Tech Talk: The Future of IT

As much as this longtime industry observer's eyes roll at that big, over-used term, it genuinely seems to apply to IT functions across most if not all industries. Yesterday, IT functions received requests from the controller to implement an enterprise resource planning (ERP) system, the sales vice president regarding the next sales force automation (SFA)
upgrade or the COO regarding help desk improvements.

Today, leading CIOs are guiding strategy sessions while proposing ways to re-imagine the automobile driver's experience, automate vast mining operations, develop the hospital of the future, comb the social sphere for unstructured data that helps produce new revenue streams and much, much more. CIOs have an opportunity to show the business "the art of the possible," says Chris Curran, chief technologist for PwC's advisory practice.

"The ground is shifting out from under most enterprise technology functions," asserts Gary Curtis, chief technology strategist at Accenture. The combination of ubiquitous connectivity, an endless data supply, powerful handheld computational devises, and powerful analytics "changes everything" Curtis continues. "Given that these fundamental changes are technology-driven, they are dramatically changing the expectations for CIOs. In many companies, and probably in most large companies, CIOs have the most mission-critical job by any reasonable definition."

The pressures bearing down on CIOs—including cost-reduction, making sense of revolutionary new technology, the friction of legacy systems, dramatically changing technology usage and expectations throughout the workforce, growing "lights-on" requirements in the face of growing disruption threats and more—seem hyper-unreasonable.

Yesterday's role as an IT order-taker for a stable set of customers now seems quaint. "IT must take an increasingly broader view of its role and the environments in which it operates," observes Rudy Puryear, the global head of Bain & Company's information technology practice.

The unreasonable nature of the CIO's challenges and the IT function's expanding role help explain why technology consultants are busy. Sustaining this work as a trusted transformational partner depends not only on delivering on current requests for help but also on understanding the drivers behind these needs and the future technologies, changes and opportunities they will foster.

What Clients Want
The immediate requests for IT consulting are both alluring and complex, consultants report. Puryear reports that clients seek out "consultants who can operate at the intersection of business and technology; focus on alignment and effective decision making; and help IT be at true partner with the business."

The importance of understanding the interplay of business (i.e., how strategic objectives can be executed) and technology is evident in the type of IT consulting work currently in high demand. Matt Bishop, a principal for KPMG's CIO advisory practice, explains that CIOs are "looking for consultancies to provide assistance that is broader in scope and more transformational in nature."

Specifically, Bishop reports that the following IT consulting services are in high demand:

1. Business and IT strategy alignment: Conducting enterprise-wide business process assessment and engineering focused on enhanced performance and operational excellence with greater business agility;
2. Enterprise-wide IT service integration: Holistically defining and managing the myriad of services, processes and technologies to ensure end-to-end quality and reliable delivery of all external and internal services to the business;
3. Information and data-driven systems alignment: Managing the exponential growth in information and data as a core asset to the enterprise, and integrating traditional business intelligence (BI) and predictive analytics to transform insight and opportunity into action;
4. Integrated architecture: Leveraging both cloud and traditional solutions to bring faster deployment and more manageable applications, and utilizing streamlined methods and tools to address the complexities of integration within and between distributed architectures;
5. Technology-enabled business processes: Designing and implementing enterprise capabilities that are empowered by flexible lower cost solutions.

IT and CIO clients want help with just about every facet of IT and the increasingly busy IT-business intersection. Given the comprehensive nature of their needs, it is not surprising that strategy firms describe similar requests. Bain's Puryear says CIOs and their teams are looking for assistance in:

• Understanding the gaps between existing IT systems and IT capabilities, and where IT needs to be to support the business of the future (and plotting roadmaps to eliminate those gaps);
• Improving alignment, prioritization, effective decision-making, and governance;
• Identifying ways to do more with less while addressing the "nagging complexity problem that drags down IT productivity and effectiveness;" and,
• Quickly learning about and making investment decisions related to new technologies that they cannot keep up with on their own.

These similarities are also nudging technology and strategy consultants into each other's traditional territories. Some strategy firms are drifting deeper into the technology implementation space while some technology firms are becoming more focused on helping clients build specific strategic capabilities.

CIOs Have to Look In the Mirror
Puryear's point that CIOs and their senior teams need help learning about new technology seems surprising—at least outside the realm of IT departments. After all, isn't new technology a core component of the IT function's role?

The answer: Yes, but there is no way any IT function can keep up right now given the speed of technological advancements and their other challenges—begs a related and more important question confronting CIOs: Are you a lights-on CIO (i.e., and order-taker) or a strategic business partner (an internal consultant)?

"I think the most fundamental IT question is whether organizations and their leadership want to embrace the CIO as a market-facing innovator or treat the IT function as a utility that builds the platform that supports the business," says Curran. IT functions that fulfill the market-facing innovator role (in addition to keeping the lights on) are "looking more to be taught how to catch fish rather than be given a fish,'" notes Puryear.

CEOs and CIOs are not the only organizational citizens asking sensitive questions about the IT function's identity. Every day, more employees throughout the enterprise shrug off the traditional IT role by conducting more business over their own smartphones and tablets. C-level colleagues like the chief marketing officer (CMO) are growing tired of seeing their technology investment requests linger on the IT priority list.

