IT Doesn’t Matter: What every IT pro needs to know to survive in the cloud era - Part 2

Part two of this post picks up focusing on the types of organizational changes that may be coming to IT and to business models and organizational structures in the cloud era, specifically how to leverage coming changes to our own advantage.

The first part of this blog outlined the scope of this post, which is to really understand what business leaders value and don't value about IT, and highlighted the significance of differentiation. This post will pick up where the last left off, focusing on the third and potentially most significant aspect of why "IT Doesn't Matter"...and that is how exactly to define the scope of "IT" and how it fits into your organizational structure.

Now, a lot of people offended by the title "IT Doesn't Matter" take this as a personal insult, when in fact the statement here refers more to who you report to than it does the actual value of technology-focused roles. All of us have been reading a lot about consumerization. I have seen it a lot myself and assume most have seen this trend first-hand, whether it be people wanting to use their personal devices to access corporate resources, or where it really can be troublesome to IT is when it involves a line of business leader wanting to utilize an XaaS service rather than an internal IT offering, moving strategic dollars out of IT.

I know I have seen a few enterprise systems vendors paint the story that says something to the effect of...'today IT departments are spending 80% of budget on legacy and only 20% on innovation and we can change that to 50% on legacy and 50% in innovation.' And when I hear this, sometimes I wonder what planet this message came from, because the reality for many in IT is that the ability to reduce overhead costs by 30% often would mean a budget cut of 31%. So where does this supposed funding of "innovation" go? While IT budgets and headcounts are often subject to slashing, businesses today continue to spend more than ever on computer-related technology. So this story is true, but the IT group within your company may not always benefit from business technology investments. And the culprit may be different than what many of us had assumed...a lot of us fear a vision of a cloud provider swooping in and replacing our jobs with similar types of services, when in fact the little-known 'business-process-as-a-service' has already been taking technical jobs that used to be the realm of IT for some time, and I think often, with a very positive result, that can be better for everyone involved.

Let's look at your company's HR department for an example. Now, who does your paychecks...chances are, it's a third party. Want a copy of your paystub? Chances are, while you may have gotten your paystub in your own companies intranet in the past, today this service is typically a third-party website. What about your health benefits? Third-party website. What about your 401k...third-party website. I think you get my drift. Now let me ask you, do you think the HR people in your company are less valued by your employer because they often administer third-party services that they don't create themselves? Of course not! These employees are actually tightly aligned with business goals because they pursue a goal of helping the company strategically identify and utilize the best available services out there regardless of the source. They consider carefully whether it is better for their businesses to build their own service offerings or to use external and then thoroughly evaluate available services, a key strategic role.

There are two pervasive mentalities across IT today: one that loves the latest technical details and stays up late nights on the message boards learning the latest and technical details, and another mentality where we feel like 'we have paid a lot of dues and learned a lot from our experience and that should count for something!' As much as the entire world is changing, IT is the epicenter of that change and we have seen more than our fair share of kudos and promotions go to the young kid because he doesn't have a family and can stay up all night learning the latest details of this year's technology that will be completely useless by next year!' I imagine many of us have felt this way, and the good news is that, the HR analogy above has the answer to both of these dilemmas.

The problem has arisen largely through nobody's fault, rather just the process of learning and growing - but companies have had no choice but to employ a lot of roles they consider non-strategic overhead. And even if a company is completely fine with their spending in this area, it simply isn't great for any employee to have to be in a non-strategic role for a company. I used to work for a huge telecom company in a division that re-sold enterprise networking gear. My division did exceptionally well in many ways, but at the time it was not part of the company's core business and ultimately was non-strategic to the top leaders. After a few years of having the division jerked around and treated like the red-headed stepchild, I left, and shortly after they laid off most of the division. But if you consider the new forms of flatter organizational structures, they are based on the principle that a company that is holistically dedicated to providing a specific service will probably do a better job than a company where the service is not core to a company's main strategy. And there is a lot of real data to back this model up. And think about it, if a company uses a third-party service for the things they consider non-strategic, then that means that the employees of said company will be focused on tasks that are strategically aligned with the business, a big win for employees. And further, the employee who works to provide the third-party service gets to work for a company that is strategically dedicated to providing that service. That's another win for the employee.

If an HR supplier to your business is able to provide the same services to multiple businesses then it provides economies of scale, and it also provides tremendous incentive for the HR supplier to invest heavily in improving their own service offerings. No more argument about whether you can get budget to do things you know need to be done. For this business model, the operations have to be run properly or they will lose to competitors. The employees of the HR specialist now get to work for a company that really cares about the HR services they provide not just on a personal level but on a strategic level, the company and its employees are aligned in their mission and purpose. Technical excellence is a key strategic goal of this business model.

