Outsourcing looks good

Obviously, this major consumer goods manufacturer's current ad hoc and decentralized IT approach has failed to support the company's corporate objectives adequately and has led to a severe deterioration in the reliability of its IT infrastructure and application services. As a result, IT leadership must take greater control of day-to-day IT operations end to end, and create a common vision for IT's overall role within the company.

IT leadership's first step must be to establish a stricter set of corporate IT priorities, policies and procedures for governing operations. This means that many of the company's IT decisions must be more directly based on corporate objectives. It also means that IT decisions must become more centralized to ensure better coordination and greater cost-savings.

Centralization might not sit well with IT staffers who previously have been allowed plenty of freedom to make their own decisions and to operate independently or with business units that had been making IT decisions autonomously. Given potential political ramifications, the move to a more centralized operating model should be mandated and fully supported by the company's senior management, starting with the CEO and CFO.

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Obviously, this major consumer goods manufacturer's current ad hoc and decentralized IT approach has failed to support the company's corporate objectives adequately and has led to a severe deterioration in the reliability of its IT infrastructure and application services. As a result, IT leadership must take greater control of day-to-day IT operations end to end, and create a common vision for IT's overall role within the company.

IT leadership's first step must be to establish a stricter set of corporate IT priorities, policies and procedures for governing operations. This means that many of the company's IT decisions must be more directly based on corporate objectives. It also means that IT decisions must become more centralized to ensure better coordination and greater cost-savings.

Centralization might not sit well with IT staffers who previously have been allowed plenty of freedom to make their own decisions and to operate independently or with business units that had been making IT decisions autonomously. Given potential political ramifications, the move to a more centralized operating model should be mandated and fully supported by the company's senior management, starting with the CEO and CFO.

Start with an audit

With its new authority, IT leadership must next initiate a thorough audit of IT and application service levels and assessment of current and future business requirements. To ensure an objective assessment, this audit should be either conducted by an independent firm or by an internal team of IT and business representatives that report its findings to senior management.

The audit should target specific performance problems that are hampering business success today and those that could adversely affect the company soon. It should determine which problems are directly related to technology issues vs. those that might be a result of poor IT management practices. Given the escalating impact of the IT operating problems, the company needs to make important changes quickly. This audit process should take into account typical business cycles, but should not take more than 90 days.

Move on to outsourcing strategy

Given the company's limited resources, IT leadership then should develop an outsourcing strategy based on the specific priorities resulting from this audit and assessment. An outsourcing strategy should determine what roles outside solution providers will play in resolving the current problems, building an IT infrastructure and deploying applications that best satisfy the company's current business needs and meet its future corporate objectives. IT leadership needs to do this with the understanding that revamping the IT architecture and applications entirely on its own would not make good business sense given the rapidly expanding array of outsourcing or "out-tasking" alternatives.

Consider specific managed services

As they've matured, managed services have become beneficial for large-scale companies that want to offload specific IT functions. Independent managed service providers as well as a growing variety of hardware and software vendors, telecom carriers and resellers offer these services.