According to a new report from KPMG, the IT function is caught in the middle of a massive shift, as disruptive technologies jolt organizations into new business models and organizational structures. The paper, The Flexible IT Workforce; the nexus of talent, skills, and leadership for the future of IT, considers this to be a tremendous opportunity for IT to “rebrand” its role. IT must move, it explains, from being the sole proprietor of how organizations develop and use technology to serving as a flexible partner that helps facilitate a technology-led innovation culture; creates an ecosystem of skills across the enterprise; and expands the technology leadership structure.
This reshaping of the traditional IT department is the necessary result of dramatic and lasting changes in how technology is used in the business. “It’s basically a foregone conclusion for most organizations that the cloud is going to be the platform of choice,” says Jeoung Oh, principal at KPMG. “IT organizations need to accept that the vast majority of application maintenance and support, the vast majority of the infrastructure, the maintenance of their data centers, all of that work is now residing in a third-party organization.” As a result, he explains, they need to review what remains in the centralized IT function going forward and how IT will bring value.
A More Flexible IT Function With Core Centralized Capabilities
For the most part, the answer is that most of the centralized IT function will need to be replaced by a more flexible, decentralized version. After all, the business, across most of its functions, will look for the quickest way to innovate and leverage technology, which may often exclude IT. Marketing and finance, for example, may build their own development teams.
“These activities and capabilities are going to be decentralized and as they spread out into the organization, the remaining centralized IT function has to understand how to work within that,” says Oh. Some core aspects, such as security and a common architecture function, will remain centralized, he says, but the rest will fan out to other areas of the enterprise.
However, IT will be far from off the hook. The organization will still need to focus on helping facilitate those departmental teams through flexible service offerings. Ultimately, they will need to serve as “conductors” or “master facilitators” of innovation across all functions. They will be called upon to help enable solution development across the enterprise, rather than just within the four walls of the IT shop.
The Evolving IT Workforce And Changing Skill Set
The goals of moving toward a flexible, rebranded IT function, according to the report, align with the results of the recent 20th annual Harvey Nash/KPMG CIO Survey — which found that four in ten of CIOs surveyed believe their digital strategy would fail without an innovative and experimental culture. And technology and strategy alone are not enough: IT leaders need to pay just as much attention to having the right people and culture to drive through necessary innovation.
That means big changes are coming when it comes to IT talent and the necessary skill set to succeed in rebranding IT. For one thing, the headcount and staff mix may drastically change. “The skills and the makeup of talent resources will become very different in the future,” says Oh. “If you’re no longer maintaining all of the data centers and the applications, that may apply to more than 50% of the current headcount.”
Instead, in the coming years, automation, cloud, and advanced operational tools will reduce IT operations to less than 20% of the function’s time, according to The Flexible IT Workforce. But the focus on application development means this kind of work will double by 50%, and will be made up of resources and skills embedded within business functions and talent that helps drive and enable these teams. “Understanding the availability of these skills and resources will be a critical role the CIO will play in addition to helping other leaders train their people on relevant technology skills for their area,” the report says, adding that throughout this shift, “IT leaders will need to maintain transparency and stay open to new ideas, demonstrating trustworthiness to employees.”
Oh points out that even job classifications will dramatically change during the IT rebranding process. “If you look at job family classifications today, there are not many companies with data and analytics, AI or automation,” he says. “I think the challenge and opportunity for companies is, how do we define those new classifications? What are those right skills that we need to have?”
According to The Flexible IT Workforce, there are three key tips IT executives need to keep in mind as they lead the future workforce in a rebranded IT function:
- They should develop and recruit a workforce that is flexible, curious, and innovative.
- They should encourage the IT workforce to experiment with different ways of organizing and delivering.
- They should set up a culture to challenge employees through innovation exercises.
“It’s a different mindset that IT organizations are adopting that says, ‘I don’t have to control everything,’ ” says Oh. The CIO still has a very important role in orchestrating the whole technology landscape for a company, he adds, but now that person must lead by influence rather than by positional power: “That is the new world that they’ll have to work in.”