Change or die - the changing role of IT departments

The IT industry is undergoing a seismic shift. Unlike previous technology revolutions, the changes to the way services are delivered to organisations and end users is forcing dramatic changes to the way organisations view technology, and how they are structured to deliver IT services. Change is happening, and how organisations choose to react to that change will determine their future relevance in the marketplace. What is driving this change, and how can organisations, specifically IT departments adapt and thrive?

I was watching an article on the news the other night that talked about IP-based messaging platforms (like iMessage) replacing trusty old SMS. The recent acquisition of WhatsApp by Facebook for an eye-watering $16 billion USD shows just how much belief major industry players have in growth opportunities around this segment of the market, at the expense of ‘legacy’ telecommunications providers.

In the same way that telcos are seeing their role being relegated to a commodity provider of a ‘dumb pipe’ for home and mobile broadband, those in the traditional IT infrastructure space are also at risk of having their lunch eaten by external competitors who can now deliver what was traditionally a complex service as an on-demand utility. Cloud infrastructure is transforming delivery and operation of servers, storage and network devices into ‘dumb infrastructure’ commodity services.

Today, few IT departments have the depth and breadth to design, develop, test and operate an entire suite of enterprise applications. The rise of ‘off the shelf’ enterprise software over the last 30 years demonstrates the validity of a model where much of the heavy lifting is provided by an external vendor when in house-capability does not exist, or an organisation chooses to focus its limited resources elsewhere. In recent years we have seen this approach extend further, to a full Software as a Service (SaaS) delivery model where all aspects of the software development lifecycle are managed by the service provider.

The progression of software delivery towards SaaS points to the future of IT infrastructure within an IT department. Rather than build and operate infrastructure using ‘off the shelf’ servers, storage, networking and operating system components, a range of Infrastructure as a Service (IaaS) offerings are available on-demand. IaaS increases the responsiveness of technology to business needs, provides cost reduction opportunities, and delivers a better quality service while shielding customers from the complexities of service design, delivery and operation.

The benefits of IaaS are often the same attributes used by IT departments to justify their existence to the business. If one of the core capabilities of IT is no longer perceived to be of value, how can it continue to remain relevant to the business? Transforming IT from its current role as a service provider to one of a service broker is one such way to retain relevance. While some technical skills will remain relevant, especially those related to security, integration and data management, others such as system design, delivery and operation will recede in importance. The real shift however is moving away from a focus on technology towards a consultative model where IT works as part of the organisation to deliver business outcomes. An increase in skills relating to business processes, requirements analysis, the management of commercial agreements, and most importantly, the successful management of the intersections between business and technology will be required by tomorrow’s organisations.

Change of such a scale is not easy, and requires understanding, planning and commitment at the very highest levels of an organisation. Those that are able to successfully make the transition will reap the benefits of utility computing and flourish in tomorrow’s environment. Those that hold tightly to old operating models may find themselves like many of today's telcos - a service provider without a customer.