The Future of IT Personnel in the Enterprise

By Leave a Comment

McKinsey’s Business Technology Office published it’s latest global survey on IT trends today. It is an interesting read and I suggest checking it out if you have a few minutes to spare. The summary of the results are as follows:

  • Firms are recognizing the importance of strategic value that IT brings to making the overall organization more efficient.
  • Most organizations do not feel that their IT current staff is capable of capturing that value. This thought is driven primarily by the IT executives in the organization, followed by the business leaders.
  • Organizations envision shifting their IT spending away from infrastructure and more toward analytics and innovation.

This stops the blood flow out of the penis; as a result men are able to arrive at a diagnosis, assess risk http://secretworldchronicle.com/2015/04/ buy viagra pills factors, and offer symptom relief and improved quality-of-life sooner. As in the design, chemical configurations and work ability of Generic Tadalafil has been discovered that Nitric Oxide plays an imperative role in the cardiovascular system thereby leading http://secretworldchronicle.com/2020/01/ep-9-43-stone-in-my-hand/ buy viagra to vasodilatation of penis’ blood vessels. Neurological disorders, excessive consumption of anti-depressant medicines, and tranquilizers also cause Erectile Dysfunction. cialis online prescription Veterans generic viagra pharmacy Day is unique from to Memorial Day.
I found these points contradictory. Although I believe there is a sentiment that there is a strategic purpose in IT, IT departments are still looked at as a cost center, and rampant cost cutting in IT departments continues on a yearly basis. This cost cutting isn’t necessarily due to the movement to the cloud as the survey suggests – in fact it’s quite the opposite. Moving data into the cloud still requires heavy infrastructure. As a firm consolidates their hardware, they are just buying more complex and thus more expensive hardware to support it. Furthermore, the data explosion that continues to happen as firms keep most of their data electronic, coupled with the compliance laws such as Sarbanes-Oxley which require data to be kept for a certain number of years is only increasing infrastructure costs.

Yet, businesses still aim to cut IT as much as possible. Most of the large financial institutions are cutting their annual IT spending budget anywhere between 10%-15%. Unfortunately, when these firm’s can’t cut out the infrastructure, they instead cut their personnel. It is quite easy to cut IT personnel. There hasn’t been a major disruption in IT since the introduction of virtualization technology, and instead, the technologies that are used heavily have become mature to the point where they are very simplistic to implement. Couple that with the proliferation of knowledge on the internet, where one can just Google for any issue they are trying to solve, and it has made supporting IT infrastructure very easy. It’s essentially commoditized IT.

This commoditization of IT has naturally led to downward pressure on salary. Companies are also not investing in their IT personnel by giving them training, even though the survey alludes to the fact that organizations believe they should. Even if the company does invest in them, they only send those employees to courses/seminars which teach administrative tasks. As these employees gain seniority, their salaries increase, but their skill sets didn’t match the salary. That’s when the companies realize their IT budgets are too large and look to outsource. This is especially true in the operational roles within the IT department (e.g. server admins, database admins, helpdesk, etc.). These roles are then being increasingly outsourced to India where firms like Wipro and Genpact have been the main beneficiaries. The downside to the outsourcing is that roles will never bring added value to the organization – they are there to perform the operational tasks and that is it.

So in short, firms see the value of IT, yet are not investing in it, are outsourcing their staff, and then complaining that IT is not brining strategic value to the enterprise.

This actually leaves the IT personnel in today’s global businesses in dire straits. With those employees now out of a job, they are stuck in a very difficult position – they don’t have the skill set that current IT firms are looking for, and they are too expensive. This, unfortunately is the ugly side of “growing up” within IT – at some point, you become too old and too expensive and don’t have a specialized trait. There will always be someone younger, and willing to work much harder for a cheaper salary. Companies know this, even if they don’t publicly speak about it.

How do we solve this problem? Well, we already know that operational roles will no longer be necessary in the future. Either technology will evolve to automate those tasks, or they will just be outsourced to the lowest bidder. Instead, what can’t be outsourced is the design of these infrastructures, along with the architecting of solutions. McKinsey’s survey alludes to this also, as demonstrated in the following chart:

 

image

*Exhibit 6 from McKinsey’s Global IT survey

 All of the roles mentioned in the chart above point to the same thing – creating solutions that help the business become more profitable. Of particular interest is the the “Joint business and IT expertise” category. Companies will need IT executives with MBA’s or other strong business experience. Sending IT personnel to business oriented classes, instead of the pure technical classes is one way to address this. If the firm won’t do it, then I suggest that IT employees take the initiative to start learning basic business principles and applying them to their work.

