IT Organization Circa 2017 – 5 Year Countdown (Part 2)


countdownIn Part 1 of this post I pointed out why I’d named this blog “IT Organization Circa 2017″ and why I’d picked 2017. I then offered some musings about the nature and shape of the IT Organization Circa 2017.

I set this up by examining the major disruptive forces acting on the IT organization today:

The bottom line is that many IT organizations are at risk of being disintermediated – victims of the inextricable forces mentioned above.

“You cost too much and add too little value!”

is the familiar cry – but one that is more about the IT organization than it is about information technology.

The End of the IT Organization?

My view of the next five years is that in extreme cases, the IT organization as we know it will be gone – supplanted by a constantly shifting landscape of outsource providers, consultants, cloud solutions and “shadow quasi-IT groups” embedded in business units and taking care of local business needs. I can safely predict this because it’s already happened. In fact, when I started my IT career in 1970, working for International Computers Limited, (ICL) one of our major national accounts was British retailer Marks & Spencer. At that time, Marks & Spencer had no computers or IT department, even though they were highly computerized. Founder Michael Marks believed the firm should stick to what it knew – retailing – and hire experts to do the things it needed but did not know how to do. Consistent with that philosophy, ICL ran all Marks and Spencer’s computing. Nowadays, we call that “core competence.” As an aside, contrast that with another great British retailer and food manufacturer, J. Lyons & Co. who in the early 1950s had developed their own computer, the LEO, which eventually became part of my employer, ICL!

Already today, many companies around the globe have slashed the size of their IT organizations – some by 80-90%, taking advantage of global sourcing options and shifting the headache of running an IT shop to one or more outsourcing partners. There has, of course, been some backlash, and a small proportion of these outsourced IT shops bring their work back in house. In some cases, this is part of a long term strategy – pass your IT capabilities over to an outsourcer (or several) for a few years to have them “fix it” then bring those capabilities back in house. But even with the ebb and flow of the outsourcing movement, the trend is clear.  As companies become more networked and try to become more agile, they are less inclined to sustain large internal IT groups.

Similarly, the value proposition for cloud computing and the rapidly growing base of ‘software as a service’ is just too compelling, and the general satisfaction with internal IT capabilities too underwhelming. Why make huge capital investments in core systems, and carry the depreciation, maintenance and operational costs when I can ‘rent’ these and ‘pay by the drink’? Just as application packages have tended to supplant custom software development, software as a service is tending to supplant applications packages. As more computing moves to mobile, costly application packages become relatively inexpensive (or at least, value priced) “apps.” And the key issue with emerging computing models such as cloud and mobile is that they do not necessarily depend upon a permanent, in-house IT department.

The Ebb and Flow of Centralization and Decentralization

Organizational models tend to go through cycles of centralization and decentralization. There is always a tension inherent in finding the proper balance between the efficiency and scale of centralized, shared capability models and the responsiveness and customer-intimacy of decentralized models. This tension is never resolved – it is simply held in some sort of uncomfortable balance until the forces on one side outweigh the forces on the other side. This imbalance is often triggered by changing market conditions or by other disruptive forces such as new technologies.

The Mainframe Era – Centralization Rides High!

We’ve seen this through many cycles of technology shifts and their impact on IT organizational models. Back in the early days of the mainframe computer (early 1960s) virtually all IT professionals either worked for vendors/solution providers or worked in a centralized IT group.  (Back then it was typically called Data Processing.)

The Minicomputer Era – Departmental Computing Catches On!

With the advent of the minicomputer in the mid-1960′s, so-called “department computing” came of age, sometimes with the blessing of central IT groups, but often behind their backs.

Enter the Personal Computer – Departmental Computing Evolves into Decentralization of IT

As minicomputers gave way to personal computers and with IBM‘s launch of the IBM PC in the early 1980′s, the genie was further out of the bottle and the swing to what was euphemistically referred to as “distributed computing” was all but unstoppable. IT was becoming decentralized!

Inevitably, cracks in the distributed computing wall quickly appeared as users tackled issues such as mainframe connectivity and enterprise data management, and wrestled with the practical realities of back-up, security, integrity and privacy.

