Tuesday, August 14, 2012

Radical IT Transformation

The industry has reached a consensus: IT is in trouble and is in need of a transformation. This much seems clear. But exactly what that transformation should look like is much less clear.

HP and Cisco tells us that IT transformation is about the cloud (1,2). Microsoft narrows this to the private cloud (3). IBM restricts this even further, saying IT transformation is about “consolidation, standardization and—most important—virtualization” (4).

There’s more. According to CIO Magazine, IT transformation is about the ability to show cost of services (5). CapGemini says IT transformation is about “identifying the key business drivers that impact the IT function, and their implications on IT operations [sic]” (6). And Accenture has perhaps the most interesting proposal of all: IT Transformation is about getting rid of all vendors except Microsoft (7). If only it were that easy!

Each of the opinions has a grain of truth. Certainly a transformed IT operation will make effective use of the cloud and will find ways to consolidate its servers through virtualization. A transformed IT would understand how to show its cost of services and be able to identify its key business drivers. And most would concede that Microsoft technologies can contribute cost effectively in many areas.

But each of these opinions lacks a larger perspective. IT transformation is not about adopting the latest technology or business fad. True IT transformation is about rebuilding, from the ground up, the relationship between the business and IT.

Sarah Runge and I have been discussing what such an IT transformation might look like. Sarah is the author of Stop Blaming the Software and approaches the business/IT problems from the perspective of the business. I am author of Simple Architectures for Complex Enterprises and approach these same problems from the IT side. We have found valuable synergies in our perspectives. We too are calling for a transformation, but a transformation that goes to the very heart of the business/IT relationship. We call this radical IT transformation.

Why do we need a radical IT transformation? In a nutshell, we don’t think most organizations are coming close to realizing the potential benefits of their IT investments. We see many IT organizations stretched to the breaking point just trying to maintain existing systems. We see critical new projects being shelved. The new projects that are done are often delivered late, over budget, and missing key functionality. We see many organizations in which the business doesn’t trust IT and IT feels marginalized by the business. And we believe that few large organizations are well positioned to leverage interesting new technologies such as the cloud. Does any of this sound familiar?

We believe all of these problems can be solved, but we don’t think they will be solved with piecemeal solutions. We need a radical transformation not in only in how IT does its job, but in how business and IT work together.

Radical IT transformation is a foundational transformation of the entire business/IT relationship. At its core, the transformation takes us from a technology-centric business/IT relationship to a business-centric business/IT relationship. This transformation includes a number of strategic shifts, each playing a role in the bigger transformation. I’ll briefly describe each of these shifts, saving details for later presentations.

Shift 1: From IT driven to business driven solutions. Today, IT does its best to understand the business and then use that understanding to drive IT projects. In a transformed organization, business takes the lead in driving all IT projects.

Shift 2: From big to small. Today, IT often tries to deliver large far-ranging solutions. In a transformed organization, IT delivers small solutions targeted at very specific, well-defined problems.

Shift 3: From complex to simple. Today, IT projects quickly grow in complexity driving up cost and increasing risk. In a transformed organization, IT intentionally delivers the simplest possible solution that meets the business need.

Shift 4: From long-term to short-term value. Today, IT organizations focus on delivering long-term value from their projects. Unfortunately conditions and technologies evolve quickly, making long-term projections nearly useless. In a transformed organization, time-to-value is a more important metric than projected long term ROI.

Shift 5: From process focus to delivery focus. Today, many IT organizations are mired in lugubrious processes that drag on indefinitely and deliver little value. In a transformed organization, processes are slashed to the absolute minimum and delivery is rewarded.

Shift 6: From internally owned to public cloud environments. Today, most IT systems are running on costly privately owned machines that require huge operational investments. In a transformed organization, many more IT systems will be running on highly efficient leased cloud systems that require minimal operation investments.

Shift 7: From IT centric to business centric architectures. Today, most IT organizations create IT architectures that are independent of the business processes they support. This creates a major IT drag on business agility. In a transformed organization, the IT architecture intentionally mimics the business architecture, resulting in highly agile IT systems that can turn on a dime as the business evolves.

Shift 8: From design to implementation. Today, most IT organizations spend considerable time “doing design.” In a transformed organization, there is much less design done in IT, since the overall design is driven by the business architecture (see shift 7.) While IT doesn’t completely leave the design business, IT is seen as primarily responsible for implementing the design that is defined by the business rather than creating the design that will be used by the business.

Shift 9: From long to short time frames. Today, most IT organizations measure their milestones in months and their delivery dates in years. In a transformed organization, entire delivery cycles are reduced to months or less. With processes slashed, design de-emphasized, and focus shifted to small and simple solutions, time to deliver is cut to the minimum.

Do these shifts resonant with you? Perhaps you are a candidate for a radical transformation. If so, stay in touch. We’ll be discussing this more in the coming weeks.

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Workshop Announcement: 
Radical IT Transformation with Roger Sessions and Sarah Runge
For my New Zealand and Australia followers, I will soon be doing a workshop with Sarah Runge, author of Stop Blaming the Software. We will be spending two days discussing our work in Radical IT Transformation, a better way to do IT.
Auckland: October 11-12 2012
Sydney: October 15-16 2012
Cairns: October 18-19 2012

Check out our Agenda or Register!


(1) http://h30507.www3.hp.com/t5/Transforming-IT-Blog/bg-p/transforming-it
(2) http://www.cisco.com/assets/sol/cloud/cloudverse_videos/index.html
(3) http://www.microsoft.com/business/events/en-us/PrivateCloudExec/#fbid=J5GaDAi8tB6
(4) http://ibm.co/MCnX7s
(5) http://www.cio.com/article/663015/Transforming_IT_to_Show_Cost_of_Services_5_Best_Practices
(6) http://www.capgemini.com/services-and-solutions/challenges/transforming-it-function/overview/
(7) http://www.accenture.com/us-en/pages/success-accenture-microsoft-transforming-it-summary.aspx


Photo of Potter’s Hands is by Walt Stoneburner (http://www.flickr.com/photos/waltstoneburner/) licensed under Creative Commons