Recently I’ve been having a very hard time talking to students, executives, and business leaders about information technology.
Even though I’ve spent most of my life in and around technology, thinking about information flows and their implications in a business context, having to use the term “information technology”—even the abbreviation “IT”—fills me with dread, almost a self-loathing, because the term is no longer appropriate in a business context. To borrow a computer-science term, the denotational semantics are all wrong.
The “IT” label is part of the glass ceiling that has limited business technologists for decades. In too many companies, IT leaders, relegated to their cost centers, are subordinate to other C-level executives. “The folks in IT” are seen as providers of services, such as fixing people’s computers.
In other, more forward-looking companies, the situation is radically different. The Great Recession forced these firms’ leaders to recognize technology’s role in driving value. As a consequence, CIOs work on go-to-market strategies as well as on acquiring and retaining new customers.
Just recently, InfoWorld magazine pointed out that CIOs have split into two groups: those who are driving value and those who are still trapped inside the data center. Cloud computing has accelerated this schism, because of its capacity to take the technology group out of the business of servicing other units. With the cloud, business units can take responsibility for their own technology. Using services such as Microsoft’s Azure, they can set up their own servers, establish storage, put applications on virtual machines, configure disaster-recovery systems, and so on. Need more storage? No problem. Experiencing lower demand and want to shrink back? No problem. These services are simple to price and simple to use.
Freed from their service role and increasingly appreciated for their business knowledge, technologist executives are finally breaking down the walls that separated technology from the organization’s other functions. This new freedom will allow them to focus more on their role as enterprise architects, creating alignment between the organization’s technological and business processes in accordance with the company’s business model. They will also be able to focus more on providing governance leadership, ensuring, as Gartner Research defines it, the effective and efficient use of information technology in enabling the organization to reach its goals. They’ll no longer be at the periphery, but will be fully integrated into the core strategic work of the firm, the business itself.
This new leadership role is captured in the emerging title of chief business technology officer. An early mover was Forrester Research, which appointed Steve Peltzman CBTO in 2011. Peltzman told me his job is “helping define and drive our business strategy, as well as being responsible for how we use technology to ‘win, serve, and retain’ customers.”
To those who argue that titles are meaningless, he says: “As soon as I renamed my department BT and my title CBTO, it did a lot of things: It signaled to the company who we were and what we were focused on. It helped us recruit and retain our own staff because they were more interested in it.” He is also critical of technology leaders who still refer to themselves in terms of “working with the business.” “The problem with that is the minute you refer to them as ‘the business,’ you’re basically signaling that you’re not the business,” he says.
While Peltzman acknowledges that technology management still has to focus on classic IT issues, such as determining which systems are critical, managing security, and deploying technology, he does not see these functions constituting his primary role.
Business leaders who question the economics of the cloud are missing the point, Peltzman says: “It’s not about the money. It’s about focus and mental cycles: How much time and energy do you put toward managing in-house technology activities?”
He believes technology leadership is about to undergo a shakeout. “You can tell the ones who will thrive and survive and the ones who won’t,” he says. “It may be a year, it may be four, but many are not going to make it because they are so focused on old-school stuff that their competitors will focus on differentiating them and beat them eventually.”
Another CBTO is Arnoud Klerkx of Sanoma Learning, one of Europe’s largest media and learning companies. He reports directly to the CEO and is a member of the management board. “I’m not responsible for ‘just’ IT,” he says. Instead, he sees his role as moving the company’s products and services into the digital era in a profitable way.
Senior IT executives in other organizations are intrigued by his title and role, he says. “Most of the time, they would love to have the same type of role, but find it difficult to change their old position within their organizations.”
As the digital era advances, it is increasingly clear that we should no longer be talking about “IT” as a corporate entity. We should be talking about BT—business technology. It’s a term that does a better job of capturing the increasingly symbiotic relationship between the firm and its technology and underscores that technology has finally, in many cases, actually become the business.
via IT Has Finally Cracked the C-Suite – Robert Plant – Harvard Business Review.
IT Has Finally Cracked the C-Suite
