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IT Organisations Need to Become IT Services Factories

Piti Pramotedham, CA's managing director for Asia South, says IT organizations must retool to become an internal services engine if businesses are to realize the value of their IT investments. "IT needs to become a services factory that can output repeatable processes that the business requires," he said. "At the end of the day, users just want the IT services they use to be available and should not have to worry about whether the network is up or down."

According to Pramotedham, there is a productivity paradox in today's IT organisation where there are more investments in IT but no real increase in output. "In order for business-relevant services to be deployed, IT must be demand-driven by the business and for this happen, the IT organization must become an internal service provider."

The next step is to effectively manage and optimize the bulk of IT services that make up a bulk of the operational expense, added Pramotedham. According to a recent McKinsey report, 75-85% of IT spending is non-discretionary operational expense, which leave only a fraction for strategic IT initiatives. "Optimizing OPEX is the key to releasing more funds to strategic and innovative use."

While good IT governance can help boost productivity by aligning IT to the business, Pramotedham notes that in order for this to happen, "The CIO must have a clear role and empowerment from the CEO or CFO to own and optimize IT and, importantly, communicate the tangible benefits that are resulting from IT investments to the business leaders".

"The new CIO must show the business what business benefits are emerging from the IT organization," added Pramotedham. "Everyone has access to the same technology, but having a good CIO with a clear understanding of how technology can support the business can make all the difference to how IT is applied and the returns it can give."

Pramotedham emphasized that, "The priority must be the information, while IT systems and processes should be designed to serve the information asset in terms of providing access, availability and appropriate security controls" he said "Once a CIO takes ownership of the information, it is easier to define the IT architecture required to support it."


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