Does IT matter?

It has been more than five years since Nick Carr made his prediction about IT becoming inconsequential. His argument was that IT will become so standardized that it would cease to have competitive advantage. IT would roughly follow a utility provider type of evolutionary path. Since then we have had great strides made in Cloud/Grid computing and it appears IT infrastructure is on its way to become standardised. Though I have made points about capacity issues here and here, except for one major incidence there is no other slip up yet. Many of components (the Intellectual Property of IT), sitting on top of IT infrastructure such as ERP, CRM, BPM too, are standardised to great degree. So are we really going to have a standardized IT environment and hence IT would not matter strategically?

IT was necessary and sufficient for competitive advantage till some time back. But with the standardisation and proliferation of IT, it has become necessary but no longer sufficient for competitive advantage. What that means is just investing in IT will not give companies the strategic advantages. It however does not mean that IT investments can be simply cut back. So enterprises are going for the more bang for the buck thru outsourcing of infrastructure and business as usual activities, and the utilising the savings for transformational initiatives.

The next focus area for competitive advantage will be driving out risk in implementing these standardised capabilities. The enterprise who could implement these capabilities faster and reliably, will get the advantage. In my opinion we are in middle of this phase. This is when enterprise architecture and project management practices are being defined and utilised to its fullest. Over a period, these implementation practices too will be common place.

Then there still may be opportunities to gain competitive advantages thru IT. Unless you believe there are limits to human mind and how much it can innovate - this is a distinct possibility. But the investments needed for such endeavours will be so high that, only outsourcers will invest in innovation and then charge enterprises differently thru differentiated offerings. Once that happens, the utility model will break down and enterprises will start moving to a non-utility model. It does not happen to utilities, because what utility companies distribute is indeed a commodity (well you cannot give more pure water to some of your consumers and charge more, can you?).

We are back to square one, aren't we?

That to me appears to be future of enterprise IT. So IT would continue to be of importance to enterprises, but enterprise would squeeze more value out of IT by using IT as shared utility rather than a captive resource. And this in the end it may result in IT becoming a captive resource again. Well this has happened in past. I wasn't born then, but I have heard stories about IBM Service Bureau and their shared services model.

SOA Fable: Can you handle the pressure???

One of my friends had this experience in recent past, which relates to SOA.
He had his storage boiler system replaced with a combination boiler. A storage boiler system, heats the water and stores in a container to be distributed on demand. Whereas the combi boiler does not need a storage tank for hot water. It directly connects mains to all taps, heating the water while its flowing thru the boiler. So it supplies hot water at mains pressure. The combi boiler is very energy efficient because it heats water only when needed and does not waste heat while hot water is stored. There was an unintended consequence of this introduction of efficiency. Till now all showers were shielded from mains pressure by a storage tank, but now all they were exposed to mains pressure. Within short span of time, all his showers broke down because they were not rated to work with mains pressure. He had to replace all his showers to work on mains pressure.

What is the relevance of this tory to SOA? In SOA, services are introduced in an evolutionary manner. We cannot design the entire enterprise in one go for services usage. We keep on introducing the services as and when we can. Service consumers too come on board, as and when they can. It means that overall configuration of system in terms of service suppliers and consumers is very dynamic. So you are not sure what non-functional change you will be exposed to, as a service consumer. If a upstream service were to become more efficient it might mean additional workload for downstream services. How do you handle such an upserge in demand?
The key is to be prepare to accept unprecedented demand. SOA is desirable but not EASY....

EA Governance

It has been a while since I posted on this blog. This discussion initiated by Todd is of some interest to me and got me motivated to post this entry.

I had spoken at Open Group Conference, about the same. My presentation can be seen here (subscription required).

My concise picture of EA governance is as below.


The governance function of EA can roughly be divided into three broad categories, viz. legislating, ensuring compliance to legislation during execution and adjudicating the non-compliance.

When people talk about governance they mainly talk about compliance and adjudication, as pointed out by Todd. But for me the most important piece of governance is legislation . That is - when principles, policies, standards and references, which defines the compliance framework, are set. A broader community participation at this stage and a feeling of belonging, improves the compliance and lessens need for adjudication. Otherwise it appears that EA group is pushing its own agenda on practitioner community and practitioners actively resist such a push. Which leads to a lot of adjudication, requiring lot of management attention.

I am not saying EA legislation needs to be a totally democratic process and must follow democratic norms. But at the same time, it should not appear to be totally autocratic top-down process, thrusting legislations down practitioner's throat. In large IT organisation critical projects get caught in adjudication cycle and EA gets bad press precisely because legislation has not taken on board various points of views.

That reminds me of the role of free press. If we compare EA governance to civic governance, the piece that is missing is 'Free Press' or a communications function. It is a bi-directional communication channel which informs practioners of strategist's intent and allows practitioner's to report back their experiences from trenches to strategists, so that strategies can be suitably altered.

The social media is a good candidate for fulfilling all these functions. It can be utilised to empower the practitioner community to participate in legislation process and can also function as 'Free Press' so that bi-diretional communicaiton can take place between strategists and practitioners.