According to James Surowiecki (The Wisdom of the Crowds) corporations exists because they reduce the cost getting a large number of people work in a coordinated fashion for some future goals and make the future more predictable.Hundred years ago large corporations were vertically organized (e.g. Ford Motor) doing more or less all business activities inside the company. However there are lot of tasks which suppliers can do more effectively and are not in the focus of the value creation of the company. So outsourcing began.
What about IT?. According to many IT has no importance and should be outsourced (see http://www.nicholasgcarr.com/articles/matter.html ). The arguments are straightforward; information technology is now a commodity and should be handled as all technologies before which once were a strategic issue and now are service (e.g. electricity). No wonder employees would like to see IT as something which should be permanently available and not causing any kind of concern. In that sense IT is a cost center and should be managed by controllers.
If we bring that idea to the extreme we shouldn't stop with IT. Only core activities should remain in the company. What is core? .... All businesses are people business. So one of the most important tasks of a company is too acquire, keep and develop talented people and help them to make the best use of their capabilities. So Human Resources are a strategic area.
Back to information technology I inclined to think that it's different from other technologies before. Earlier technical inventions "extended" our physical capabilities, e.g. the steaming engines gave us stronger muscles, the telephone improved our hearing while electric light and television our eyes. IT is different, because it extends our brain; computing capabilities, memory, data management and communication. Unfortunately the brain needs training to be effective that is why we have to think and invest in IT to have the best use of it. Information technology - if used well - is an innovation enabler.
On the other hand as technology evolves it is getting more and more simpler to use and turns into commodity. It's like a bathtub; new solutions are pouring in while older applications and hardware sinks to the bottom and flows out. The task of IT is to manage the bathtub.
According to this model IT is separated in three parts: Development, Operations and Sourcing.
The task of development is to introduce new solutions for employees and customers. To do this it has to cooperate effectively with business. This assumes partnership and not services. Operations forms the new solutions into standard, measurable services and optimize them. Sourcing should hand over these services too suppliers.
If IT does it work well than it keeps operations lean while concentrating on development which drives business. The trick is to hand over solutions to operations as soon as their are ready.
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