The Evolution of Enterprise IT

How Systems of Engagement will enable Collaborative IT to trump Shadow IT

One doesn’t have to look very far or very hard to see overwhelming evidence that key support functions ( eg: Marketing, Finance & HR ) and line of business users in major companies are bypassing the corporate IT group and going directly to outside technology vendors to purchase hardware and software resources.

• Gartner predicts that in less than 3 years, 35% of all enterprise IT expenditures will happen outside the corporate IT budget
• PricewaterhouseCoopers’ recent Digital IQ Survey results showed that at the 100 companies PwC ranks as “top performers,” IT controls less than 50% of the corporate technology expenditures

This rise of what is called “Shadow IT” is driven by the age old lament that “corporate IT takes too long, costs too much and never gives me what I really want.” It has received a recent boost by the emergence of software-as-a-service that allows for easy to deploy and configure applications to be installed virtually overnight.

Another forcing function to this more “direct approach” is the BYOD movement, which includes devices and collaboration tools that employees are using to enable faster and more effective communication, coordination and collaboration both within the organization and with customers, supply chain partners and other key constituents.

So some of you reading this may be saying “so what” this just seems like a better way for companies to leverage these new resources and tools to their competitive benefit. While there is a case to be made for that point of view, I think there’s a more compelling case to be made as to why this go it alone approach can result in serious consequences for the companies that allow it to spread throughout their organization.

• The unsupervised growth of new apps and technology tools can significantly increase IT costs, infrastructure complexity and governance issues
• CIOs are now confronted with how to incorporate these disparate resources into the company’s enterprise IT systems and platforms to enable secure and stable interfaces between systems of engagement and systems of record
• Thus far, there is no comprehensive IT architecture model around which to plan how to design and deploy these new technology resources and tools
• There is a lack of repeatable decision making processes and vocabulary to enable companies to make thoughtful cost/value IT expenditure trade off decisions

The Challenge for the IT Team

Enterprise IT teams are now challenged with how to build a stable and secure bridge between systems of engagement operating at the edge of the company with systems of record operating the core of the company. Allowing unfettered growth of multiple new SOES without figuring out how they can interact with SORS, will suboptimize their value in creating a strong and enduring customer engagement experience.

Introducing the Era of Collaborative IT

Instead of trying to stop or mitigate Shadow IT, I think there is an opportunity for CIOs and their senior leadership teams to introduce a new era of collaborative IT that involves the following:

This collaborative approach is designed to get all the key stakeholders at the table to talk about how to better align technology investment priorities with the critical business outcomes.

1. How to use moments of customer engagement as a means of prioritizing future investments in systems of engagement
2. How technology enabled innovation and tools can play a more direct role in generating new revenue and profits for the business
3. How to work through a thoughtful cost/value set of trade offs
4. How to ensure that the new SOEs can gain access to data and information stored in SORs in a secure and stable manner

By starting together and building a joint technology development roadmap, corporate IT and their business partners/users can collaborate to expedite solutions that maximize the ROI and competitive benefits of these critical investments.

A recent finding from IBM’s Institute for Business Value study with CIO’s and CMO’s re-enforces the scope and value of the collaborative IT model:

Key Study Finding:

“While Marketing has always been responsible for knowing the customer, now they are required to understand and respond to customers as individuals. Marketing can only do this if they can manage vast amounts of unstructured data, make sense of it with analytics, and generate insights that are predictive, not just historical – all on a massive scale.

To connect with individual customers at every touch point effectively, they need a system of engagement that maximizes value with each interaction. And they need each touch point to marry the culture of the organization with the brand to create authentic experiences that consistently deliver the brand promise. The way to achieve this unprecedented transformation is through technology.”

While many companies are putting an increased emphasis on using technology to help deliver increased competitive advantage, if this process is not carried out in a thoughtful and collaborative way I think it can cause more problems than benefits.

What do you think?