So if you are the type who loves deep technical details and are working for a typical enterprise, you may be building what to them would be like a fleet of Ferraris for a grocery delivery service. You may feel that your job today is to simply do the best technology implementation you can possibly do, but for most businesses, this may be a misalignment. If your goals are not aligned with your company's, your company may not really appreciate your effort, or, worse, they may see it as a waste, and nothing is a bigger morale killer than this seemingly terribly ungrateful attitude for your hard work. But the good news is that the new cloud model can now afford a nearly unlimited level of scrutiny and 'tricking out' of technology architectures, and these type of roles are becoming a big growth segment in technology jobs.

Now, let's consider the other mindset; the person who wants to be valued for experience and not judged by their ability to keep up with the latest technical ins and outs. If you relate to these concerns, the HR analogy should give you a huge sigh of relief. The job of today's HR specialist is essentially to strategically manage a service catalog, and industry trends will enable IT to experience these same benefits. It is inevitable that capitalism and free market economics will ensure that, over time, every role in production-oriented businesses will have a six-sigma level of scrutiny, and the good news is, if you are overseeing a service, it is your job to crack the whip and not to be the recipient of the whip cracking. Managing a service catalog is exactly the type of role that will give you the attributes you want, a role where your experience is valued, where continuing education is part of the job, and where you are strategically aligned with and valued by your business.

Now if you are in IT, ask yourself honestly, if someone were to ask you whether a new business application should run on your own internal infrastructure or a publicly hosted cloud, would you really be able to analyze this objectively? Don't get me wrong, internally hosted may actually be better - but business leaders often feel that their IT departments are not really giving alternative services an equal evaluation and really helping the business to determine the actual best options for a business to provide a certain service. I have been in the place of working in a business unit that is responsible for designing and selling the core products and services that make sure the company can generate revenue. And I have been in past positions where I knew my business unit needed to rapidly adopt a new technology to be able to compete effectively and then gone to internal IT only to hear that they can get to the project way after I need it at a budget that is much larger than that of an XaaS provider. And the only way around this is often highly political internal escalation, which is a key reason XaaS can often seem like a simpler path for many business leaders. Often there are really good reasons, but the message isn't always getting through. This specific experience is something I have found resonates deeply with a LOT of business leaders. But how often does internal IT look at this and say to the business leader, 'you know what, you are right, my job is to ensure my business gets the best possible value and lowest overhead for this service, so internal IT would like to help you evaluate these offerings.' And if we choose not to really take a hard and honest look at what is really best for the business, we help to strengthen the argument against IT.

Often we are concerned that if a third party does some things that internal IT used to do, that will mean downsizing, but this is often not the case. Do you remember why we transitioned away from DLSW+ and SNA, token ring, atm etc? It's because they were all complex, and we wanted things to be simpler. And Ethernet is simpler, but that simplicity isn't needed for the sake of simplicity itself; it is needed to make way for more and more use of information technology in every aspect of how our businesses operate. Always remember, even though some aspects of IT are becoming automated, your business's overall dependence on technology is growing. Your company's organizational structure is probably similar to how it looked 50 years ago at the surface, but consider that today technology is no longer as separate from business as it was then. If someone wants to become a marketing director, they go to school for marketing, and today that means learning about the latest marketing software applications. The same is true for HR, and nearly every single other role in existence. And so it is understandable that today these leaders want to take a more active role in selecting their technology as now it is among the most strategic parts of how they fulfill their roles. But do you really think they want to be doing all the work of interviewing and analyzing the details of different offerings and ensuring compliance with corporate standards and centralized service catalogs and so on? Just because business leaders are sometimes going to the cloud, it isn't because they want to manage these services, they are just frustrated that they often only get one answer from IT and it is often not a compelling answer.

Today IT must be aware that simply being IT does not mean you will get the funding for technology initiatives. Today, IT must compete for these dollars. There is so much strategic work for IT in managing these services and invigorating processes and company culture and there is more than ample opportunity in most organizations to completely transform IT without shedding jobs. Like in the example I gave of my first senior networking job, for me demonstrating that I could automate and commoditize much of the role I was hired to do allowed me to personally benefit from the notion that a reduction in legacy spending could translate into investments in innovation. Much like I would have to do as an entrepreneur, I had to first prove that I could innovate in the way the business valued, and then once I was seen as an innovator, only then was I worthy of this investment. Today, our businesses need 'intrapraneur's' more than ever, as without proactive engagement from employees they will never get the agility needed to survive.

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