Reports from Forrester and The Leading Edge Forum serve as bookends portending either to a bubble bursting, or the next golden era. Who's right? We will find out, but technology will have little to do with deciding the winner.
Two reports have been released by major big business think tanks in the last two weeks which serve as bookends to a growing debate over the future of enterprise IT and, by implication, Web 2.0. On one side is Forrester Research and their contention that CIOs will spurn Web 2.0 startups and let the likes of Microsoft, Oracle and Google provide their 'best of breed' solutions. On the other side is The Leading Edge Forum and their multi-year study advising the enterprise to abandon intranets, live on the web and let IT and users cooperate in generating 'best of breed' solutions. It's hard to imagine both sides can be right. Like most indicators of the future, personal philosophy and position play a large part in interpreting the data. If you are a CIO, which do you find more appealing? Conversely, if you are a user, is your answer the same?
performed an intriguing experiment (free registration required) on just this question. What happens when you take one of the world's greatest classical violinists and have him play in the subway? If he opens his violin case for donations, much like Web 2.0 companies putting a shingle on the Internet, how much can he expect to bring in from the busy populace based purely on his brilliance? Read the article for the answer, but let's just say it's the difference between a world renowned virtuoso and a local artist; a Windows PC and a MacIntosh; an Intel and an AMD; a RIM and a Palm; a Lion and a Cheetah.How important is corporate adoption of technology in selecting the rewards and spoils for the technology winners? It provides the framing and context for the mass-market to evaluate technology. How important is framing and context? Everything. The Washington Post recently
The IT Factor
What is the current role of IT? A quick Google search gives us a few options:
- Includes all matters concerned with the furtherance of computer science and technology and with the design, development, installation, and implementation of information systems and applications;
- a term that encompasses all forms of technology used to create, store, exchange and utilize information in its various forms including business data, conversations, still images, motion pictures and multimedia presentations;
- Information technology provides the "engine" used to drive useful information systems. This includes computers, software, Internet/Intranet and telecommunications technology.
The list goes on of course. Picking out recurring themes, we see IT defined as the 'engine' driving a corporations technological advantage, the means to automate repetitive functions and even the key to an organization's profitability and productivity.
I think everyone would agree with these definitions as the genesis of IT, but what we see today reminds me a lot of Cheetahs. Yes, the fastest mammals on earth. If a corporation needs to attack millions of database records and view the results in a nice report, they can often do so in record time - certainly compared to their corporate forefathers. Most corporate IT departments today are well suited to catching and devouring modern information problems. So much so that among all Fortune 500 IT departments, it may be difficult to tell if anyone enjoys an advantage or not. Uniformity has brought the great ability to move in a single direction at high speed.
But what if the game changes? Not just a permutation of current problems, but an evolutionary lurch of every business problem. How strong is a corporate IT group when today's viable solution providers have been whittled to a mere handful of well-known names. It's a situation not unlike the Cheetah's genetic stock: its very survival is threatened by the lack of variability. For instance, what if the next generation of business winners are selected by their ability to enhance communication - not just within the confines of business firewalls among colleagues, but outside the firewall with anybody that can provide an advantage? Furthermore, such choices in communication are highly individual. How will this square with IT departments that are trying to centralize every and all technology.
IT's Self Interest
Every generation there's a company that CIOs can purchase from which is considered 'safe' - perhaps because it's the best solution; certainly because everybody else is doing it. However, this is, in the long run, a self-defeating strategy. If there is no variation, then there is no advantage. If there is no advantage, then there is no superior profit margin. And if there is no superior profit margin, then there is no way to treat IT other than as a cost center. Suddenly the IT Cheetah is suffering from too little genetic variation and a decidedly herd mentality. If a social, more collaborative gene is suddenly needed, how much effort will be required to grow and nurture it - or is it even possible?
I re-read Nicholas Carr's well-written, compelling article The End of Corporate Computing. He proposes an excellent argument that business IT today is much like business power generation of yesterday - needed at the time, but better performed as a specialized entity that can properly scale. As businesses realized the superiority of commoditized and standard power distribution, they dismantled their water wheels and plugged into the grid. As a result, even though we take it for granted, anyone can go to any lighting store, purchase a lamp, plug it in and work well into the night. 'The End of Corporate Computing' makes a lot of sense when IT is compared to a utility.
In this scenario, is it any wonder why CIOs want to buy, as Forrester asserts, only from the large providers? If indeed IT is undergoing a transformation similar to a power grid, then it follows that the focus of IT is how to do more with less. This in turn means less resources for implementing anything requiring more pieces, hence the desire to purchase broader solutions from fewer and larger vendors. Taking things to their logical conclusion, it's not a stretch, and even quite probable, that in the end IT will be a department of one - choosing, among the commoditized solutions, the best fit for the company. However, while information can travel in bits and bytes at the speed of light, it is not electricity. And a person is most definitely not a lamp.
The Spark of an Idea
If lightening strikes and no one is there to see it, did it really happen? A forest fire might be an indication. If an original manuscript is dropped in a forest and no one is there to read it, does it really exist? There might be physical indicators like sheets of paper blowing in the wind, but even the combined works of William Shakespeare would be indistinguishable from a ream of paper - if no one was there to read it. Unlike electricity, information has no inherent, physical properties. Information requires both interpretation and communication to give it value. As of today, that frames information technology as a wholly human endeavor. Furthermore, institutions such as working groups, professional guilds and even universities demonstrate that the best way to exchange ideas and knowledge is still person-to-person.
What is the value of IT to corporations if the only option is to select from an increasingly homogenous pool of options? If at the end of the day two corporations have indistinct technology, they will be forced to compete by other means: marketing, sales, partnerships, COST, etc... Indeed, what is the value of a corporation itself? What it produces, the sum of its parts, or the knowledge of its employees?
Enter the study and report from the major think tanks. Obviously, as a software vendor, I would like IT to be as open and welcoming as possible. Unfortunately the implication of the Forrester report is rather chilling. Much like Joshua Bell playing violin during rush hour, you may have one of the great technical solutions in the world, but - as of today - the audience will be meager. And things will only get worse as CIO budgets constrict, solution providers winnow and IT slowly disappears.
But what if IT let technology be commoditized and instead focused on information? Could there be an 'educational' model whereby corporations may be able to compete less on technology and more on information - specifically interpreting, analyzing and communicating information; much like a university? We all recognize the value of a Harvard or MIT, for example. So could IT departments eventually hold similar prestige and value?
Doug Neal and The Leading Edge Forum presents this more compelling alternative. The LEF recognizes enterprise IT as a social contract among individuals and outlines a maturation step for everyone - IT, employees and management - in order to achieve the next generation of technology and business requirements. What the LEF describes to me is IT developing into more of an interactive, bi-directional department that concentrates less on policing and more on supporting its employees. In return, employees will have the responsibility to educate themselves on best practices and even bear the consequences of their decisions. As a result, employees will be able to choose the appropriate tools for their needs, information technology will again provide corporations with advantages over competitors. Accordingly, Web 2.0, and the entire software industry, should explode as the next generation arrives and is adopted.
Are corporate users ready for such power? Henry Ford began mass producing automobiles in 1908. However many states waited twenty years or more before developing guidelines for proper usage, establishing testing and culpability rules and requiring licenses for operation. If the PC revolution truly began with the IBM PC in August of 1981, then - like the automobile - the workplace is ready for more autonomy. By relaxing its vise-like grip on the technological wheel, IT can actually save itself from the bend in the road. By adopting a different social contract, IT may thrive again as differentiator in business - not by its ability to babysit the workforce, but by its ability to educate.