The Realities and Complexity of Enterprise Computing Surface – Centralization of IT Makes a Comeback – Sort Of!

By the early 1990′s the pendulum had begun to swing back to centralization. It seemed on the face of it that the old guard of the central IT group had returned in force.  But look under the covers, and what you see is not simply a return to the monolithic central IT group.  The new IT operating models had novel features such as:

  • Business-IT governance boards that moved ownership of prioritization and, in the best cases, value realization out to the business.
  • Business relationship managers bridging between the IT organization and business groups.
  • Business and Enterprise Architects focused on Business Operating Models and process management.
  • Sourcing and Vendor Management Groups.
  • Security and Privacy Groups reporting to senior business executives, embracing IT but not limited to it.

In other words, the centralized IT model of the early 1960′s had given way to a hybrid model that sought a more even-handed balance between local and global computing models. With the ascendance of cloud and mobile computing and the rise of global sourcing, I believe we are on our way to a new generation of computing model.

The Emerging IT Operating Model

I think it’s important to think of an IT Operating Model as an enterprise-wide construct – i.e., an IT organization is but one component. Many more IT functions are being distributed and dispersed – witness the so-called rise of Bring Your Own Device (BYOD). Here, functions that were performed by a central IT group are being performed by the business individual.  And this move towards ‘self-service’ and ‘business embedded’ functions will only expand with emerging technology. As such, we can think about IT Operating Model components as comprising centralized, decentralized and hybrid components. These might fall along the following lines:

Centralized Capabilities: Shared IT Services; Value Proposition = Standardization, Operational Excellence

  • Enterprise Architecture
  • Enterprise Shared Infrastructure
  • Enterprise Shared Solutions
  • Security and Privacy
  • Sourcing and Vendor Management

Decentralized Capabilities: Business-dedicated IT Services; Value Proposition = Customer Intimacy, Innovation)

  • Business Architecture
  • Local and Departmental Solutions
  • Business Analytics

Hybrid Capabilities: Networked IT Services, Communities of Practice; Value Proposition = Integration, Shared Learning

  • Business-IT governance/value realization boards
  • Innovation Centers
  • Organizational Development and Change Leadership Centers
  • Business Relationship and Sourcing Management
  • Data Visualization
  • Integration
  • Process Management

Why This Is Good News for the IT Profession

I will explore some of the implications of this shift for the IT profession in a future post, but by and large, given the many ways that I’ve seen IT professionals trapped in the past by their employers, I’d say the changes we are experiencing, while painful, will be beneficial at many levels.

 

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countdown5 IT Organization Circa 2017 – 5-Year-Countdown – Part 1

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Free Webinar: The Changing Business Relationship Management Role: Past, Present and Future


iStock_000008462699SmallWhat is a Business Relationship Manager?

The BRM is a crucial role that bridges a business partner with an internal provider. The role evolved from both the Customer Relationship Management discipline that focuses on all aspects of an organization’s customer interactions, and the Service Management discipline, designed to optimize complex service-intensive supply chains. The BRM role has been embraced by the IT Infrastructure Library (ITIL®) and the ISO/IEC 20000 standard for IT Service Management as a new best practice and an international Service Management standard requirement. The most common BRM represents an IT organization, but BRMs can also serve internal HR, Finance, Legal and other shared services functions.

Rooted in, but Not Constrained to Customer Relationship Management and Service Management

While its relationships with Customer Relationship and IT Service Management are important aspects of the BRM role, especially as it is commonly described today, the nature of the BRM role and its capacity to identify and help realize strategic opportunities goes well beyond these realms.

So, How Is the BRM Role Evolving?

Through Business Relationship Management Institute, I will be presenting a Free 60-minute webinar that will explore how the BRM Role is evolving and how it is becoming a vital strategic enabler. I will be covering the following topics:

  • The Emergence of the BRM Role
    • Explores the forces that led to today’s rapidly growing BRM professional community and the common variations in role scope and positioning.
  • Current State of the BRM Practice
    • Examines the typical responsibilities for the BRM role and how these are changing with business demand and provider supply maturity.
  • BRM Futures
    • Presents the latest thinking and research about how the BRM role is evolving and what this means to today’s BRM professional.

