The way companies buy, deploy, manage and use digital technology has slowly changed over the past 20+ years because of new consumption models like software as a service (SaaS) and cloud computing.
IT and the digital transformation
The financial crisis of 2008 accelerated the move to the public cloud and saw “as a service” technology consumption models become mainstream. The Covid-19 crisis redefined the broader business digital transformation as companies had little-to-no choice in moving to a distributed workforce and deploying a digital customer experience.
The widespread use of SaaS and public cloud resulted in a shift in buyer decision making. The ease of purchasing and deploying SaaS applications shifted control from IT to the line of business leaders causing a proliferation of SaaS applications across the company. The workforce itself has changed over time as technology knowledge and expertise spread beyond IT departments and is now distributed throughout the business. All of these changes have a direct impact on the role of IT in a modern business.
Historically IT served as the gatekeeper for technology entering the business, often by controlling the IT budget and approval process. The complexity and difficulty of deploying and operating on-premise applications on company-owned and managed infrastructure made going around the IT organization very difficult, and supported a centralized model of control.
The roots of this model go all the way back to the first generation of business applications that were operated on mainframe computers and made available to business users on “dumb” terminals. The only way to operate in this environment was with centralized control. In the 90s, as client-server systems became the prevailing operating model, this centralized model was much more difficult to execute and led to shadow IT organizations springing up across companies.
Moving to the cloud model provided companies the opportunity to take advantage of both the centralized “control” of a consistent and approved platform, but with decentralized control of business applications, in effect moving shadow IT out of the shadows.
What is the new role of IT?
In this hybrid management model, what is the role of IT? As IT moves away from a gatekeeper role they must learn how to become a collaborator and trusted business partner.
In a SaaS and cloud-enabled digital business, IT moves to a value based service broker role, providing infrastructure, help desk, security, cloud application custom development on the selected platform as a service (PaaS), SaaS selection advice and support, change management and strategic business advice.
Thinking of IT as a service broker and strategic business partner opens up the opportunity to collaborate with the rest of the company to ensure that the company maximizes the selection, deployment and optimization of the digital tools that are critical to the modern business. The modern IT department, while still minimizing technical risk moves into the role of minimizing business risk. To fill this role the IT analysts need specific business expertise and knowledge. As a strategic business partner, the role of IT is to empower the business users to be successful.
Security needs to be the responsibility of the entire business to be successful. The role of IT though, is critical to minimizing risks and protecting the business from the myriad of threats that plague businesses today.
Everything from ransomware to AI empowered attacks mean that the level of sophistication and complexity of the solutions required to effectively protect the business will only continue to increase. The need to educate the entire business on the threats and the steps they can take to protect the company and its data create means that IT must also serve as educator and subject matter expert for the whole business.
Horizontal applications often fall short of meeting 100% of the business’ needs and generally require configuration and customization to close feature or function gaps. Industry clouds, while offering better industry vertical fit, still often need additional work to incorporate the specific processes that can be a competitive differentiator for the business. Cloud platforms provide the foundation for this work, and IT needs the skill and expertise to work with the business to define, build and deploy the critical gap filling applications.
Building on cloud platforms offers:
Faster time to value
Easier deployment and administration
Integration capabilities to prevent / eliminate data silos
Differentiation and strategic value
Data is the fuel for the modern business. IT plays a vital role in making the “right” data available to the “right” people when they need it. Key activities include:
Integration across the many data silos created by the proliferation of SaaS applications
Ensuring data is clean and in a usable format
Providing analysis tools and ensuring proper access by role and individual
Security and privacy, including compliance with the many emerging governmental privacy regulations including the European Union’s General Data Protection Regulation (GDPR) and California’s Consumer Privacy Act (CCPA)
The role of IT in providing change management expertise does not change in a SaaS or Cloud environment. New and upgraded applications often drive process and organizational change. Individuals, teams and organizations have to adapt to these changes to realize the business benefits of the technology. IT, particularly in its service broker role, continues to be the logical provider for change management services.
The need for a more centralized approach
With the proliferation of SaaS applications across the business there is a need for a more centralized approach for management and optimization. Spend management falls to finance organizations, but managing spend alone isn’t enough. Ensuring compliance and meeting security standards is a role that IT should play. It’s also important to catalog the SaaS apps in use across the business and gauge the actual use and adoption.
Understanding usage and adoption can let IT advise the business on unused and unneeded apps and work with IT to optimize spend. To assist in the management of SaaS applications many organizations turn to SaaS spend management software. These applications track the apps across the business and provide tools for IT, Finance, Procurement, Operations and HR to help the business choose and use the best SaaS tools for its specific business needs.
Want to get started using a SaaS spend management tool? Check out G2 Track for FREE today!
Michael is an experienced technology executive with a diverse software background that includes experience as a software company executive and leading a premier marketing research team. Michael is a published author, blogger, photographer, and accomplished public speaker on emerging trends in business software, digital transformation, and customer experience strategies.
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