There's a frequent observation that our familiar enterprise IT function might be better branded as "enterprise IS" -- information services.
The business people paying the bills aren't all that enamored in the technology itself, but ultimately what it can do for them -- preferably consumed as an attractive, competitive service.
Over the last few years, I've written more than my fair share about the changing IT model, what an IT transformation looks like, our experiences here with EMC IT, and more.
My fascination continues unabated.
While IT certainly has a long journey ahead of them, so do the business people who use IT. While IT must become efficient producers, business people must also become intelligent consumers.
So, how are we collectively doing on this? Not as well as I might have hoped ...
Recently, EMC and VMware commissioned IDG (publisher of CIO magazine) to survey both sides of the phenomenon: IT's perception of their progress, as well as business's perception of their progress.
Like most well-run surveys, there's a ton of data with multiple potential interpretations.
Here I present mine.
The Survey Basics
I can't take any survey seriously unless there's a full disclosure around methodology.
Since there is no such thing as an unbiased survey, I like to judge for myself whether or not any structural sampling biases are skewing the results.
This survey is better than most: it's recent, reasonably large (366 qualified responses) and suitably diverse with respect to company size, geography, industry, etc.
While I'm not opposed to using online questionnaires when they're suitably managed, I find the "Fill Out A Survey, Win A Gift Card!" approach particularly abhorrent.
I would have liked to see an equal number of respondents from both IT and the business, but I did appreciate that the majority of business respondents came from LOB leaders -- which is where the real action is.
Some of the terms are used interchangeably: "ITaaS" (IT as a service) is used as a convenient shorthand for "running IT like a business".
The Big Takeaways From IDG
Here's my summary of IDG's summary:
Agreement on the importance. Both IT and the business think it's important that IT runs like a business, but IT leaders are far more optimistic about the progress to date.
Disagreement on benefits. IT thinks ITaaS is mostly about cost savings, while the business points to alignment, efficiency and customer satisfaction as the main drivers.
IT leadership wearing beer goggles? Business execs say there's much more room for improvement than IT leaders think: improving time to market, communicating a clear vision, gaining the trust of business stakeholders, informing the business of new services, articulating business value, enabling innovation and collaboration, and supporting mobility.
Disparate views of the challenges ahead: both audiences can point to challenges that must be overcome, but the lists are very different.
The business is not shy about going outside of IT. Over half of the respondents say that this is not unusual anymore.
IT is working to close the "business gap". Through hiring and training, IT leaders are investing in knowing more about the business and what it needs.
For IT, the hard work lies ahead. While many IT leaders feel they're through the first stages of an IT transformation, few have gotten to the heavy lifting: service catalogs, transparent financial models, new organizational constructs, etc.
Yes, ITaaS Is A Priority
Good news: there appears to be wide agreement on the desired model -- at least at a conceptual level.
70% of IT leaders rank moving to an ITaaS model as either critically important or very important. Fortunately, 62% of their business peers agree. That's a strong starting point.
Interestingly enough, the effect is more pronounced outside the US: only 54% of US respondents fall into this category, while the number soars to 70%+ outside the US.
No, I can't explain this discrepancy.
Are We Making Progress?
A surprising 30% of IT leaders assert that their IT operations run like a business today -- but only 18% of their business peers agree.
The significant majority of both IT and business responses are pragmatic: we've started, but there's much more work to do.
A difference of 12 percentage points between IT perception and business perception should raise a bit of concern.
A preview: we'll see more of these asymmetric perceptions as we go through the findings.
IT More Optimistic About The Benefits
Generally speaking, IT leaders tended to rank the benefits of an ITaaS model more strongly than their business peers.
This makes sense to me: IT leaders are closer to the action, and can more readily appreciate the potential wins.
However, this result indicates that there's a yet another perception gap between IT's enthusiasm and the business population -- which, of course, points to a communication challenge.
The widest gaps appeared around hot-button topics like self-service environments, innovation, creating a competitive edge, and increased revenue and efficiency.
Again, this indicates to me that IT perhaps should invest some time to help business people understand what all the enthusiasm is about.
How Are We Doing On This Virtualization Thing?
Good news -- one of the core technologies behind ITaaS (virtualization) is coming along nicely.
52% of IT respondents consider themselves "pervasively virtualized": more in US and APAC, less in EMEA.
No, I can't explain this discrepancy either.
Better yet, 45% of business responses say that they're seeing the resulting impact: cost savings, agility, responsiveness, etc.
The rest of you -- perhaps it's time to get busy?
The Easy Part Is Done, The Hard Work Is Ahead
There's a wealth of detail in this next chart, so let's dig in.
Starting with the IT side, there's a list of activities associated with ITaaS, ranging from pragmatic to rather challenging.
Topics like streamlining, consolidation and standardization appear to be well in hand for many.
However, the more challenging aspects -- converged infrastructure, creating a service catalog, charging for services consumed vs. individual projects, recreating the organizational model -- show much less progress.
