The Evolution of the IT Department

From basement to boardroom

“Perceptions of the IT department have certainly changed. When IT started it was largely about automating finance processes. It was very much something that no one else understood. I’ve witnessed myself that in some of my roles the department was still in the basement. I also used to get comments like, ‘You don’t look like you work in IT!’”

“I first began to see the transition somewhere in the 2000s, when I started to clearly see conversations about partnership and how important it was to be joined up. IT is not just a back-office function anymore. The whole world is digital, so it is much more forefront.”

Despite predictions^[2] that 2020 would see the end of the IT department, today the function is still strong. Perhaps the most significant reason for this is digital transformation. The last 20 years have seen organisations all over the world, totally overhaul their business from back end to front end. This process has propelled IT into a fundamental part of a modern business. It has also changed how organisations view the function, with a greater understanding that IT leaders need to be involved in planning. The evidence of this is in the figures. According to research^[3], more than half of IT leaders report every year that the role of the CIO in their organisation has become more strategic.

A digital transformation partner

However, according to 2019 figures, the number of CIOs at boardroom level has suddenly dropped by 13% from 2017^[4]. Why? One suggestion is that businesses see the role of the CIO as leading digital transformation projects and now many organisations see their transformations as ‘complete.’ This attitude is a major concern for IT workers and also a common misconception for businesses.

“If we remove the word digital, we are left with transformation and transformation is never complete because the world is changing all the time. Of course there was an initial big boom of digital transformation 20 years ago when IT departments were focusing on digitising the back office. But depending on the company, sometimes even this stage is not yet complete.

As time goes on, digitisation is simply moving more to the front office and the customer-facing processes. Digitising how we communicate with customers tends to be faster-paced, as customer needs change so much more often than our finance regulations and processes, for example.”

With customer demands changing so regularly, transformation cannot be viewed as a box which can be ticked. Even if major back-end digitisation has already taken place, front end optimisation and evolution is an ongoing process.

How can IT overcome misconceptions?

For the function to retain its influence and reputation as a strategic partner, it’s crucial that it tackles misconceptions about digital transformation and the role of the IT function. What are the best strategies for IT leaders to make this happen?

• Put formal processes in place – “The way we have approached it at Canon is that we’ve put in place some processes, driven by the CEO, to make sure that IT is involved as early as possible – for example, putting checks in place, particularly in terms of financial approval. We’re also making sure that once projects are completed, that we have a formal review – have we achieved the business case, are the systems actually being used, what can we learn from how we have worked together?”
• Take joint responsibility for projects – “Our job is not finished when we have delivered the IT, that’s the easy part. It’s more difficult to ask questions - why do you want to do this? What’s the business case? I ask my team not to be afraid to step into conversations which are not just about IT but about achieving business goals. I say to people, don’t ask for permission, you are as important as anyone else.”
• Increase visibility – “Make sure that the costs of IT are more transparent so that they are better understood. This is helpful, because it’s more likely to make them think about what is valuable. When people don’t know what it costs, there is less responsibility.”

The future of IT

We are in the midst of global transformation and this has defined the role of the IT department in recent years. But in 10 years’ time what will it mean to be working in IT?

“Technologies have evolved a considerable amount. Now a lot of processes can be automated, and the world is moving towards the cloud. As a result I think the role of the IT department will become smaller, less technical and more focused on architecting information, business processes and applications for the enterprise.

IT departments will need to make sure that information flows through a business and that data links together. This is where you can’t do without IT. Their role will be defining data, defining business processes and ensuring applications are used for what they are meant to do and not customised. They will then need to make sure that all of this works, supported by technology and a performing network. They will also play a key role in optimising IT costs, ensuring there is return on investment, driving IT compliance (SoX and GDPR) and enforcing information security.”