Tech Boards: A New Secret for Bridging Business, IT
Aug 17, 2005 5:00 AM PT
The once thick walls that have traditionally been separating IT departments from its business leaders at companies both large and small are beginning to thin and crack. In fact, all signs indicate that these walls will soon crumble completely to create a new environment in which business leaders and technology leaders interact and work toward common goals, with end results likely to have significant impact on the bottom line.
Enterprises can no longer afford to view technology as bits and bytes, installing a new server or database. Technology is the lynchpin in transforming enterprises to on demand businesses that can quickly respond to ever changing market conditions.
Bridging the Gap
Several top companies such as Federal Express, Mellon Financial Corp., PNC Financial Services Group and Pfizer have created board-level panels with tech-savvy directors to oversee new technology projects as well as ease compliance and governance issues surrounding new technology.
The new and emerging tech boards are bridging the gap at these innovative companies by helping to ease complex technical issues now facing many boards. A response to the free spending ways of the dot com era, increasing complexity of technology issues and the need to bridge the gap between IT issues and business issues were several reasons the story cited for creating these new tech boards.
The emergence of these new tech boards is long overdue. For years IT departments have gone down a path of implementing technology that now consumes 80 to 90 percent of IT budgets simply to maintain, leaving a miniscule amount of budget to implement new projects that can actually generate revenue.
At the same time business leaders have handed down marching orders to execute new programs without concern for limits of IT systems or resources needed to build, deploy and manage these systems.
Other industries have resolved similar issues on their own over time through standardized processes and layers of governance. Imagine if construction firms could simply erect a building without developing, presenting and getting approval on constructions plans, or even have developed a blue print at all.
Construction industry "board of directors," the architects, developers, government agencies and other concerns with oversight of the blueprints, help to assure construction goes smoothly and units are constructed to meet their intended purpose. Often approval of construction plans is extended to community residents through our democratic voting process.
In no other area of emerging technology is it more important to get board approval on new projects than with service-oriented architectures, a standards-based framework that enables enterprises to evolve to on demand businesses that integrate business data and applications with customers, partners and suppliers. An SOA is equal part technology planning and equal part transforming business processes. To make improvements and grow, businesses need better visibility into their business processes.
Breaking the business down into a component view -- from a discrete process or the business processes supporting the entire enterprise -- is critical to achieving business improvement and growth. These business components form the blueprints of any successful SOA implementation.
Mending the Flaws
Starting to deploy an SOA without this blueprint is equivalent to a building a house room by room with no blueprints or plans in advance for how elements including electricity, plumbing, heating and cooling, and even how the foundation needs to be constructed. Imagine. The resulting house would have uneven floors, mismatched halls, non-standard electrical outlets, and may even lack fundamental elements like a bathroom or kitchen.
Companies like FedEx, Mellon, PNC and Pfizer with board oversight of technology are at the forefront of this trend. This oversight will speed deployments of new technology by assuring that business goals and technology goals are linked. In just a few years what now seems like a new and different world will be commonplace throughout the industry. It has to be.
The business benefits derived by implementing new technology -- such as SOAs -- can significantly impact the bottom line. IT leaders and business leaders must work together, share plans and have common goals. Cracks in the walls need to burst into holes and eventually the walls must crumble completely. Company boards of directors will help to lead the fix.
Michael Liebow is Vice President, Web Services and SOA, IBM Global Services.