About a week ago, MIT Principal Research Scientist Joe Peppard wrote a piece for the Wall Street Journal, “It’s Time to Get Rid of the IT Department.” Peppard’s expertise is CIO-centric tech leadership. His thesis, which I mostly, agree with is that keeping IT as a separate unit from the business hurts the entire organization. In short, black boxing IT sets the department and the organization as a whole up for failure.
In the digital age, the way we approach business and technology has changed. As we pivot and pivot yet again, the intersection of business and IT is where the future lies. Corporations should consider looking to the public sector for a framework for integrating IT with the company. IT departments over the last two decades have evolved tremendously. They’ve moved from partnering with the service units to serving as the channel for service delivery via web services, automation, apps, etc. As a result, IT is a driving force in all aspects of the organization, and the modern IT leader is an innovator who creates and manages change across the entire agency.
This next generation of IT leadership has upskilled as AI, machine learning, and automation evolve. Overall, IT roles have grown to understand the nuance of service units or business units. CIOs now construct a workforce and culture that drives innovation and one that will facilitate the customer experience, encourage business goals, and is formally tied to delivering on strategic growth.
Also-every organization in existence needs tech. Peppard thinks:
“After all, technology is no longer an option, something distinct; it is a competitive necessity. Covid-19 has only reinforced the fact that most organizations can’t survive without tech. It is deeply fused with the work of staff, a core enabler of business models, and driver of customer experience….The value a business gets from technology doesn’t come from its possession. Success isn’t about building and managing IT systems.”
Ultimately, IT departments become a lynchpin for the organization, meaning they aren’t partnering per se, but they are– says Peppard, “contributing to business outcomes.”
As I mentioned above, we frequently see this type of business integration in the public sector. Here is what it looks like. Organizationally, most IT (outside of the hardware, networking folks) consists of embedded analysts in each department. Their goal is to help deliver on the business outcome of the department. They may or may not report to a CIO.
Private sector companies are moving to this model. They see IT as a strategic advantage, or service delivery through IT gives them a competitive advantage. Some of the business outcomes are similar to the public sector, such as compliance, security, records management, customer service, finance functions, receiving functions, and facilities management.
This all sounds easier said than done, but there’s one prevailing attitude in business that will never change: adapt or fail. I think we’ll be seeing more of IT contributing to business outcomes in the future.