For a while, there had been predictions of the death of the internal IT department. Wrong! There had also been predictions about the death of the IT Manager and CIO. Wrong!
What is just occurring, in my view, is a fantastic shift, a shift from being a support function and a cost centre to a new function that can increase the company productivity and therefore profitability.
The shift is clear and evident. I can see it on my talks with many CIOs on a daily basis. Another element of this shift is that now IT is driving some business and industry changes and disrupting the way that complete industry sectors work. Some clear examples of this phenomenon is the impact on the retail sector by online shopping, the impact on the publishing and media sectors by web and mobile access and the impact on marketing and promotion by online marketing. Some of the most dramatic industry changes produced by these new and disruptive technologies are the changes in Fairfax and News Corporation.
The huge growth of IT service providers, infrastructure cloud offering and software as a service solutions have meant that now CIOs can really focus on improving a corporation’s productivity by utilising the best available IT, not by managing IT staff who’s skills become obsolete very quickly and therefore are in constant need of retraining.
New CIOs are those who are managing the fantastic shift. Those who have identified the vendors to partner with, who will provide him/her with the solutions needed, on the cloud, fast and efficiently.
Who today buys and installs an in-house email spam filtering system? You have got to be kidding! No one. Today, you just go and buy the service from a number of available SaaS providers who have mastered this solution. If you feel the solution becoming expensive, you change it. If you feel the solution has become ineffective and there is a better one in the market, you change it again.
Furthermore, who today considers building or installing an in-house document management system or a CRM solution? These are a small sample of solutions readily available and widely used as a service.
Who today considers having an internal team of software developers, when they are readily available from IT services firms?
Who today won’t consider hosting your datacentre at a hosting company, or going further – who today won’t consider the public cloud offerings to host some or most of your apps?
Who today doesn’t use Gmail, Dropbox, Web Apps, iPad Apps, iPhone Apps, and Android apps to name a few?
So, as Mark Twain once said “the report of my death was an exaggeration”, the death of the IT department and CIO was just that, an exaggeration. Instead, the roles have changed and shifted to a strategic one, where vendors and solutions are managed, policies and procedures are established and policed and most importantly, where a focus on productivity has taken first place.
The IT department and its CIO are shifting to a complex role of managing a plethora of vendors and complex solutions provided best by the market and establishing fast, efficient and effective relationships with business and providers.
Your IT department can no longer have technical people who have been in their roles for 10, 20 or more years. You need to replace them with vendor provided skills. They are hindering your productivity (your department and your company’s). They are always too busy and hold skills that are obsolete most of time. Your vendors have people with recent skills, certifications and a broad range of experiences at many companies. Technical roles are now indistinguishable between companies. Most of them perform routine maintenance roles that can be better provided by vendors.
What you need are KRM (Key Relationship Managers), Business Analysts and (sometimes) Project Managers. They must understand the business, your products and core offering. They must be expert vendor managers (able to build strong relationships with vendors not through ‘Procurement’ because they do not understand complex technical offerings) and able to understand how changes in technology affect the business.
These managers need to be able to implement solutions suitable to their business, fast, efficiently and with the main objective of improving the company’s productivity.
As the Nobel Prize-winning economist Paul Krugman said, Productivity isn’t everything, but in the long run it’s nearly everything