Internal IT Departments May Be a Thing of the Past

Has Technology Outgrown the Internal IT Department?

A distinct IT department may once have served its purpose, says Joe Peppard in The Wall Street Journal, but technology utilization now requires a decentralized approach, a different way of measuring success, and a whole new structure. Is he onto something?  

Rethinking Internal IT As Distributed, Not Centralized 

“Having an IT department is exactly what will prevent companies from being innovative, agile, customer-focused and digitally transformed,” Peppard writes. These siloed teams don’t meet the needs of a digital-first world, he says. And now that technology has infiltrated (and become essential to) just about every work function, the old way may actually inhibit progress.  

IT teams under this model are viewed as suppliers rather than facilitators of success. Meanwhile, they’re measured on metrics totally unrelated to desired business outcomes and beholden to budgets set in stone too many moons ago to be relevant as technology and teams develop.   

His suggestion? Forgetting a separate IT department and bringing IT into every business unit so that the structure “organizes employee groups around missions . . . and the company is able to embed technology know-how in each of these areas.” Because more and more organizations rely on cloud computing rather than hardware and software, the traditional function of an IT department has dissipated, and applying technology knowledge within focused teams creates a greater sense of ownership, as well as a more direct application of resources.  

Embedding tech minds into discrete teams, Peppard writes, “fuses work relationships across internal teams to foster faster decision-making, greater visibility and shared ownership. And no handoffs to slow down work.” 

Faster, more integrated technology input sounds dreamy. So what’s the bigger picture? We talked with Resultant Senior Solutions Architect Ryan Gould about his view on the embedded technology expert approach.  

Finding IT Success Takes More Than Distributing Resources 

What works for one organization may be drastically wrong for another, and that’s true for IT departments, which Gould points out work great in some instances: “A leadership team that thinks long term will build the right technology leadership, empower IT with a seat at the business strategy table, and think about technology as a center for value creation rather than a black hole for budget.”  

For those organizations that prefer to institute distributed technology by division, Gould points out that an effective technology leader is still critical, otherwise “you risk missing out on innovation, especially across teams, and there is a risk of duplicative efforts that can get expensive quickly, especially with SaaS proliferating so rampantly.” Also, without aligned technology leadership and strong data strategy, insight suffers, and data may become cumbersome or even problematic.   

For Gould, the most valuable point is that organizations would be wise to refocus how they measure a technology department’s success. He recommends bucketing those goals into 1) operational objectives that address key measurable IT benchmarks, customer satisfaction, and budget, and 2) cultural, strategic goals that may shift every few months based on changing business needs. This approach not only helps technology become more strategic and integrated but adaptable, and it drives better outcomes.  

And, bottom line, “you still need an IT team who can handle the very technical day-to-day physical needs of IT,” Gould says.  

Ditching the Internal IT Department Won’t Work Magic 

So maybe breaking up the band entirely isn’t the answer. Still, there’s no denying that technology realities have shifted and created a new set of needs that an internal IT department may struggle to address. It’s more complex, requires greater specialization, and has moved significantly from the old data center and on-site server days.    

Gould urges organizations to consider three facets of this new reality as they consider how to go forward successfully:  

  • Successful technology teams need to be able to quarterback all the intersections among clients, vendors, employees, departments, shareholders, leadership, and so on. Which makes the multisource service integration (MSI) model critical for success.  
  • Subject matter expertise is growing horizontally and vertically, creating new technology disciplines every day without always replacing the need for those disciplines that already exist.  
  • One internal IT department is hard pressed to solve both of these challenges alone, whether they’re concentrated on one team or dispersed, which makes an outside partner exceptionally valuable.  

We’ve helped clients find success with a holistic IT strategy that integrates technology into their big pictures, across divisions and in support of their strategies.  

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