Retooling the IT Organization

Thanks to marketing and competition gurus, disruptive innovation, both famous and infamous in I.T. circles, is usually noticed first more on the front face of organizations than in the back office.

But that's not a bad thing: it is a natural outcome of the track of activity that stretches from invention to implementation. The front face of an organization is where growth is decided, dealing with opportunities and threats by creatively linking strategy and ROI. To nurture the link and its importance, policies (a very fancy way of saying priorities) go into effect.

Meanwhile, a competing track runs differently -- from experimentation to adoption -- and has a different outcome. The back office makes decisions about how ideas will in fact be sustainable enough to give ROI a chance. In this track, what is affected is actual practices. To keep up with the pressure of policies and ROI, organizations operationalize themselves by incorporating tools into procedures for managing operations more predictably. Predictability sets a stage for detecting the difference between what often works under pressure, and what often doesn't. Technology adoption signals either a belief that things can be made to work better, or a conclusion that they cannot be allowed to work worse. But these days, as always, there is a lot of experimentation going on first.

One of the most dramatic side effects of the innovation called Virtualization is that organizations built to exploit certain kinds of resource capacity are being disrupted. Literally, the structure of responsibilities, accountabilities, consultations/cooperations and information -- sometimes called RACI -- has been designed for predictability about certain things, and virtualization is removing many of those same things from the actual practice of daily operations.

I.T. organizations generate their own business value largely through being able to achieve a level of Performance, a level of Control, and a sustained level of attention to both (Compliance), all within the budget -- or in other words, at a target operational Cost.

But a major emerging issue in IT organizations is the struggle to regain predictability when virtualization -- mainly a software and configuration phenomenon -- has removed many practice constraints from overall (systems) technology performance and technology control, leaping beyond established norms of compliance, and obsoleting the already-implemented models of cost that have survived business approval processes.

IT organizations are inspired, by apparent cost "advantages", to experiment with the invention of virtualization. But this can very rapidly create operational effects beyond existing methods of control. By analogy, in sports, a coach fantasizes about having a superstar athlete, but agonizes if and when the star unilaterally renders much of the game planning and much of the roster unusable. Under these conditions, keeping the star can mean redesigning plays, rebuilding rosters, or even challenging the existing rules and conditions of play. On the other hand, the best coaches make the player fit a role and get rid of him if he can't fill it.

For the IT organization that wants to implement virtualization, the approach to draw from the above is twofold.

One part is to give virtualization a role specifically in context with the rest of operations. This will mean using virtualization to power a defined service, not just to reduce resource costs. Services should be the reason why the business is interested in virtualization, and the business should be telling IT to use virtualization, not vice-versa.

The other part is for the IT organization to not treat virtualization as one of its enabling technologies, but instead to treat compliance management of --and performance management of -- virtualization as the IT organization's needed enabling technologies. These are going to have the effect of changing the RACI of the IT organization.

Punchlines:

Organizations must adapt to what they adopt. Virtualization means that the legacy roles and systems supervised by the IT organization must be reconfigured. The back office needs organizational change management.

To assure that IT operations are integrated with business operations, Virtualization means that the business will assign value to resource capacity -- i.e. assets -- primarily in terms of the impacts on services, making services the key element in the framework for determining ROI.

The good news is that both application development and software compliance management offer abundant lessons already learned, to be transferred over to the systems management arenas as a starting point. The bad news is that so much of what is now known as IT asset management and IT configuration management is based on things that virtualization can easily obsolete, so those essential components of IT management practice will have to be re-engineered, along with the roles that want to carry their names. 

Posted by Malcolm Ryder at 3:48 PM