Webinar Logistics

The one-hour free webinar will be held on Thursday, August 1, 2013 at 10am EDT, and repeated on Monday August 5, 2013 at 7pm EDT.  It will be delivered via Citrix GoToWebinar.  All that is required is a computer with a browser and a high speed Internet connection, with either a telephone, or a microphone and speakers or a headset.

To register for the Thursday, August 1 session at 10am EDT, please click here.  (Webinar ID: 117-570-139).

To register for the Monday, August 5 session at 7apm EDT, please click here.  (Webinar ID: 117-661-379)

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Announcing the Inaugural Certified Business Relationship Manager® Training


Training and DevelopmentI am very pleased to announce that Business Relationship Management Institute will be holding our first Certified Business Relationship Manager® (CBRM®) course in Atlanta, GA, USA on July 22-24, 2013. CBRM® certification exams will be available online from August 26, 2013.  I will be teaching this inaugural CBRM® course.

CBRM® training and certification program is intended for the intermediate to advanced Business Relationship Manager. This will typically be someone who has at least two years of experience in a BRM role or similar position or at least one year in a BRM leadership role.

The course fee is $2,500.00 per person and includes all course materials (BRMI members receive 10% discount). Travel, hotel accommodations, and evening meals are not included. The course will be limited to 15 participants to facilitate an optimum learning environment. Space is very limited. Please register today to reserve your seat by emailing or calling us at +1.888.848.3012.

Please note that the July 22-24 course was originally intended to be a fully interactive online program, but, based on the feedback we received from prospective attendees, it will be offered first as an onsite class. The first fully interactive online CBRM® course will now be held over a 3-week period, on September 9, September 16, and September 23, 2013.

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When Everything Becomes a Service – Does ITIL Help or Hurt?


services-13For many years I’ve had an interest in the disciplines of Product Management and Service Management. These disciplines have been generally lacking in IT shops, though that is changing. Frameworks such as ITIL and standards such as ISO/IEC 20000 are helping sensitize IT professionals to Service Management, and methods such as Agile Development and Scrum are sensitizing IT professionals to the role of Product Owner, if not to the disciplines of Product Management.

However, my interest has been strengthened since reading the remarkable book, The Connected Company by Dave Gray with Thomas Vander Wal. Dave and Thomas have awakened me to a fact that I was subliminally aware of, but have reinforced for me why this is happening now. They have also drawn out for me some implications and subtleties I had not considered when thinking about the Service Revolution.

Everything is Becoming a Service

As the authors suggest:

Services cannot be designed and manufactured in isolation, like products. They are co-created with customers and are interdependent with wider service networks and clusters.”

They point out that most companies today have been finely tuned to “produce high volumes of consistent, standard outputs, with great efficiency and low cost.” Even some so-called ‘services’ are in reality “factory-style processes that treat people as if they were products moving through a production line.”

The Customer’s Experience of a Service is Key!

A product is largely experienced as it was manufactured. We may have subjective reactions to the product, but it does not change, other than through built in features. Services, however, change as they are experienced. This means that services cannot be delivered simply through efficient and operationally excellent processes. Services demand a ‘customer intimate’ delivery model that adapts to the ways the service is co-created by the customer and optimizes the customer experience.

The Strengths and Weaknesses of Standards and Frameworks Such as ITIL

My esteemed colleague at BRM Institute, Dr. Aleksandr Zhuk, just posted a wonderful short post titled “BRM Role and Service: ITIL Dyad Revisited.” As an officially certified ITIL Expert, ‘he knows what of he speaks’, as they say. Please check out his post – and tell us both what you think, and how these observations resonate with your own experiences.

 

Graphic courtesy of Augustedge

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IT Organization Circa 2017 – 5 Year Countdown (Part 1)


countdown5When I launched this blog on September 21, 2007, my opening post declared:

I’ve named this blog “IT Organization Circa 2017″ in an attempt to position the domain of interest – what will the IT Organization inside businesses, governments and other organized entities look like in 10 years (2017) and how did they get there?”

I went on to explain that I’d picked 2017 as it was 10 years from my first post – a time-frame that seemed to allow a high degree of change, but that I would (statistically, and hopefully) be around to see.

