Taking place this week is one of the best IT Service Management conferences in the world; Pink11 Gathered in the Belaggio Hotel in Las Vegas are some of the best and brightest minds in the industry sharing their thoughts, theories, suggestions, etc. For those readers who have followed me for a while now are familiar with my take on IT Service Management and using “change” as a competitive weapon. I was so impressed by the opening remarks and especially the opening video that I had to tweak an old post I did and put it back up here. Make sure you watch the video first and then watch the open remarks.
I’ve stated many times that, change presents opportunities. The ability to adapt to change is a key advantage in business. To survive, compete, and win, enterprises must adapt. However, because change is often disruptive and expensive, few organizations are prepared to take advantage consistently of the opportunities that change presents.
The IT organization, in particular, is sometimes often seen as a roadblock to business agility. This is somewhat ironic because new information technology should be a key part of the solution. But IT innovation causes so much change, that it is difficult to reap the benefits of this innovation. Accordingly, CIOs have often paid close attention to cost, quality, and risk management concerns. Because of the complexity of the business environment and underlying technologies, the desired end state was typically stability of operations, with changes managed as initiatives delivering new functionality while ensuring ongoing stability and controlling costs.
The situation we find ourselves in today is that IT is still sometimes an inhibitor of the business (in some respects) and we need to get the business and IT organizations to not merely align their efforts but to converge and synchronize them to reap the rewards of being flexible, responsive, and proactive.
One of the key challenges I see, and I’m sure the rest of you see, is that there are silos of applications and information. For instance, a customer of mine wanted to roll out a new app. It needed to go through five different “silos” to get to the end users. I was in the meeting with them along with the server team, network team, security team, systems mgmt team, and finally the desktop team. All of these “silos” had concerns:
- the server team was worried about power and datacenter space
- the network team was worried about bandwidth and trafffic
- the security team was worried about all the risks and vulnerabilities
- the systems mgmt team was worried about trying to make it all fit together
- finally, the desktop team who has to support all the end users
These guys were lucky to get any application project out in less than nine months. One of the risks with these silos was that the business requirements changed three times by the time they could get it rolled out. This is not acceptable today and the reason this happens is because of the obsolete nature of today’s IT business model.
Another dilemma here is what C.K. Prahalad and M.S. Krishnan referred to their book, The New Age of Innovation, as the “line of business and CIO disconnect”, because it involves a chasm between what the line of business managers want to accomplish and what CIOs perceive their jobs to be – and how they are perceived. Most CIOs that I have spoken to are still thought of as operating in a technology silo concerned primarily with “internal efficiency” and this is a seriously limiting factor. “It’s not surprising that the CIO focus is on maintenance of existing systems and not business innovation.”
So why aren’t CIOs devoting the required time and effort to innovation in IT? The truth is that most do, and in other cases it’s something that isn’t really generally expected of them. Overall, CIOs have a very difficult balancing act as seen by this graphic:
Over the years I’ve talked with numerous CEOs and CIOs and they pretty much tell me the same things. They want to:
* maximize the return on their investments
* manage and mitigate risk
* need improve their IT performance
* and finally they want more agility
Basically the net here is they want to be able to handle and take advantage of change today to improve their competitiveness, lower costs, and serve their customers better — and build an IT environment and business processes that can easily accommodate tomorrow’s changes. How? In today’s perilous economic times IT budgets are growing but not by much. CIOs are having a tough time with changes happening continuously, more of the budget is going to maintenance and integration tasks, with little left over for innovation; but it’s not time to retrench. I’ve stated before that retrenchment will surely buy you time, but it will not buy you opportunity, growth or a future.
The old business model of IT is dead. It’s time to “rearchitect” the business model to get in the game. If not, then get out of the way.