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Technology: IT Architectures Need Rebuilding to Remain Relevant
Peter Sondergaard, Gartner’s global head of research, warns that “The second recession is about to hit.” He predicts a recession to start impacting IT budgets by late 2011.
To make matters worse, IT budgets are already strapped and aren’t allocating enough money towards adoption of newer technologies — so says Gartner’s Dave Aron, vice president and Gartner Fellow in the CIO Research group . “Globally 67% of the IT budget is spent keeping the lights on, 19% supports growth of current business such as scaling up volume or helping the business enter new markets, Only 14% is allocated to genuine transformational IT.”
IT departments are getting squeezed by both declining budgets and the high cost to maintain their existing infrastructure.
IT departments will have no choice but to become more creative with their budgets and strategy given the challenging climate. The only way to be able to free up money and resources to allocate to new technology is to destroy some of the current IT landscape. Sondergaard says IT groups need to “reimagine” and redefine their departments in order to fit into a “post-modern world” where information, collaboration and mobility dominate. Sondergaard said that “architectures of the last 20 years will be obsolete.”
To explain what needs to be done, Gartner has grabbed onto the phrase ‘creative destruction’. It’s a phrase that has been popping up more frequently to describe recent big events like what’s happening with the ‘Arab Spring‘ movement and the mortgage crisis. But the phrase isn’t new. It’s been nearly 70 years since Austrian-American Economist Joseph Schumpeter coined the term ‘Creative Destruction‘.
In the area of IT, Gartner says ‘creative destruction’ is an apt prescription for what IT departments need to do to adopt to changing business and technology climates. Gartner identifies five areas where IT need to ‘tear up the rule book’ and consider making radical and disruptive changes. Mark McDonald, Executive Vice President at Gartner, summarized these areas:
- IT needs to reassert itself into a more strategic role
- IT needs to level technical and data silos to create greater flexibility
- IT needs to involve staff in newest projects and latest technologies rather than outsource
- IT needs to rebuild internal processes to be less restrictive and allow better governance
- IT needs to use metrics demonstrating business impact rather than whether a job is completed or not
To do this, Sondergaard urged IT managers to “pursue simplicity by putting people and their needs at the center of design. You must dare to employ creative destruction to eliminate legacy, and selectively destroy low impact systems.”