So, with 5 years to go, here are some musings on IT Organization Circa 2017, with thanks to my co-founders at Business Relationship Management Institute, Aaron Barnes and Dr. Aleksandr Zhuk with whom I’ve been noodling on the subject.

To set this up, we need to consider the major disruptive forces acting on the IT organization today:

Let’s take each of these disruptive forces and delve into them.

IT Organizational Disappointment

There’s a general (though not universal) sense of disappointment with IT! We used to hear, “It costs too much and delivers too little value!” Nowadays, we are more likely to hear, “It takes too long!” When the competitive landscape can change almost overnight and when technology creates opportunities to reinvent products, services and business models just as quickly, it usually seems to be the IT organization that’s the bottleneck. Typically,

  1. It takes the IT organization time to examine a need or opportunity.
  2. It often feels to the business executive that the examination of a given need or opportunity is an exercise in bureaucracy – too many hoops and hurdles to go through with few of them, if any, adding value.
  3. If the request does make it through the hurdles before the need has gone away, there’s often a lengthy ‘waiting period’ while resources are freed up – the dreaded so-called ‘backlog’.
  4. Sometimes the original simple request somehow morphs into a major deal, as other business needs are piled on, and legacy issues rear their ugly heads.

To get beyond these clichéd perceptions, some IT organizations are now on their 3rd or 4th ‘transformation’ comprising activities such as retooling, re-skilling, reorganizing, leaning out processes, and adopting standards frameworks such as ITIL and COBIT. While these efforts may well be necessary, many are not cleanly executed, taking 2-3 years to bring benefits, and in the meantime creating more disruption for the business customer.

So, it hurts me to say it, and many of my readers may resent it, but the truth is that more often than not, IT organizations are seen as barriers to business progress with information and IT, rather than the enablers they would like to see.

Cloud Computing

Despite some well-publicized snafus, Cloud Computing is making significant inroads just about everywhere. Sometimes, the shift to the cloud is around very small services – document sharing, or storage of large files such as videos, and so on. Other times, the shift is broad based and significant – moving supply chain or customer relationship management processes to the cloud, for example. Either way, the cloud offers an easy way to try something without a significant capital investment or running through the corporate maze of product and vendor certifications and contracting. And, at least in theory, if not in practice, cloud solutions feel to non-IT people as something they understand and can procure and deploy without IT assistance. In fact, it’s often something they are already using at home with great success. This represents a huge ‘bypass’ to the traditional IT organization.

Many companies today are catching on to “big data” and the power of analytics applied to vast sources of data, such as sentiment analysis of social media or identification of consumer purchasing patterns based upon correlations that had not been previously recognized. Big data often requires massively parallel software running on tens, hundreds, or even thousands of servers – something that is beyond the limits of most corporate data centers, but achievable through Cloud Computing – creating yet another entry point that can bypass the IT organization.

Add the attractiveness of the Cloud Computing value proposition and perceived ease of doing business to the sense of IT organizational disappointment mentioned about, and you have an interesting recipe for a revolution!

Consumerization of IT

This, with its sister movement towards mobile everything is a powerful disruptive force! People are increasingly able to chose their own devices – smart phones, laptop computers, tablet computers, and so on. These devices come with a vast available library of ‘Apps’ to do just about anything you might need. And if you need something for your business that does not yet exist, there’s a universe of willing, inexpensive developers out there who’d be delighted to develop the App for you and your business!

This trend is not going away – to the contrary is is the beginning of a new sense of empowerment – everyone is their own IT department. It’s probably wrong to call this a “slippery slope” which implies a falling down at some point, but it certainly marks a shift in the relationship between business people and their technology – a shift in which the IT professional may have moved from a faceless body in the corporate IT department to a slick, service-oriented professional in the local phone store. (Reality note here – my daughter’s phone stopped working last week and she revealed to me her loathing of having to visit the phone store! She said, “The phone store has become the modern day equivalent of the automobile dealership!”)

Global Sourcing

While not a panacea, and while many companies experience a painful transition to various flavors of outsourcing, most companies have tried it at some level, and plan to do more of it! For all its challenges, a well-executed global sourcing arrangement (or set of arrangements) can help an IT organization flex with changing business demand – both in terms of capacity (the ability to handle more or fewer projects as demand dictates) and capability – the ability to take on work for which the inhouse resources may not have the necessary skills or experience.

