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Will IT Become More Strategic Through Cloud Computing?

by Bill Ives

Here is an interesting study by IDG that found that cloud computing is enabling a more central role for IT in shaping business strategy and driving innovation. The research polled 200 IT managers in the U.S. and Europe. The vast majority (96 percent) believes that the primary role of IT has changed over the past five years, and 71 percent feel the trend to continue over the next two years.  While 54 percent of the survey participants acknowledge the current value of IT is largely defined by its role as owner and operator of IT infrastructure, they believe within two years, the primary value of IT will become managing the IT supply chain. Half feel that the cloud is contributing to this change.

Looking further into the results, IT professionals believe cloud computing can accelerate agility (63 percent), innovation (58 percent) and collaboration with the enterprise (57 percent). Respondents also anticipate cloud computing will boost IT productivity (55 percent) and decrease the resources dedicated to IT support (40 percent). These changes will likely trigger a demand for more business and management experience in senior IT professionals. Nearly 70 percent of respondents feel an increasing number of CIOs and senior IT staff will have a business (as opposed to a technology) background in the future.

The nimble nature of cloud based IT coupled with the reduction in maintenance needs, should allow CIOs to focus more on business issues. However this transition will set up challenges. At last years, MIT CIO Symposium, panelists talked about the CIO Paradox. They have to drive innovation, manage risk, and control costs and these goals can be at cross purposes.  They often inherit costly legacy systems and then are told to go forth and innovate.  I wonder what the talk will be at the 2011 session. I am planning to attend and will be reporting on it here.

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Forbes Study Says Business and IT Leaders Need to Better Align Their Thinking

by Bill Ives

According to a new study about information management (IM) released by Forbes Insights, data-related problems may be costing large enterprise companies over $5 million annually. Data-related problems cost the majority of companies more than $5 million annually. One-fifth of the respondents estimated losses in excess of $20 million per year.

The report, “Managing Information in the Enterprise: Perspectives for Business Leaders,” looks at the challenges faced by both IT and line-of-business executives as they look for better data management. The study asked more than 200 high-level executives on a global basis.

It found a divergence between business and IT leaders on how to best manage information, including a lack of agreement over who within the enterprise actually “owns” the data—users or IT. I would have to side on the business leaders here for most situations. It is this type of thinking about ownership that can get IT in trouble. It is like librarians thinking they own the books.

Looking into the divergence in more detail, the study found that business executives and IT frequently disagree about where data quality issues exist. The biggest quality issue identified by business executives was inconsistent data (40%), while IT named the gathering of duplicate data (38%) and data migration (38%) as the major problems.

This divergence is not because business leaders do not see the importance of managing information. Nearly all (95%) agreed that strong information management is critical to business success, and 85% agreed that their organizations treat information as a strategic asset.

This divergence is costly. Fragmented data ownership (41%) was the leading business roadblock organizations face in establishing an enterprise information management program, ahead of not understanding the cost of poor data quality (23%) and lack of leadership (22%).

A clear strategy is needed with well defined governance. The study found that 45% of organizations said they have some type of enterprise information management program in place, and 31% said they are currently developing one.  This is not enough.

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Working around the IT Guys

by Rob Paterson

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One of the barriers for a 2.0 world in any established organization is the IT department. With some justification, they feel that they cannot allow any risk to core systems such as payroll, CRM etc. So they keep the 2.0 world out of the organization.

Chris Anderson Editor of Wired magazine has found an elegant solution. He has set up two Lans at Wired. The Tight Corporate one and the open 2.0 one. Feels like a good work around.  Here is his excellent short post on the topic

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