It is estimated that IT spending is projected to total $4.2 trillion in 2021, an increate of 8.6% from 2020, according to Gartner. With an upsurge in the number of applications used by the average business user, it has become important to address the fact that these applications aren’t always vetted by the IT department. These business users might not be fully aware of the drawbacks or vulnerabilities of their new tools on an enterprise-wide scale. This is where the IT department can step in and help lead the business users in the right direction. This is called Business-Led IT.
Business-Led IT refers to any technology that is purchased and used outside of the IT department or outside of the CIO’s purview. As business leaders take more decisions regarding the tools and technology to help improve productivity, they are also involving the IT department by taking inputs to better understand how the software could benefit the company on the whole.
This was previously called shadow IT and was considered a problem by the IT department as it allowed employees to use multiple services and vendors without the IT department’s knowledge which could lead to security concerns and confusing data silos. Now, however, shadow IT has been mostly accepted as a driver of innovation in companies and a method of increasing productivity and efficiency within the employees.
Business-led IT needs to be a partnership between the IT department and the business users. The problems that the business users have can be solved by tools that the IT department has in-depth knowledge about. If the IT department acts as a consultant for the business, it can get a holistic understanding of the issue and suggest cutting-edge technology or software which can efficiently and smoothly solve a problem.
While business-led IT also involves the purchase and usage of technology outside the purview of CIOs and IT departments just like shadow IT. But are they both the same? Well, the answer is no. While business-led IT technology is still outside CIO’s purview, with the alignment of business units and IT department, the IT department is aware of its existence and put efforts to mitigate the risks associated with using these technologies. Business-led IT is a deliberate method of distributing I&T efforts and accountability across an organization that is backed by a service-optimized IT operating model and IT governance, at the very least.
The CIO has traditionally been in charge of managing the entire IT department. The CIO oversees the maintenance and improvement of the company’s internal technology and IT infrastructure to ensure maximum productivity and the automation of complex tasks. However, with the recent surge in different tools and applications being utilized by business users outside of the IT department, the scope of the CIO has increased considerably.
In the past, the CIO was the only one who could develop strategies to leverage technology to benefit the company, however, with the amount of increased digital literacy and dexterity in employees, this role is now shared with all of the other business users in the organization. Thus, it’s more pertinent for the CIO to find ways to improve upon the current systems and workflows to become more agile, more reliable, and more profitable.
One of the main roles of the CIO is to remain updated on new technology and software in the market as well as rising technologies to ensure that the company remains on par with its competitors. These new technologies including machine learning, robotic process automation, Internet of Things, etc are cutting-edge technologies that could have a serious positive impact on the overall productivity and efficiency of the company on the whole.
The CIO needs to find a way to integrate these innovative trends into the company’s infrastructure to stay relevant. However, with multiple applications being used by business users on a daily basis, the CIO also needs to keep a close eye on these apps to prevent any data leaks or security breaches.
The CIO is also in charge of creating custom applications to help boost productivity using personalized interfaces and controls. The best practices regarding anything IT-related also need to be determined by the CIO to provide a manual or guide for business users in the enterprise. The entire IT budget is also controlled by the CIO, who gets the final say on what software or hardware can be purchased within the company.
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The tech world is currently full of different applications and vendors to fulfill various needs. This abundance of choice can lead to confusion, especially when deciding between applications that perform similar functions. While the IT department is best equipped to understand which software is best, they don’t generally have a good grasp on what the actual problem is. This is where the business users come in. Business users will always have a better understanding of the problem that they are facing, and this knowledge can help them choose the correct software or vendor for their issue.
Both parties bring different benefits to the table: the business users know their problems, obstacles, and business inside out and the IT department knows which cutting-edge technology can be adapted to solve these problems. If both these parties work together, they can identify a product or software that can solve the issue securely while incorporating newer and better technology into the system.
Understanding business goals across an enterprise can obviously be difficult due to the sheer size of the company. This is why it’s important for the IT department to be spread across business units so that they can see and anticipate future problems and have the solutions ready. It’s no longer enough for the IT department to just keeping the organization running, it also needs to encourage innovation and improvement by keeping an eye out for new technology that could increase productivity and efficiency. This can help the business leaders achieve their KPIs while keeping a technology-forward approach to the inner workings of the organization.
Currently, according to the 2019 Harvey Nash/KPMG CIO survey, around 63% of organizations have technology that is being managed outside of the IT department, which shows the popularity of this trend. Business-led IT can definitely help companies adapt to market changes faster and provide their customers with the exact product or service that they need.
However, Business-Led IT comes with its own risks and disadvantages. With the IT spend being split up into multiple areas of control, there may be more chances of critical information being unsecured or a potential cyber threat in the form of cyber-attacks and hacking. Hence, it’s very important for companies to have proper measures in place to help govern Business-Led IT.
Governing Business-Led IT isn’t as easy as it seems. The biggest advantage of enabling your business leaders to have a say in the technology used by their department is in driving efficiency and increasing the overall productivity of the teams. If IT steps in and takes over after a certain point, this might lead to the loss of the advantages that Business-Led IT can give them. So, it’s definitely important for companies to have a plan in place before introducing Business-Led IT as a viable solution or option to business leaders.
Here are a few tips on how to govern Business-Led IT:
Business-led IT might consist of a lot of decision-making amongst the leaders of the business units and the CIO and other IT employees, however, it’s equally important to have a member of the business unit who can guide the other employees. This member can become a point of contact between the employees in the business unit and the IT department staff and will essentially have a different career path altogether. This individual will have to coordinate with the central IT team and enterprise architects as well as the people within the BU. This individual can also be put in charge of creating an inventory of the solutions being used in the BU along with a short description of the tool and how it is tailored to help solve problems.
This role will have to be developed deliberately as the individual will have to be trained regarding certain competencies such as:
Here are a few more tips on how to ensure that your efforts towards business-led IT in your company prove successful:
Business-Led IT has slowly become a requirement to survive in today’s digital world. No longer are there separate business and technology strategies, there is simply a business strategy that is being backed by technology. This new approach has caused business users and leaders to get much more involved in the technology side of the business. However, there’s reason to believe that this is actually a good thing:
Business-Led IT is the way forward for many companies as developing a synergy between the business and technology side of the organization can lead to great outcomes. Both of the teams working in conjunction with each other could encourage more innovative solutions and implementation of cutting-edge technology to solve the customer’s problems. Generally, business users use cloud-based tools and applications that may help with automating repetitive tasks or increase efficiency. The IT team can help them find secure applications that can help business users with their work while avoiding vulnerabilities in terms of security.
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