Who Is Engaging these Alternate Sources?

Increasingly, these alternate sources (namely, Cloud Computing, Global Sourcing, Consumer IT, Apps) are being engaged directly by the business with minimal to no reference to the IT organization.

So, What’s Does the IT Organization Look Like Circa 2017

I’ll leave you all to ponder on these disruptive forces for a week or so, and then I’ll provide my take on the future of the IT organization. Meanwhile, comments appreciated and encouraged!

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Expanding Our BRM Webinar Series


universe_expanding_astronomer_230405

Since Business Relationship Management Institute membership and webinar enrollment began last week, many of our new Founding Members signed up for our BRM Training Webinar Series of events.

Always eager to learn and improve their Business Relationship Management skills, several BRMI members reached out to us requesting that we expand our once-a-month series of three identical webinars, which was originally designed to provide a periodic introduction to the BRM role, to cover three different topics. We listened. Now, it is BRMI’s pleasure to introduce the updated and expanded BRM Training Webinar Series, which now covers three different topics:

  1. “Introduction to the BRM Role”—April 26, 2013, 12:00PM-1:00PM, EST
  2. “Challenges and Implications of the BRM Role”—May 17, 2013, 12:00PM-1:00PM EST
  3. “The BRM Role and Organizational Clarity”—June 14, 2013, 9:00AM-10:00AM EST

Outlines of these webinars are available on the BRMI Events page.

All BRMI webinars are free for BRMI members or $95 for non-members.

Shortly after each webinar, a recording of the event will be available for download. BRMI members will be able to download the recordings at no charge from Webinar Recordings Archive accessible from their members-only myBRMI page. Non-members will be able to purchase the recording for $65 each. Please feel free to contact BRMI with any questions.

I am looking forward to meeting you at the webinar! Thank you very much for your support!

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Business Relationship Managers Now Have a Place to Call Home!


Place to call homeOn March 15, we announced the formation of the Business Relationship Management Institute, a not-for-profit association for Business Relationship Management Professionals or Business Analysts who are on a career path to the BRM role. BRMI will be providing professional training and certification and facilitating exchange of knowledge and leading practices.

I’m very pleased to say that as of today our doors are fully open for business! We actually had a ‘soft opening’ earlier in the week and were astounded with the response—people from all over the world began signing up either for memberships or for the first in a series of webinars that we kick-off on April 26.

The BRMI Mission

To define, inspire, value, and promote the key traits of effective Business Relationship Management.”

To fulfill this mission, BRMI will:

  1. Gather and disseminate information on leading BRM practices–the BRM Interactive Body of Knowledge™.
  2. Provide a framework for active and aspiring BRMs to share experiences and exchange ideas.
  3. Establish and facilitate BRM education, professional training and certification programs.
  4. Facilitate networking among BRMs to support their professional growth and enhance their career opportunities.
  5. Provide opportunities for members to participate in the promotion of the BRM profession.

About BRMI Membership

BRMI members participate in the development and promotion of the Business Relationship Management role and profession and have access to a Wiki and collaboration platform featuring the BRM Interactive Body of Knowledge™. Members can volunteer their time and expertise for the good of the BRM professional community while expanding their knowledge and influence among peers.  Members are also able to attend all BRMI webinars at no additional cost and receive 10% discount on all training and certification products BRMI offers.

Please review this link for membership benefits and to sign-up.

Additionally, we’ll be hosting a series of monthly 1-hour Webinars about the BRM role and how to be successful in connecting provider organizations with their business partners. For information about the Webinars, or to register, please click here.

A Rapidly Growing Profession

As co-founders of BRMI who had formerly been co-moderators of the Professional Business Relationship Managers group on LinkedIn, we were keenly aware of the rapid emergence of this role and profession and the need for a professional body with a trusted source of information and training. Based upon our first few days of activity, we were correct in recognizing the need!

Let’s Hear Your ‘Voice of the Customer’

We are embarking on a series of interviews with BRMs to hear the “voice of the customer.” If you like to talk to us, please let us know. Or leave a comment below.

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