IT Functions of the Future
July 2, 2012 4 Comments
How IT utility is delivered in the future will be less a technical or technology only decision and more a enterprise strategy. Factors such as Operating Costs (Economics), Mobility, Service Reliability, Flexibility and Risk to the Enterprise will come more into play. This suggests that the backroom strategy topic of organizational design will play an increasing role in enterprise competitiveness, as choosing where and how IT utility is delivered will have critical consequences.
| Factors | ITIL Service Provider Type | ||
| Type I – IBU | Type II – SSO | Type III – ESP | |
| Operating Cost | |||
| Service Reliability | |||
| Flexibility | |||
| Risk | |||
| Hosted | On Premise | |
| External Staff | Public Cloud? | Out-Source? |
| Internal Staff | Hybrid? | Private Cloud? |
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In the future it will be less important to where data is stored and more important in the contextual interest into said data will be relationships with people with interests in said same data.
A couple questions:
1) What does Type I, Type II, and Type III Provider types mean?
2) When was the last time Operating Cost not part of the equation? Maybe back prior to the dot bomb – but really since then? Must have been nice to not have to prove (even just on paper) ROI
Maybe I’m missing your point here – I’m not sure people are not already looking at business need, risk, architectural standards, costs (up front/on going), return on investment, and vendor relationship for ANY IT spending – not just those that you consider ‘utility’
Can you clarify what you mean here…
Thanks
Type I, II, and III providers are the classifications ITIL gives to Integrated (Internal to business unit), Share Service Organization, and External (e.g., Outsource, ISP, etc.) Providers. Regarding thew factors, yes they are considered but not to the extent of the total cost benefits. Consider if you started with a clean slate: Why would you develop an in-house IT department for your finance group vs. a share service organization like the typical IT function or buy a service like ADP? There are benefits and risks to each approach. The profile are different for each type of provider that include all of these factors. When all of these factors are considered holistically the C/B analysis may be different. Not all ISP arrangements are cheaper, the risks of using such a provider are different than that of internal.
This suggests the typicl ROI model is not sufficent in making these decisions anymore. The research I’m doing will result in a series of White Papers that my employer will use to guide field staff in determining the best option for the client. Its too easy to get into technology or architure astehtics or ROI spin discussion. What I’m attempting to develop is a framework for an open an honest discussion with clients on how to improve the IT Capabilities the business uses. This is open piece in a larger narrative.
If I can repeat to you what I think you are saying…
A business identifies a problem and begins work to provide a solution to that problem. The problem can be solved by either:
Providing a technology solution from within the business unit (Type I)
Providing a technology solution from a ‘shared service’ (Type II)
Providing a technology solution from an external provider (Type III)
And what you are saying doing ROI (by itself) is not sufficient (presumably, any of these 3 options could show positive ROI) but there are other important factors to consider before choosing one of these options – such as Flexibility, Reliability, Security, Risk, Operating Cost…
I am guessing that this type of discussion is outside (above? next to?) the traditional ‘shared service’ IT model? Meaning, this isn’t taking place inside of that organization (CIO, IT Directors, and such) but outside (Business leaders) that organization – but perhaps with (one would hope).
In my thinking Type III should be centrally managed – probably by Type II. Type I should be generally avoided excepting in particular cases – usually around quick business opportunities, need for fast growth, rather short term (6 months – 2 years).