appsphere 15 - shining a light on shadow it: a new way of working for "business" and...

Shining a Light on Shadow IT: A New Way of Working for “Business” and “Technology” Teams Brandon Bichler, Partner, Elixirr Partners LLP

Today’s 3 key themes

Copyright © 2015 AppDynamics. All rights reserved. 2

Today, business executives recognise that technology is a core competency, but

there is still a major disconnect between the “business” and “IT”

The way we work must change to address this new reality… IT must focus more on enabling the business to innovate and

deliver a compelling customer experience

For decades, IT teams have been in a vicious loop, keeping up with

business demands for technology while controlling architectural integrity

First of all, what do I mean by “Shadow IT”?


Shadow IT refers to information-technology systems and solutions built and used inside organizations without explicit organizational approval. It is also used to describe solutions specified and deployed by departments other than the IT department.


Poll 1: Shadow IT

1. Do you have a significant amount of “shadow IT”, or technology teams working outside of the CIO’s organisation in your company?

1  Lots 2  A little 3  None 4  Don’t Know

2. What visibility do you have in terms of what these “shadow IT” teams are working on?

1  Good visibility 2  Limited visibility 3  No visibility 4  Don’t Know


Company’s IT spend controlled by CIO Gartner research, 2015

90%

2000

20%

2020

For decades, IT leaders have been caught in a vicious loop of ‘control’

Business taking IT decisions and initiatives into their own hands

The vicious cycle of Control

IT slow to respond to emerging business

needs

IT resources consumed by managing complexity

Changing customer behaviour drives the need

for rapid technological innovation


Poll 2: The Role of the CIO

3. Who does your CIO report in to?

1  CEO 4 CDO (Chief Digital Officer) 2  CFO 5 CTO 3  COO 6 Other / Don’t Know

4. How often does your CIO present to the executive board?

1  Monthly 4 Never 2  Quarterly 5 Don’t Know 3  Annually

In the past, IT has often been viewed as a back office function or something to be outsourced

66%

Only 40% of CIOs present to the Board of Directors more than once a year

MIT, 2014

1% Less than 1% of all US board directors have direct technology experience

PWC, 2015


‘The common [mindset] is that IT spending is a “tax” required to “keep

the lights on”’

McKinsey & Company, 2014

2000-2013, the worldwide IT outsourcing market grew by 66%

Gartner, 2013

40%

More recently, business executives have realized that technology is a core competency for success


“In the future BBVA will be a software company”

Francisco González Chairman and CEO, BBVA

“I originally joined the auto industry because it was the ultimate industrial product… now the car has become the ultimate technology product”

Mark Fields CEO, Ford


They have been bombarded with startups who are eating their lunch; and the press are piling on…

Industry Disruptors Companies Disrupted

Mobile Handsets Motorola, Nokia, RIM, mobile operators

Taxis All local taxi companies globally

Advertising Broadcast & print media, big brands

Music Music retailers, distributors, labels

Entertainment Movie retailers, content creators

Hospitality All major hotel chains globally

And the rate of technology change is exponentially faster than the speed at which most businesses run


Technology Change

Business Change

Time

Prog

ress

The Opportunity Gap

Top 10 Strategic Technology Trends 2016

1. Device “Mesh”

2. Ambient User Experience

3. 3D Printing Materials

4. Information of Everything

5. Advanced Machine Learning

6. Autonomous Agents & Things

7. Adaptive Security Architecture

8. Advanced Customer Architecture

9. Mesh App & Service Architecture

10. IoT Architecture & Platforms Gartner research, 2015

But at the end of the day, business leaders are racing to better serve customers

Everywhere

Telepathic

Uncomplicated


Quality Price

Simplicity

Immediacy Novelty

Customers

Service Convenience

Personalisation

Consistent Consumer Priorities

New Consumer Expectations


Poll 3: Innovation and Priorities

5. Is innovation a top priority at your company?

1  Yes 2  No

6. What are the top tech-enabled business priorities?

(Text all that apply separately) 1  Better Serving Customers via New Business Models 2  Lowering the Cost to Serve Customers 3  Creating a Better Digital Customer Experience (Mobile / Web) 4  Understanding Customers via Big Data / Analytics 5  Connecting Customers via the Internet of Things 6  Making Customer Interactions Safer via Security 7  Other 8  Don’t Know

Most IT teams are not set up to help the business drive the innovation agenda


TRADITIONAL IT FOCUS: “DELIVER TO REQUIREMENTS”

Demand

Business requirements collection and portfolio mgt (Projects &

Change Requests)

Operate

Develop

Projects & Development

Roll out

Business

Strategic / Tactical Requirements

Day-to-day operations

Solution & Roadmap

Recommendation

IT Operations Application Support

Local Service Desks

Defects & Service Requests

Local support

Escalation of requirements

Power Users

End Users

Process Champions

Process Owners

Business Management

Site Coordinators

Decision, Priority Budget, Release Plan

Requirements Recommendation

Governance Committees

Image Source: Global Company’s IT Operating Model

We’ve developed “DevOps” to move faster, but we have not closed the gap between ‘business’ and ‘IT’


