From basement to boardroom: the evolution of the IT department

You’ve got to feel for the IT Department. Painted as the rarely seen, basement-dwelling tech geeks, they spent the longest time as the most misunderstood team in a business. Thank goodness for the consumerisation of technology. Now everyone is a smartphone user and children learn to code at school, it’s created a new understanding of what IT teams do and their value as an integral part of any business.

Caroline Serfass, CIO of Canon Europe, is used to the stereotypes. In her career, she has witnessed a notable shift in attitudes towards IT and even her role within it (“I used to get comments like ‘you don’t look like you work in IT!’”). Early on, IT was largely about automating finance processes, which held no thrall for the wider business, but today it’s no longer a back-office function. “I first began to see the transition sometime in the 2000s,” she recalls. “Conversations began about ‘partnership’ and how important it was to be joined up.” This shift was a necessary precursor to the era of digital transformation, to which IT departments are absolutely essential. IT leaders now play a fundamental part in business planning, as organisations continue to entirely overhaul their businesses to meet the future. As a result, and in a radical perception shift, the CIO is now a more strategic role than ever.

A misconception ends, but others begin

However, there’s a concerning trend afoot: as the IT Department profile rises, a KPMG survey has found that the number of CIOs on boards is decreasing. In light of their new strategic position, why the sudden drop? Some suggest that this is because many businesses view their digital transformations as ‘complete’ and in this respect, CIOs are no longer required to lead them. Caroline disagrees with this attitude entirely. “If we remove the word digital, we are left with transformation and transformation is never complete because the world is changing all the time,” she says. “There was an initial boom of digital transformation 20 years ago when IT departments were focusing on digitising the back office. But as time goes on, digitisation is simply moving more to the front office and the customer-facing processes.” To ignore the speed at which customer expectations change and evolve is a dangerous move. The successful organisation will not simply shut the door on transformation after back-end digitisation is complete, but rather look to a continuing process of front-end optimisation and, as Caroline rightly says, this is never complete.

The optional IT department?

Transformation is essential, there’s no doubt about that, but the arrival of software as a service (SaaS) in the early 2010s has brought into question the necessity of an in-house IT function. A SaaS solution that can take over hardware maintenance and support certainly sounds appealing, but realistically it’s an approach that is more suited to smaller businesses. Having no central function is simply not appropriate at enterprise-level. “Many of these products overlap in functionality,” explains Caroline. “What’s most important is that information can flow and when applications have not been architected or orchestrated, then this just doesn’t work. If you work in a fragmented way, it will end up being more expensive than if you worked together.”

Transformation aside, there is certainly a business culture issue to address here. On a day-to-day basis, much of what IT does is largely invisible, and employees only see the team looking after laptops or smartphones. But Caroline likens the function to an iceberg, “you might see those elements, but underneath there are a whole set of things which require planning and strategy.”

Underscoring value, influence and reputation

The challenges are clear, but what needs to be done to address them? Caroline has three key actions which IT leaders can implement to tackle the misinterpretation of their function:

• Put formal processes in place: “At Canon we’ve put in place some processes, driven by our 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 to not be afraid to step into conversations which are about achieving business goals. I say, ‘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.”

And in ten years…

Looking to the future, the shift to automation and cloud will change the way IT departments operate, and Caroline is keen to stress that they need to stay focused and have a keen sense of clarity in their planning. “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.” She believes that information flow is key, and this is where IT plays an essential part in every organisation. “Their role will be defining data, defining business processes and ensuring applications are used for what they are meant to do and not customised,” she says. “They will then need to make sure that all of this works, supported by technology and a performing network.”

If you think this sounds business critical, then you’d be right. Over the next decade, as Caroline predicts, we will see IT playing a key role in “optimising costs, ensuring ROI, driving compliance and enforcing information security.” With a place firmly in the boardroom and a significant strategic role in driving business success, it’s about as far from ‘the basement’ as a function can possibly be.