Summary of IT Organization Management: Revisiting Centralization

The centralized IT organization is making a comeback.. Why? Because it?s more cost-effective than a distributed environment; it encourages the use of consistent technology standards across the enterprise; and it avoids efforts to reinvent the wheel.

Today?s centralization pulls IT staff out of business units and places them in ?centers of excellence,? based on their business process, speciality or skill set. At the United Space Alliance, the staff is recentralized, but grouped into six process centers, including strategic planning and integration, and user support services. Consolidated Natural Gas Co. moved people into skill groupings such as mainframe, applications development and servers.

Centalization does not come without risks, such as the resentment from the business units that have lost control of their IT component.