itSMF Fusion Keynote: Preparing for Industrialization of IT

Ann All

When Nicholas Carr published an article titled "IT Doesn't Matter" in the Harvard Business Review in 2003 and further expounded on his ideas in a book with the same title, he made lots of technologists mad. His basic argument is that IT is "essential to competitiveness but inconsequential to strategic advantage" and thus "best viewed (and managed) as a commodity."

 

Seven years later, the idea still gets some technologists pretty riled up, especially with smart folks like Forrester Research VP and principal analyst James Staten telling them a growing number of functions in IT are becoming commodities.

 

Staten opened his keynote address at this week's itSMF Fusion conference in Louisville, Ky., by sharing snippets of a Forrester survey that illustrate the often-unfavorable opinions of IT held by chief marketing officers. They see IT as "the department of no," said Staten, and "it's hard to shed that label."

 

But it is possible. Forrester suggests smart IT organizations can win the respect of CMOs and other business executives by transforming themselves into the "department of yes" with a three-part strategy:

  • Employ "strategic rightsourcing" strategies.
  • "Industrialize IT" by automating as many IT services as possible.
  • Use agile methods borrowed from application developers to create a more flexible infrastructure.

 

IT organizations shouldn't confuse rightsourcing with more traditional outsourcing, said Staten. "It's not about handing over the keys to your data center to somebody else and hoping they make it more efficient." Instead organizations must "hollow out" IT by looking at their overall portfolio and making three lists: functions that are commodities today, those that will become commodities, and strategic functions that should be run internally. Strategic functions "have a direct tie to the profitability of the business," Staten said, while "everything else is a commodity or a candidate for future commoditization."


 

The temptation with this exercise is to look at it in the context of saving money. (And that's something the business is always asking IT to do.) While it might ultimately result in cutting costs, that's not the main objective, Staten said. Rather it's about "freeing the bodies, the time and the mental capacity to figure out what the business wants and how IT can help them achieve it."

 

Rightsourcing is also more likely than traditional outsourcing to involve multiple service providers. Look for best-of-breed, but try to keep the number of suppliers manageable. It's easier to deal with six suppliers than with 16. Look for services that can integrated and linked to other services via APIs (application programming interfaces) and combined in a consistent fashion on the front end, advised Staten. Use a service catalog and/or portal to effectively provision services.

 

If IT is more of an art than a science now, it's headed down the path to become more like an industry. Staten suggested "pumping up predictability" with automation would greatly speed up business processes. "Anything repeated can be automated," he said. Boeing offers a good example of this, with its highly engineered and automated method of producing planes. "If Boeing engineered its systems the way most IT shops do, I'd take the train," Staten said.

 

Staten acknowledged automation creates worries over losing jobs. But, he said, the industrialization of IT is already happening. And, he added, "Those who keep an entire system running, not individual components of a system, are the ones who add real value to an organization."

 

Using agile methods will help IT organizations standardize their services, Staten said. Among the practices followed by agile developers: They start with a clean slate, build applications using reusable code and take an iterative approach to address problems during the development process rather than waiting until an app is finished. Similarly, said Staten, IT should strive to create an infrastructure in which as many elements as possible can be easily moved and reassembled. (He used a slide of Legos to illustrate this.)

 

Rather than working around legacy technologies, start with a clean slate, suggested Staten. Ask business users what they want and then ask yourselves, "Could I achieve this with Amazon EC2 or Google Apps" or other reusable components. Get Version 1.0 out as fast as you can, and don't be afraid to do a lot of tweaking. Business users would rather see quick results that require modification than wait a long time for perfection.

 

This is anathema to many IT professionals, who are "afraid of not building it right the first time," said Staten. But "business feels the need to move fast, so they are OK" with requiring several iterations to reach a desired end state.

 

Staten wrapped by noting there are "plenty of reasons" some IT professionals may not want to go down this path, with worries over job security a big one. But, he warned, there is a strong "technology populism" trend in which business users expect to take a more active role in creating technology strategies. IT organizations that don't allow this are at risk of becoming marginalized at best and obsolete at worst.



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