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Blogs > MWD Advisors

Neil Ward-Dutton By: Neil Ward-Dutton, Research Director, MWD Advisors
Published: 9th September 2011
This work is licensed under a Creative Commons License
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Over the past couple of years we’ve all heard more and more talk about the potential for IT to transform business and drive innovation and profitability—and hand-in-hand with this, the potential for CIOs to be seen as in charge of IT groups that are true ‘strategic business enablers’ rather than simple cost centres. This is very sensible and a natural consequence of the changing role that IT has come to play in business over the past 20 years, as it’s moved out from the back office as ‘Data Processing’ to become a ubiquitous enabler for people to share information, buy products, and interact with each other.

So the idea that the effective application of IT can drive real business transformation is not what I have a problem with—I’m actually a massive proponent of this kind of vision, and indeed exploring the ins and outs of this is what MWD is essentially about.

No, the problem I have is when I see ‘experts’ positioning these things as exclusive alternatives:

  • As a CIO you have to be either running an IT function that is a strategic business enabler *or* a cost centre
  • You have to drive collaborative, consultative dialogues with business leaders *or* you have to be a transactional ‘order taker’
  • You have to be focused on driving ‘innovation’ *or* minimising costs.

I’ve come across a number of commentators—including the normally pretty sensible Nick Carr, as well as a Research Director from one of the very largest IT industry analyst firms—argue this very black-and-white view.

The problem is, it’s a massive over-simplification of the real world. The truth is that (as many people tire of me saying over and over again) in this case, as in so many others, we live in a world of ‘and’, not a world of ‘or’. The truth is most obvious in larger companies, but it’s everywhere: IT needs to play multiple roles in multiple contexts if it’s really going to serve the needs of a business in the most effective way.

If you take a capability-based view of business and explore how IT resources should support different business capabilities in different ways, it quickly becomes apparent that in some areas, even the most forward-thinking CIO with strong peer relationships at the highest level should be looking to structure some parts of his operation to act as transactional order takers, delivering ‘good enough’ service at minimal cost (email service might be a good example for many). On the other hand IT services and capabilities (examples might include services supporting sales and marketing optimisation, customer interfaces, product development) should be optimised for flexibility and creative exploration; here, IT governance policies might be best focused largely on the ‘edges’ of these areas to make sure that creative use of IT is expressed within clear boundaries. Where services and capabilities should be optimised for cost—this is where governance should focus on centralisation and standardisation as far as possible.

As the above suggests, a more nuanced view of the role that IT should play has significant impacts on the terms of reference and charters for IT governance and architecture functions. I find it alarming how many architecture teams, for example, see their role largely as one of standards-enforcement: things are starting to change, but change is slower than it needs to be IMO.

I suspect that a great many of my “Calling BS on…” series of posts are going to boil down to two possible arguments: one against simplistic either/or thinking, and the other against ‘XYZ is dead’ posturing. Let’s see, though…

As always, I’d love to get your views in comments. Come on, rant with me!

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