Deja Vu: IT may matter, but the IT department may not

Deja Vu: IT may matter, but the IT department may not

Summary: According to Silicon.com's Andy McCue, Gartner has reported that outsourcing, offshoring and the increasing amount of control of IT being handed to business units is leading to the death of the IT department as we know it today.

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TOPICS: Outsourcing
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According to Silicon.com's Andy McCue, Gartner has reported that outsourcing, offshoring and the increasing amount of control of IT being handed to business units is leading to the death of the IT department as we know it today.   Looking to anecdotally confirm Gartner's findings, Silicon.com interviewed 12 UK-based CIOs, two-thirds of which confirmed that IT departments will be shells there former selves in five years time.  In January 2003 (well ahead of Gartner's prognostications), I wrote Long live the CIO, but kiss the IT department goodbye.  And I didn't even mention ASP outfits like Salesforce.com, Rightnow, and Authoria that are making it fashionable to have one-person (the CIO) IT departments.  You (ZDNet's readers) took issue with the headline (see: Why IT departments won't disappear). But in light of the new findings, do you still?

Topic: Outsourcing

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  • First lets clarify....

    "Outsourcing", its true is growing. As someone that has worked in IT Services, we have seen all kinds of technology services being "outsourced" to us here in the US sice the 90's. We also have seen some companies bringing back some IT into their companies, yet still need assistance or services related to its support, or new services that are needed. This back-and-forth has been going on since the early 90's....its nothing new in business or IT, or any, for that matter.

    If outsourcing is expected to grow to some radical level than it has, to the point where all or most of IT will move outside the company, I find that ridiculous! And, I still have questions about that data.....because thats still relative to what? The US's total IT GDP? A generic companies ROI with current IT/cost savings involved? Quality of service issues? Expertise issues? New technology they do not know or have? Each of those demands returns a completely different result as far as outsourcing goes, and letting IT people go, as well. To say ALL It will go doesnt make since. And its all relative. Its relative to the definition of the type IT being outsourced....company A may hire IBM to handle "offshoring" supplychain or business processes thus removing a huge part of that business elsewhere and laying off thousands....another may keep those services in-house but request a web site and web apps from a vendor and fire their 3 web designers. Both may have increased outsourcing the same relative to those IT departments in-house, but they are two completely different returns and two different needs and levels of dollars involved. The latter companies expertise and competitiveness may weigh on senstive supplychain processes so it makes since to keep that in-house as IT goes, but the former does not, so its outsourced.

    As for quality, just because I hire some highschool kid to mow my yard because he's cheap and I dont have the time or care to do it myself, doesnt mean I cant do a much better job. My son is a perfectinist like me so I know when we do it its perfect and quality is important. The difference is that aspect of my life (my yard) is not my top priority in life......ie. most businesses have certain IT components they dont care about or care to do, while others may see IT tied to critical competitive advantage necessary to survival of the business. But to imply ALL IT will move offshore is incorrect because there are huge components and types of IT that depending on the company, may be tied to highly complex or secure to the companies competitiveness. I cannot image a company that builds and sells software based on a single CIO and an army of overseas programmers. Wow....the CEO of that comany must surely go to bed uneasy knowing the code that supports his business anyone can cheaply program. If my company was a competitor against that company, sure would be easy to compete...just hire the same outsourcing outfit in India and have them build the same software. Where does your argument work there?

    Also, I cannot imagine there exists a single company that does not outsource something in IT as well as OTHER non-IT services.....so whats the big deal. We outsource HR services from a company, but we built the web site for that company that delivers that data to clients via the web. So, nothing new here...companies exchange services, fire and rehire IT and outsource new IT and non-IT needs constantly. Still, I suspect, the IT departments never leave on some level, as they may be reinvented for a new business model the company needs next year. Its all relative to what you mean by IT. More and more IT needs are created everyday, born and defined by new business processes now, so does that mean when its outsourced, its IT? And does outsource imply "offshoring"? Thats the real question...

    What is critical is defining what types of trained IT people are hired, retained and retrained by these changes. Despite this article saying IT will be a "shell" of its former self, that doesnt mean that same company now moves all its IT toward outsourcing and offshoring vendors. I dare you to show me a CIO or management team that can manage networks, complex web applications, teams of programmers, quality control projects, custom-ralted IT issues, and have another company rewrite their business model and processes and that company exists for long in this highly competitive digital world. Wheres the edge?

    It will take some years but I predict companies will wake up slowly and realize its PEOPLE and talent that ultimately differentiate their company from the competition....and that costs money. And thats includes IT folk.....
    wildranger