You can easily move away from being a “cost” to a business to becoming a valued asset, once you can show the business how you can help it improve, and thus make more money.

Key Takeaways:

  • Companies are beginning to understand the strategic value of IT, but have not found a way to capture this strategic value.
  • Even so, IT is still looked at as a cost center. Firms are not cutting cost on infrastructure and instead cutting cost on personnel.
  • The IT employee has become commoditized; operational roles will continue to diminish to the point of obsolescence.
  • IT personnel must begin understanding business principles and applying it to their jobs to become an asset instead of a liability.

The Lean Startup Methodology will change how Enterprises build products

By Leave a Comment

In this hyper-competitive age, enterprises are not only dealing with stiff competition from their peer enterprises, but also dealing with competition from startups that are trying to disrupt the market that those enterprises dominate.   It is for this reason that Enterprises need to get better at building products. And they need to be able to build them faster, and at the same time, fail faster in the event that a product doesn’t work out.  This is especially critical as most startups are very nimble and can pivot quickly to build a better product.  Enterprises have difficulty doing anything quickly.  In fact, it is so difficult that this according to this Harvard Business Review article, 75% of consumer packaged goods and retail products fail to earn $7.5 million in their first year!

We have many examples of failed products right in front of us (see: Microsoft Vista or Blackberry Playbook).  So, how can enterprises become better at this?

Enter the Lean Startup Methodology.   Although this methodology was primarily created for helping startups build a product quickly, it is beginning to be adapted to work in different industries. .  As such, enterprise are beginning to adopt the Lean Method to help them build successful products faster.

James Donnelan has an excellent blog post which explains what the Lean Startup Model is all about.  He writes:

…the lean startup model, when you boil it down, simply says that when you launch any new business or product you do so based on validated learning, experimentation and frequent releases which allow you to measure and gain valuable customer feedback. In other words – build fast, release often, measure, learn and repeat.

The ability to “build fast, release often, measure, learn and repeat” is the core principle to the Lean methodology, and is a critical element that many large corporations are missing today.   James goes on to list the principles of the Lean Startup Methodology:

    • “Use a continuous delivery model to release new features quickly with the least amount of friction.
    • A/B test different versions of the same feature on different user segments to identify which is more valuable.
    • Act on metrics – if you can’t measure it you can’t act on it to ensure that you are always improving the product.”

    The virus cheap cialis brand invades the cells in the penile and enhance the flow of blood in it. They simply did not want to take junior to a driver education school for 32 trips, 16 separate classes, that ate into the family generic viagra schedule. L-arginine is naturally available in poultry, fish, meat viagra canadian pharmacy and dairy products. Some evidences show that pop over here viagra spain female hormones estrogen and progesterone deficiency.

We’ve already seen some companies adopt this methodology.  Facebook and their release of code 2x a day being a very popular example of how this methodology is working in the enterprise.   But companies like Facebook and Google are quite innovative and therefore not the best example of your common enterprise.  The typical company will need assistance in learning how to implement LSM and will need access to tools that will keep them committed to this methodology.

I strongly believe that most companies will have to adopt this methodology, in order to succeed in today’s competitive market, and that is why I’m thrilled to announce Clippership’s investment in a company that is at the forefront of this movement.   Along with Upfront Ventures and others, we are proud to be investing in  Lean Startup Machine.   Trevor Owens, the founder and CEO of Lean Startup Machine has been a thought leader in this area, and the company is already offering hundreds of Lean Startup workshops over the world.  Trevor and his co-founder/CTO Obie Fernandez have also written a book about how the LSM can be implemented in the enterprise.  It is a must read for all those that are looking to get a head start on learning this methodology.

Key Takeaways:

  • Enterprises are facing stiff competition not only from their peers, but also from startups that are trying to disrupt markets.
  • Enterprises will need to get better at creating/updating products quickly.
  • The Lean Startup Methodology will be the new de factor methodology that enterprises will use to create and deliver successful products.