For example, the sales director who wants to improve customer relationship management (CRM) can now go straight to SalesForce.com and buy a complete suite of mature CRM processes as a service. If that sales director approached the IT department for the same solution the time frame for delivery and realizing the business benefit would be considerably longer. The overall cost would also be much higher and the complexity far greater.
Just like the consumer, business leaders are thinking more about the service they need and less about the underlying technology required to deliver it. And just like consumers, organisations are increasingly defining themselves by the service they use. They are transforming themselves into a Service Defined Enterprise (SDE).
The Services Defined Enterprise has to be more agile because it is able to consume the services it needs from the most efficient and appropriate source.
That source will be the provider, internal or external, that can deliver the most appropriate service to the organisation or line of business at the most acceptable cost, speed and risk.
The Service Defined Enterprise will view technology as a powerful tool in delivering the capability it needs. And that capability will not be delivered via a complex underlying infrastructure within the organisation's data centre. It will be delivered without the organisation even knowing or caring that it has a data centre
What are the new opportunities for the CIO?
The SDE will have the freedom to consider services from any source. This heralds a fundamental shift in the IT acquisition process and creates two significant opportunities for the CIO.
Firstly, to transform how the IT department builds and operates the IT infrastructure and systems under its control so it becomes as agile and cost-efficient as an external services provider. This will enable the department to maintain its position as one of the primary providers of internal IT services.
Secondly, for IT to establish itself as the trusted advisor to define, source, engage with and manage external service providers in order to maintain and develop the organisation's portfolio of IT services and capabilities.
The IT department will need to adapt in order to assume the identity of a pseudo service provider. The aim is not simply to become comparable to external service rivals, but to become the arbitrator of what service standards and capabilities are most needed and which provider is best positioned to deliver them.
In the Service Defined Enterprise, IT will continue to own and operate enterprise architectures, business process and productivity applications, its primary focus will shift from technology management to the delivery of business relevant IT related services.
It will not, however, abandon its expertise in running business technology. Instead it will confine its remit to building and managing those technologies and activities that the business wants or trusts only it to deliver. While the SDE will still build and operate many key IT assets; networks, servers, storage, ERP systems, it will do this in the style of a service provider.
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