Moving over to the business side, there's some rough correspondence. Business leaders give IT high points on topics like data security, business efficiency and reduced downtime -- but most of those topics have always been in IT's wheelhouse.
On more compelling topics like creating consumption portals, delivering meaningful cost savings, increasing revenue, innovation, mobility, etc. -- far lower ratings.
Drilling Down On The Communication Gap
Is there a structural communication gap between IT and the business? This survey result would lend credence to that assertion.
For example, 25% of IT leaders think they do a great job of understanding what the business wants. Unfortunately, only 10% of business leaders agree.
21% of IT leaders think they're doing great on improving time-to-market for the business -- but only 9% of their business peers agree.
21% of IT leaders think they're doing great on communicating a vision for future IT services; only 9% of business leaders agree.
17% of IT leaders think they're doing well on gaining the trust of business leaders; only 9% of business leaders agree.
There are other similar findings, but the pattern appears clear -- there's a perception gap between what IT leaders think they're doing well at, and how their business colleagues perceive them.
The list continues. Active outreach to the business. Articulating business value. Enabling business innovation. Making it easier to work collaboratively between the business and IT. Customer satisfaction. Mobility.
Gap after gap.
The answer? Communication -- consistent, clear and pervasive engagement. Either the business scores will go up, or your self-perception rating will decline. Both are healthy outcomes.
If you're an IT leader, you might look at your calendar for the last few weeks -- how much time is being invested engaging outside of IT?
The IT View Of The Challenges
Nothing good is easy, and nothing easy is good. Getting to an ITaaS model is hard work over the long haul, there's no easy recipe that's been found yet -- other than simply starting over.
So, where does IT leadership think its struggling?
Security and compliance challenges lead the list, followed by cultural resistance, insufficiency skills and difficulties associated with getting to a pricing model. Add in lack of resources, and a crushing legacy burden -- and the picture becomes clear.
From a personal perspective, I've seen that the lever is getting the people right: right skills, right attitude and right goals in a subset of the organization where progress can be accelerated; and new know-how transferred to the organization at large over time.
The Business View Of The Challenges
An unsurprising finding: fully 45% of the business replies pointed to lack of effective communications between IT and the business as a major obstacle.
Maybe we should offer "Being An Effective Communicator" coursework to IT professionals?
Difficulty in process change comes next (not surprising), and then -- a real gem: business doesn't understand the value of IT, or what is now possible with technology.
Communication, communication, communication …
There's also an interesting cluster around the finance aspect: not getting the required metrics, lack of transparency around service costs, lack of overall financial transparency, etc. None of this is surprising, based on my experiences.
And, finally, some troubling findings: doubts about IT's technical skills, lack of business skills, doesn't respond well to ideas and suggestions, lack of exec sponsorship. Again, perhaps more aspects of the overall communication challenge we've already discussed.
We're Going Outside -- Get Used To It
Well over half the respondents say they regularly go outside for IT services -- it's an inarguable part of the landscape these days.
The real unanswered question -- how many of these outside services are brokered as part of a consultative IT relationship, and how many are simply business people getting frustrated and taking matters into their own hands?
Working effectively with outside service providers creates its own challenges for the IT team -- there's no free lunch it seems.
The concerns should seem familiar: data security, application integration, ensuring compliance, figuring out how the service gets paid for, compliance, and more.
There's a particular gem halfway down: end user support. 27% of the IT respondents state that they're expected to provide end-user support for outside solutions, even if they had nothing to do with the decision.
That's got to be very frustrating …
The business view is illustrative as well.
Top ranked benefit: speed.
Getting to market faster, being more agile, etc. This one is tied for access to specialized domain knowledge that the IT team might not have.
For all of you who can't understand why the business would want to go outside, here's your answer: rapid access to capabilities and smart, specialized people. You can't fight it, but you can leverage it by owning the relationship.
Way back when, I was in a position where I was considering going outside of IT for a project I was working on.
It was a pain in the rear end.
Evaluating vendors, trying to decipher what they were saying, teaching them about my requirements, dealing with aggressive salespeople, etc. -- it was a big investment in time, and something that wasn't fun.
Far better these days when I can approach my IT team and have them front-end a lot of that for me -- that brings enormous value.
What Skills Do We Need?
Finally, a positive note -- there's strong correlation between the shopping list of skills that IT thinks it needs, and the perspectives on the business side.
Topping the list: aligning IT services to business requirements. Frequently, this is described as the "product management" function within IT: creating the portfolio of products (services) that people want to consume.
Complement this with a decent go-to-market (communication, "sales", engagement, etc.) and that appears to be the winning formula.
Final Thoughts
If IT is to run as a business, it needs to be good at the same things a business is good at: delivering products and services that people want to consume, putting customer satisfaction at the head of the list, learning to be effective communicators, efficient delivery, and so on.
The blueprint for success isn't really that radical; the substantial challenge lies in applying the template to an organization that was constructed very differently. Strong leadership, effective communication and comprehensive change management become the critical skills at the IT leadership level.
The journey has clearly begun -- but, for most, there's still a lot of road ahead.
