IT is dead. Long live IT!

  • Posted on July 18, 2016

new economics of IT graphic

This is a guest blog post written by Avanade alum, Scott Lewis. 

There has been a lot written about the coming demise of IT over past several years. But is IT really on the same path to extinction as the dinosaurs? I say not so fast. Some of my colleagues have written recently on the concept of the New Economics of IT and the perfect storm IT leaders find themselves facing. The perfect storm consisting of a combination of unprecedented levels of technology disruption from the likes of IoT, smart devices, conductive agents to name a few and the ever increasing expectation of digital savvy board members, executives, staff, partner and customers.

Yes IT leaders do in fact find themselves in a very interesting and somewhat perplexing situation. C-level executives want to move their businesses rapidly in the direction of “digital business”. They are expecting IT to help provide this digital innovation. The issues facing IT leaders have left many are scrambling to find the skilled people to deal with these new technology changes. To make matters worse IT budgets are barely increasing, if at all. IT leaders are going to have to determine how to repurpose not only existing cash budgets but also people resources to ensure they can respond to the perfect storm in order to help the business innovate in today’s cloud-first, digital world.

In order to succeed we strongly believe IT needs to take a new dual approach. What we are talking about here is NOT an “us” versus “them” approach. This is an IT organization working in unison to optimize core IT systems to keep today’s business running predictably while also exploring new technologies to help the business innovate. I want to stress the concept of “working in unison” here.  The diagram below shows the continuum of “predictability” and “exploratory”. There is no break in the arrow, it’s intentionally illustrated as a ribbon to show that although IT is being pulled in two directions the IT organization must operate across the spectrum of “keeping the lights on” and “innovating for the future”.

New Econ of IT Graphic

By using these new approaches, IT can overcome the issues that are preventing them from adding value to the business. Resolving these issues are inter-related, not isolated, goals. For example, by maximizing efficiency and increasing agility, the enterprise can leverage its savings in budget and personnel to invest in higher levels of innovation.

Creating a new economics of efficiency reduces the cost of IT to the business. Here we are talking about optimizing core capabilities to efficiently manage, maintain and secure core IT systems using predictable approaches that industrialize and standardize IT. The technologies and methodologies that contribute to this goal range from cloud, software-as-a-service and hybrid IT to managed services, service management and change management.

Creating a new economics of agility accelerates the capability of IT. Agility is the “glue” between predictable and exploratory. Modernize business systems to fully exploit the speed, scale and efficiency of the cloud. This is equally important whether the target is optimizing the core or innovating the business. The technologies and methodologies that contribute to this goal include DevOps and Agile, the cloud and portals, liquid applications, automation, orchestration, and change enablement.

Creating a new economics of innovation help you identify new opportunities. Look to innovate the business by capitalizing on digital technologies that create market differentiation through innovation using exploratory approaches. Key technologies and methodologies relevant to speeding innovation, including robotics, cognitive computing, cloud APIs and hybrid cloud, liquid apps, the Internet of Things, Kanban and scrum.

Over the next several weeks we will take a look at the results enterprises have achieved by creating a new economics of IT in the areas of efficiency, agility and innovation.

IT is not dead. We now have a New Economics of IT to succeed in today’s cloud-first, digital world.

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