Without a doubt, businesses don't run without technology, and business involvement in IT decisions is greater than ever. This move - what Forrester calls the business technology (BT) revolution - is picking up speed as business leaders proactively search for tech-based solutions.
And, as the business sees itself as having more responsibility around these decisions, the nature of the IT's goals, initiatives, and priorities evolves along with it. Understanding this will help IT organisations prepare for the inevitable shift to an environment where IT and business partner in the management and selection of technology.
Recently, Forrester asked over 1,100 IT decision-makers in North America and Europe where the ultimate decision control in choosing, implementing, and managing the relationship with software vendors resides - with a business executive, such as a COO or CFO, or with an IT leader such as a CIO. Although most firms fell somewhere in the middle, more than one-third indicated that either the CIO or a business exec had complete authority. Forrester studied both of these two extremes to see how priorities and goals differed in a technology universe controlled by the business versus by IT.
Forrester found that the importance of each facet of software decision-making differs depending on whether the business or IT has authority. In companies where IT execs had complete authority, software and vendor decisions are more likely to favour implementation and industry experience and customer references.
In contrast, items such as overall cost and completeness of the system carry more weight in business-dominated software decisions. For example, sixty-eight per cent of firms where the business had complete authority over software decisions rated system cost as "very important," 10 percentage points higher than in organisations where IT was making software decisions (see Figure 1, and click to enlarge).
Although the list of priorities is ordered similarly in both extremes, there are differences in exactly how important each priority is to the organisation. In a nutshell, firms in which the business controls software decisions indicated that they will place more emphasis on modernisation objectives, while ensuring IT would be able to meet service objectives - meeting demand, staffing appropriately, and continuing support. They will:
• Expand their use of Software-as-a-Service (SaaS). In firms with business control, 38 per cent felt this initiative was important - most likely because the business wants the quicker time-to-value, ease of implementation, and support outside to save resources for critical projects. Just 24 per cent of firms where IT has complete authority could say the same.
• Update and modernise legacy applications. Some 72 per cent of business-controlled firms felt this was an important initiative - hoping to revitalise existing assets. Only 62 per cent of their traditional IT-influenced counterparts put this initiative at the same level of importance.
• Go green. Forty-eight per cent of the business-led companies believe implementing green technologies is an important initiative for this coming year while only 40 per cent of their counterparts held "green IT" in the same regard (click here to read Forrester analysis on Green IT).
IT must accept and help achieve a new set of business-driven goals
CIOs who don't position IT to support the way business selects and uses technology are fighting against the currents of change. As software decisions move over to a business-driven responsibility, IT organisations will have to learn to cope with these shifts and, in a sense, educate business technology decision-makers with information, advice, and regular reviews to help them make successful software investment decisions. Acting as a partner and leveraging IT's tech experience will keep IT relevant in business' tech choices even as this responsibility moves away from IT. Proactively contributing to the success of these business technology investments builds trust between IT and business executives alike, and ensures that the CIO is not marginalised to a simple support and supply role.
About the author:
For more information on how CIOs can implement Business Technology Leadership Maturity in their 2010 strategic plan see Bobby's recent post on Forrester's CIO blog or his recent complimentary webinar: http://www.forrester.com/businesstechnologywebinar.