In response, some CMOs are forging their own relationships with technology vendors and/or campaigning for "chief digital officers" who can manage market-facing technology while the IT function is relegated to lights-on upkeep.

Curran views these calls for separate chief digital officers as a "big cop out," arguing that most CIOs are ideally suited to take on a greater market-facing role in tandem with their operation role because they know how back-end technology should operate (and what it costs) to support more genuinely front-end systems and applications that ultimately help drive revenue. Curran views the future role of CIOs as internal consultants who complement their traditional "build and deliver" focus by identifying possibilities for applying market-facing technology that drives revenue growth. He believes that this combined role may define "the IT function of the future."

A Complex and Taxing Legacy
Before most IT functions can achieve that future state, CIOs will have to deal with the past—the complex, expensive and infuriating past. Aside from companies that were born in the past few years, most enterprises contend with an increasingly taxing legacy systems environment. Each company's legacy systems environment is unique, but this asset generally contains data that remains critical to the daily functioning of the organization.

These systems must be managed to keep the lights on; they must be understood and bridged to when implementing new technology (e.g., mobile operating systems). These systems do not integrate easily or inexpensively with new technology that the rest of the organization and customers are clamoring for. Yet, these systems exist and, at some point, must be dealt with in less of a reactive way and more of a final-solution way, where possible.

"Legacy systems make it difficult to move into the new world of mobile devices; newer, faster applications; big data and related opportunities," Curtis explains. "This remains an unsolved problem in most companies, and it's unsolved because there's a very, very large amount of legacy, and high dependence on it … there's really no textbook solution."

Every company's legacy is different, but every legacy figures as an albatross around the IT department's neck. What's more, CIOs are reluctant to talk about the legacy tax they pay every day in the form of slower response times, and opportunity costs. This is the case because they are under so much pressure related to deliver times, keeping IT costs down and, in some cases, enabling business transformation. That said, Curtis says that more CIOs "are looking for ways, for the first time ever, to truly get rid of their legacy—I mean get it out of house altogether, not just in the sense of who works on it and in which part of the world, but to decommission the legacy code."

Accenture and other large technology firms are finding CIOs more willing to talk about the legacy problem and to discuss ultimate solutions to it. Helping clients eliminate the legacy problem is not sexy work, but it'll be necessary work.

"If you took a completely anonymous poll of large enterprise CIOs … and asked them 'What's the number one thing you'd like to do in your environment?' " Curtis adds, "I believe that decommissioning legacy would be probably number one, and certainly within the top three responses."

Technology Today
Appropriately enough, the need to address legacy systems may stimulate the development of new technology. When asked to look into his crystal ball to identify yet-to-emerge technologies, Puryear describes a legacy solution in the form of "technologies that address the growing IT complexity problem (and eliminate the negative aspects of legacy systems) through rapid evolution from old legacy systems to new, more state-of-the-art systems or providing a way to wrap or encapsulate legacy systems."

More familiar emerging technologies still figure prominently in other consultants' responses to the question of what they expect to drive the most change down the road:

• Mobile: The rapid adoption of smartphones, tablets and related  devices requires IT functions to equip these devices with the data, links to existing information systems (including those accessed via cloud technologies) and security necessary to deliver increasingly mobile end users the information they desire. The already pervasive "work anywhere" mind set will only grow, "requiring the right information, delivered the right way to the right people," notes Bishop.
• Social: Social media adoption—in the form of client-facing applications and internal collaborative tools, will continue to influence IT, according to Bishop and others
• Data: As supplies of organizational data move from "big" to "seemingly endless," IT functions need to create and buy tools that harness data into information.
• Consumerization: Today, the term "consumerization" usually describes intensifying expectations about IT delivery from the rest of the workforce along with the management and security challenges that arise as employees bring their own hardware (smartphones) and software (apps) to work. Tomorrow, IT functions will treat this dynamic as more of an opportunity and less of a threat. "Imagine having an enterprise app store," Russo suggests, "where employees can download the app they need when they need it … with a much higher degree of self-service."

These and other cutting-edge technologies (e.g., cloud, GPS chips, wireless connectivity) also will be integrated in ways that lead to more transformative business opportunities, according to IT consultants. Making devices "intelligent" through wireless and diagnostic chips embedded in aircraft engines, automobiles, appliances and industrial machines will give rise to a riot of new service lines of business. "If your car can tell your technician what's wrong with it via remote diagnostics before you bring it to the shop, the service obviously will be conducted much more effectively," Russo explains.

This type of industrial Internet innovation, however, requires CIOs and IT departments that are not buckling under the weight of legacy systems and reactive order-taking, but are instead spearheading strategic discussions about the art of the possible.

The IT Consultant of the Future
Nurturing IT to that evolutionary point requires help from strategy and technology consultants working with CIOs in an extremely diverse terrain. Consultants will need to help IT executives soul search, support IT functions as they play a central role in transforming the business, mediate a more trusting and aligned relationship among the CIO and other C-level executives, roll up their sleeves and address the staggering cost of legacy systems, spot and analyze emerging technology to determine how it might help the business and end customers.

This variety of work requires IT consultants to move beyond their own traditional role while operating, at different times, as industrial psychologists, life coaches, marriage counselors, traditional system integrators, app developers, security and privacy experts, futurists and trend-spotters and more. It turns out that the consulting work is just as mind-blowing as the challenges confronting CIOs.