IT outsourcing has gone through several generations but each tended to increase centralisation and reliance on a single ‘prime supplier’ as economies of scale increased. However, the scale is now larger than an organisation and outsourcing to a single contractor is increasingly not cost effective or agile enough and the market incentives are now for SaaS and disaggregated contracts with multiple suppliers. Though, SaaS solutions aren’t normally tuned to your environment and so integration of each component into a service for your business becomes a much bigger challenge.
Most large organisations haven’t had to actually run their IT for many years – they have relied on the prime contractor and having ‘one throat to choke’. So how do you move from reliance on a single supplier to creating a working IT environment from multiple suppliers providing multiple services?
In my experience, the following needs to be in place to provide services successfully in a disaggregated world and stop the throat being choked yours:
Enterprise Architecture
If you don’t know what your business needs, where it wants to go and what’s already in place how can you have a coherent plan? Enterprise architecture needs to be a real function within the business. IT should be involved in understanding and shaping business plans to ensure that IT is capable of providing the systems and service needed. Information management and governance, helps you understand where the data is and how to access and will help stop disaggregation meaning further data duplication and rework. Having a clear enterprise architecture will also help you understand what you need from the services to be able to talk to your suppliers. This will help you understand when your needs can no longer be supported by them and you can plan to change accordingly so you don’t get stuck on a platform that just isn’t fit for your business’s needs.
Service Management processes
The best example of why service disaggregation is scary is when we think about several suppliers who each provide a component pointing fingers at each other when things go wrong. Service Management processes need to be clear and the accountabilities in the process defined to ensure that you’re not sitting on a Sev 1 major incident with no suppliers there to help. You need these processes documented and in place before you talk to the supplier so you can understand whether the supplier can fit – not only that they will ‘exchange tickets’ but how and when. You can then identify what changes are required if you are to integrate them.
Supplier Management
In the past, a contract was something that was written with expensive pens by lawyers and once signed put in a draw only to be brought out when things went seriously wrong or it needed renewing. Now a contract needs to be a living document, covering all aspects of the services being bought and the integration of that supplier into your operation. Once signed, the contract needs are actively managed as the environment changes and not just by procurement or commercial but by the managers who interact with the supplier. You need to share plans with the suppliers and treat them fairly, whilst expecting the same in return and exit suppliers who don’t.
Culture
The world moves and so do we unless we want to fall off. There is no perfect solution there is a solution which works well/best at the moment but tomorrow that will change. You need agility through the organisation, underpinned by Risk management processes to ensure that you’re maintaining a dynamic culture which can respond to change.
The true scaling and commoditisation of IT is still just beginning and the pressures on the enterprise to cut costs, improve service and respond to change will increase. If you aren’t ready it’s going to be scary but if you are it’s going to be fun, challenging and bring a whole world of new opportunities which, to quote Douglas Adams, “you can probably make a career out of”.
