team
Make sure to get a solid cross section of technologists and business resources. Get help if you haven’t successfully done it before or don’t have the internal resources available with the needed skills. You will need quick wins and a high probability of success to gain the trust of stakeholders that are sourcing IT services externally.
Now Is the Best Time to Rethink Your Role
As an IT executive, you have the resources to transform your organization. It’s time to rethink your role and the value that you’re providing. How does your IT organization align with the overall business strategy and roadmap? How can you help the business harness its competitive advantages and take advantage of new opportunities? How can you help your company take advantage of technology to drive the business forward?
Personal innovation and evolution are keys to success as an IT executive. Bringing value to clients, employees and the company will lead to increased responsibility and the rewards that accompany it.