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The Modern IT Department: Driving Business Innovation

Introduction

Every working person wants to go home each day feeling like they have made a contribution to the health and growth of their organization. However, members of the IT team often feel disconnected from the organization they work for. They come to work worried about a network security issue, or mulling over a complex programming problem; they are uninvolved in or even unaware of their companies' core business mission. This limitation is often magnified when IT staff are operationally and sometimes physically segregated from the business's core staff.

Why are IT departments so often separated from other business functions? To explain this, one must consider that IT computing is one of the newest staff functions of most organizations. Computers emerged in the 1960s, and only started being used by mostly large businesses in the 1970s. Most of the other functions of running an organization, such as business management, accounting, finance, operations, sales and marketing, have much longer histories. Thus, IT remains the new kid on the block, never fully integrated into or utilized by the business.

The cost to organizations which have not fully integrated IT into their business can be high. Gartner and other research firms often quote IT project failure rates, measured by lack of on-time, on-budget delivery, to be close to 80%. This is an organization-wide problem, not just an IT problem. When IT projects run over budget, it is quite common for the blame game to occur between IT and business managers, further isolating IT from the core organization. A lack of shared understanding of IT's potential value when it is closely aligned with the business, and its associated synergistic effects for the overall organization, engenders a mistrust of the IT function and dooms many of its projects to failure.

Given the rapid advance of technology across virtually all industries and sectors, IT can no longer be viewed as a cost center purely working to keep the lights on and the gears turning. IT must transform and integrate into the core organization in order to become an agent for business innovation. The rest of this article describes how to achieve this transformation within your organization.

Transformation

It is time to bring the IT organization and the rest of the business together as a closely aligned team, where successes and failures are shared by the entire organization. Not surprisingly, the transition to this new paradigm will not happen overnight, but will take place over time, as everyone sees evidence that the organizational shift is working.

Process Improvements

There are a number of process improvements which often yield material benefit to the organization. Some will be specific to your organization's structure or industry, but here are a few that tend to be somewhat universal.

Emergent Capabilities

Summary and Conclusion

IT innovation begins with senior management having confidence in the IT organization. Senior management establishes the strategic direction for the company, which almost always requires some form of IT innovation. With a joint IT/business view of the organization's strategic direction and how IT can support that vision, as well as a clear understanding of the status of IT projects underway, senior management can identify functionality gaps which can largely be filled with innovation-based projects.

As a natural outcome of an open and ongoing dialog between IT and other business areas, proactive thinking will occur, leading to innovative ideas that can be presented to senior management. This results in the best possible outcome of upward and downward organizational innovation being articulated—and acted upon.

We are rapidly moving into an age in which virtually every business must be technologically accessible. Technology users range from nursing home residents using handheld computing to get their news, weather and family photos all the way down to preschool children learning their ABCs on handheld devices. We have become a computer-literate population, putting IT front and center within organizations. Meanwhile, today's businesses must leverage their IT assets as never before, providing business intelligence, responsiveness and competitive agility.

Clearly, IT can no longer be disconnected from the business, but rather must have an equal standing across organizational areas. IT can no longer be viewed as tactical—it is strategic. In its short life, the IT function has evolved from a peripheral enabler to a fully integrated strategic partner providing much-needed creativity and innovation. Organizations must recognize and embrace this transition.