And so farewell to IT?

There aren’t many organisations that are truly happy with the structure and performance of their information technology department. But new research indicates that major changes are on the way, writes Guy Dresser.

The debate over the future of the IT function within business organisations has polarised into two distinct camps. While most informed observers seem to agree that IT will be organised into a more sensible business-facing model in future, there is marked disagreement over its relationship to the finance function. Some have claimed that finance directors will have to become ‘hybrids’, offering both technical and financial skills to the business. Others argue that IT will fade into an outsourced commodity provided by some third-party.

Independent research sponsored by accounting software suppliers Walker International found 31% of finance directors surveyed believed IT would be more integrated within the organisation. But just 7% believed it would be more closely integrated with the finance department. Separate research, just published in a major new report by Ovum* indicates that many IT directors can already see the writing on the wall for their long-term career survival, because the mystique of IT – necessary for its cultural survival as a professional pursuit – is already being eroded. Ovum conducted research at the IT Directors’ Forum, earlier this year. The survey’s findings are of key concern to the finance director.

Not only will ‘IT’ disappear as a title itself, but IT specialists will have to become more business focused and take on more managerial roles within the organisation. This will mean extending their skillsbase to take on responsibilities in marketing, human resources and, obviously, technology.

Finance directors will of course be delighted. Most surveys have uncovered suspicion and distrust of IT in the past. If IT directors really get to grips with the financial and other constraints that affect the rest of the organisation, they could well find themselves delivering a more focused service to the rest of the business.

One IT director involved in Ovum’s research commented: ‘I have to wonder how long the IT specialist is actually going to survive. Because I think the way I feel about it right now is that I exist by virtue of the fact that most of my peers have no education in IT.’

Walker International’s research echoed a few of these findings. Marketing director Garrey Melville commented: ‘The downfall of many IT departments has been due to poor internal relationships; failure to form true business partnerships; inability to add value or articulate the value added to the organisation. Much of this has been underpinned by shortfalls in planning together with weak project and risk management skills.’

But Walker’s survey contradicted Ovum in its predictions of the future relationship between finance and IT. It found that while the finance department will rely very heavily on IT for its future performance, 51% of FDs believed the relationship between themselves and IT directors would not change.

In addition, 32% believed they would work more closely and just 2% believed the IT director role would disappear.

There’s no doubt that there will always be a need for integration and implementation of the IT infrastructure in the organisation. No matter how sophisticated end-users become, someone is going to have to put systems in and make them work. No amount of outsourcing is going to eliminate the IT role altogether – someone on the board will have to sign the cheques.

And they’re going to need more than superficial knowledge about IT.

* Details for how to order Ovum’s report The IS Organisation: Forging New Business Relationships are available on: 0171 255 2670.