Mastering the business of IT

IT departments have a history of spearheading new initiatives to support key business activity.

Organisations often need time to take full advantage of new technology – mobile devices and Internet of Things are two examples – but once they are integral to the enterprise, these new technologies become subject to the same competitive pressure as the business itself. There is an expectation that they will be kept up-to-date to continue to give the organisation a business advantage.

However, in the modern digital world, it’s now possible for an organisation to have no IT department at all, due to the changing way technology is developed and deployed. There is less support from in-house IT departments and more presence from external vendors, in part because of the growth of technology-as-a-service models.

The business of IT

Despite the changing needs of a modern business, many IT departments continue to focus on the 'nuts and bolts' of technology. Engineers and technologists running these departments continue to run IT in the same way as it has been for years, and if they are good at their jobs then they will be promoted to positions of IT management. But it’s important to remember that a great engineer is not necessarily a great businessperson.

So, despite the key role that business IT plays in driving forward the modern digital company, it has often been slow to integrate into core business operations and IT departments have not historically been run using strong business models. Some standards have been developed as guides for how certain aspects of business IT should be run. However, until now there has not been an overarching standard to help IT departments run smoothly and be managed holistically as a business unit.

Going beyond business as usual

Gone are the days when a software upgrade would take years to implement. Both business and IT have developed to such an extent that one of the main focuses is now on instant change and agility. As a result, IT departments are required to adopt a model to help them manage technology change more efficiently. Those that don’t will ultimately hold back the entire business from gaining a competitive advantage.

IT departments are aware of this, and are often on the leading edge of agile or lean processes within an organisation. However, agility for its own sake, or agility just within an IT development organisation may not result in the needed level of business agility. Imagine, for example, if an IT department spearheaded a data project, which resulted in something being put into production that customers were unable to adopt or, worse, were never interested in purchasing. While IT may have been agile in technology delivery, it could still be a business disaster not only for the IT team but also for the whole business.

A new IT business model is needed to enable the department to make more informed and better decisions for the business. And it is important that IT understands the company and its business goals if it is to help the company down the path to success. IT teams that are not in line with company strategy will not know what products will bring the best business benefits and will subsequently not invest in the right technologies. Not only that, this lack of insight may mean that IT teams end up spending money on fixing problems as opposed to innovating, which will not help in giving the company any competitive advantage.

Entering a new age of IT

The ideas outlined above have become such key issues for IT teams across the globe that leading industry figures have recently come together to address the issue in a consortium looking into business IT. These organisations, which spend billions each year on IT, understand the issue at hand and want to ensure any investment they make is done so with the long-term plan for the business in mind.

David Lounsbury, CTO, The Open Group

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