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IT services spending power shifts away from IT leaders

Stephanie Overby | March 4, 2013
More than 40 percent of companies expect that their CFOs will have more influence over IT services spending over the next 12 months--a five percent increase over the previous year's data, according to new survey results from Forrester Research.

The situation isn't news to CIOs or their IT organizations. "Quite a few senior IT professionals understand it," says Bendor-Samuels. "It's very hard for them to get out in front of it. The cloud tells the business they can have production-ready tech at their fingertips without having to go through the CIO."

Bendor-Sameuls predicts problems ahead. During the distributed computing revolution, business stakeholders making IT services decisions "created a huge mess over time," he says. "And this is going to hurt over time. But not now. And by making a big fuss now, IT runs the risk of crying wolf." It's like an iceberg, he says. "These forays by the business community appear to be cheap and quick, but heir spending is just the 5 percent that is visible. But 95 percent of the cost is reworking the enterprise systems to drive these new efforts. That's below the water line, but that's what sinks the boat."

But enterprise IT itself may be the problem, says McCarthy. "IT has become very conservative," he says. "They were lulled into complacency during the period in which the rate of technology change was low and the degree of IT control was high.

Both agree that enterprise IT needs to address the shift in IT services influence. "[IT] needs to get in lockstep with these guys [in the business]," says Bendor-Samuel. While IT may not drive IT services spending, they need to remain involved. "They're going to do this whether you're with them or not," he says. "And if you take a week to get to them, the deal is probably already done."

The combination of business-led innovation, new vendors and delivery models will require IT management to rethink supplier governance in order to help the business take responsibility for its growing universe of suppliers and fuel innovation, says McCarthy.

 

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