The Transformation of IT – From Builder to Broker

By Christopher Carter

When I was thinking about writing on this topic, it occurred to me that the title should be “How I Learned to Stop Worrying and Love the Cloud.” But Google tells me that’s been taken, and I don’t have a backup title nearly as pithy. So you’ll have to live with “The Transformation of IT – From Builder to Broker.” It captures the heart of what I’d like to discuss.

IT has always been in the business of change, but much change has been driven from the inside out. IT guided the process of system rollouts and new technologies. That is changing, and changing quickly.

The typical IT function faces considerably more outside pressure than in the past. The consumerization of IT and availability of enterprise-class applications via on-demand/subscription models has fundamentally disrupted business as usual in the information technology department. The expectation of what (and how quickly) technology can deliver to the user has increased dramatically. The availability of “competing” services for almost every conceivable function traditionally delivered by the in-house technology group has enabled a new second generation of “shadow IT.”

In my experience as both a consultant and internal IT leader, I have seen the full range of IT reactions to “the cloud.” Some have embraced it and others have forbidden it, while most fall into an ambivalent middle ground. Regardless of your stance on whether cloud and on-demand computing in enterprise IT is a good thing (I personally think it is), it is here to stay and will only become more prevalent. If you are fighting the cloud, you are tilting at windmills.

Traditional IT departments must adapt or be left behind by a user base that demands more flexibility, innovation, and responsiveness. For most of the history of information technology, conventional wisdom was to limit the number of application vendors and consolidate on one or a few primary technology stacks, whether from IBM, Oracle, SAP, Microsoft, or a few other vertical-specific behemoths. The phrase “one throat to choke” was used to describe the desire to simplify vendor management and minimize finger pointing when issues arose. Those were the good old days.

Today there is a growing class of best-of-breed Software-as-a-Service (SaaS) offerings that cover the spectrum of common business functions, from customer relationship management to human resource management to financial management. There are also many more targeted applications that provide industry- or function-specific workflow and analytics. These “Web 2.0” services are natively mobile, available anywhere, and highly configurable. They also benefit from modern user interface design techniques and sensibilities. Updated regularly, new features are rolled out with little to no disruption. They are outcompeting more traditional software vendors on features, speed to delivery, and price. From an end-user standpoint, it is difficult for the installed base of previous-generation technology to compete. It should be little surprise when a savvier and more demanding user base becomes frustrated with limited IT budgets and aging legacy systems, and turns to cloud providers to satisfy its needs.

Just as managed service providers and cloud computing platforms are allowing businesses to offload their server and network management to highly specialized vendors, the oversight, maintenance, and customization of specialized software stacks is also being pushed outside the enterprise. Where does this leave the IT department? One option is to fight, insist that technology be deployed centrally and managed in house. Often security, privacy, system flexibility, and data portability issues are cited as reasons not to adopt cloud services. These are all very valid concerns. However, I don’t believe they are indictments of cloud services as a whole.

Instead, they are criteria for evaluation of individual services, as each vendor will devote a different amount of resources to things like security and integration capabilities. Just like every other modern industry, the Internet and other enabling technologies have allowed smaller, nimbler, and more creative independent software vendors to distribute their technologies to the masses. It would be a shame to ignore this valuable source of innovation.

A more pragmatic approach is to accept that cloud/SaaS services are a permanent and growing part of the IT landscape and are the future of enterprise computing. The IT department must transform itself to be more flexible and outward looking. This isn’t a process that will happen overnight, but it must begin now for those who haven’t already started. This is not to say that the traditional IT structure will immediately vanish; instead, the footprint of in-house installed, customized, and maintained systems will decrease over time as those are replaced with a range of SaaS systems. IT leaders must recognize and plan for this.

The real dangers with cloud computing lie in a return to data silos and a loss of governance. Without oversight and guidance, end users are likely to make underinformed purchasing decisions and not consider all the architectural issues and unintended consequences that can arise. Without guidance, a proliferation of redundant, disconnected systems may pop up, and the company may struggle to have meaningful visibility into its own data. Modern IT departments are best served being a trusted advisor to guide their companies through the increasingly complex choices available. In fact, IT is the only function in most enterprises capable of performing this.

So how best to deal with this change? The information technology department needs to embrace its role as a service broker to the organization. This has long been a concept in the Information Technology Infrastructure Library (ITIL) world (and other service management methodologies), but it is truly time that all IT organizations align themselves in this manner. The role of “Cloud Services Enabler” should be created as a formal function in IT. The enabler plays the role of trusted advisor and ensures that users make choices that fit not only their needs but also into the company’s larger information architecture. This group should have at a minimum the following responsibilities:

  • Continuously research and explore new SaaS tools and offer them to the business.
  • Vet potential cloud vendors, ensuring that minimum system and data architectural standards are met
  • Assist in the procurement, negotiation and selection process for cloud vendors
  • Manage service catalog for cloud vendors and enforce standardization when appropriate
  • Ensure that cloud vendors meet all contractual and operational enterprise security and privacy requirements
  • Bring best practice program and project management methodologies to coordinate system deployments and integrations
  • Ensure that enterprise master data is integrated and used properly
  • Ensure that operational data is available to appropriate corporate analytics and reporting systems
  • Continuously monitor and manage cloud vendors’ profiles and performance on security and privacy
  • Monitor and manage cloud licensing and usage
  • Own and manage the enterprise integration platform tying cloud systems to other enterprise systems, data stores, and each other

IT plays a critical role in this new world—perhaps even more critical than before. The distinction is that much of the work is shifted to roles that are consultative in nature and closer to the business.

Architectural considerations include types and sophistication levels of integration points, reporting and analytics capabilities, monitoring capabilities (including the ability to integrate with enterprise operations monitoring and management systems), and integration with identity and user lifecycle management systems. Concerns about backups, security, privacy, data availability, and data and business logic portability also factor in. These aren’t reasons to say “no” to cloud applications; instead, they should be real requirements based in a pragmatic integration strategy. Note all of the functions that are still required in the IT department, from business analysts and project managers to integration specialists and data architects—there is still a critical role for IT in the center of all this.

The common theme is coordination. IT’s role in the future is to ensure that all the useful (but disparate) systems and services utilized by the organization in its day-to-day business are properly orchestrated, connected, and optimally configured. This will require an even higher degree of organization, communication, and discipline to manage. Proper governance and strategy have never been more important.

The promises of Service Oriented Architectures are finally being delivered on. Progressive technology departments are transforming themselves from the classic IT organizational chart of 30 years ago (infrastructure/applications as standalone groups) to business-focused, customer-oriented internal consultants concentrated more on information than technology. Is your organization ready?

The views and opinions expressed in this article are those of the author and do not necessarily reflect the opinions, position, or policy of Berkeley Research Group, LLC or its other employees and affiliates.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s