CURRENT IT FOCUS: “LEAN, AGILE DEVELOPMENT AND OPERATIONS”

DevOps Demand

Business requirements collection and portfolio mgt (Projects &

Change Requests)

Business

Strategic / Tactical Requirements

Day-to-day operations

Solution & Roadmap

Recommendation

Defects & Service Requests

Local support

Escalation of requirements

Power Users

End Users

Process Champions

Process Owners

Business Management

Site Coordinators

Decision, Priority Budget, Release Plan

Requirements Recommendation

Governance Committees

ContinuousCustomer

Feedback & Optimization

Collaborative Development

Continuous Release and Deployment

ContinuousMonitoring

ContinuousBusiness Planning

ContinuousTesting

Operate Develop/ Test

Deploy

Steer

DevOpsContinuous Feedback

Image Source: IBM

To address this gap, many companies have adopted a “two-speed” approach to IT


“Two-speed IT”

Rapid iterations

Develop Build Test Deploy

Systems of Record

Slower iterations

Develop Build Test Deploy

Slower iterations

Systems of Engagement

Production

Production

API Catalog

Image Source: IBM

And this “two-speed” or “bi-modal” approach has been strongly advocated by analysts and consultants


45% of IT departments have a fast mode of operation, and by 2017 75% will be bimodal

Gartner research, 2014

“You need to become bimodal because one mode can’t answer the complex

needs of the organisation” Mary Mesaglio, Research VP, Gartner, 2015

“A 2 speed architecture allows companies to preserve transactional technologies

they have come to rely on while exploring innovative consumer facing models” (sic.)

McKinsey & Company, 2015


Poll 4: Two-Speed IT

7. Is your company discussing or adopting two-speed / bi-modal IT?

1  Yes 2  No 3  Don’t Know

8. Two-speed / bi-modal IT is the right operating model for enterprise IT. Do you agree?

1  Agree 2  Somewhat Agree 3  Neutral 4  Somewhat Disagree 5  Disagree


To support the business in closing the gap, a new operating model for business and IT is required

Establish and maintain a ‘platform for innovation’

Support business and

internal / external tech teams with

experiments and pilots

Draw insights on where to improve

solutions and customer

experience

Gain visibility of how new technology is being exploited

The virtuous cycle of

Enabling


Establish and maintain a ‘platform for innovation’

INNOVATION SCOUTING

Identify and understand the most relevant technologies, innovations and market forces from all over the world that could challenge your

business and operating models and inspire new ideas

IDEA GENERATION

Generate, filter, catalogue and prioritise innovation ideas to be

rapidly prototyped

PROTOTYPE

Design, test and learn in short cycles and by engaging

customers in the process

PILOT

Rapidly assess the viability / feasibility and desirability of

ideas based on further customer testing,

integration design / testing

and business case

LAUNCH “Soft launch” the idea in

production to test the concept and learn from a wider set of customers, then industrialise and integrate successful Run proof of concepts and pilots

before integrating innovations into BAU processes

MERGERS AND ACQUISITIONS

Purchase a start-up outright – Integrate with your existing business or leverage the technology, proposition or IP that you have

acquired

STRATEGIC INVESTMENTS

Invest in start-ups for direct financial gain or to gain insights into the business model and innovation proposition they are building

New products, propositions

and service that deliver a rich

customer experience

CHANGE MANAGEMENT & COMMUNICATIONS Drive engagement in innovation across the org

GOVERNANCE Implement appropriate governance and

KPIs that promote innovation


Encourage and support business and internal / external tech teams to experiment

API

Lay

er

Analytics

Customer Experience Design

Systems of Engagement

Data Layer

Infrastructure

Content Management

System

Security

2

6

7

8

1

9

Application and Event Logic

4

5

3

Systems of Engagement Consistent, responsive interfaces across all channels

2

Customer Experience Design Design MVPs that tap into customer emotion and deliver a rich customer experience

1

Application and Event Logic Applications and features supporting customer and business functionality

4

Content Management System Publishing and modification of content including publication governance, verification, forum management etc.

5

Data Layer Secure storage of data (customer data, transactions, performance data, internal data and insights etc.)

7

6

Infrastructure Managing and monitoring the network and processing services supporting the technology

Analytics Analysis and insight of internal and external data to understand trends and provide management information

8 API Layer A set of routines, protocols, and tools enabling internal and external software components to interact

3

CREATE A ‘SAFE SANDBOX’ FOR PILOTS

9 Security Securing the access to and flow of information across systems


Gain visibility of how new technology is being exploited

Research

Speed Dating

Hackathons

Partners

Staff Ideas

Customer Ideas

INNOVATION SCOUTING

IDEA GENERATION & QUALIFICATION PILOT PROTOTYPE LAUNCH


Draw insights on where to improve solutions and customer experience


(Private) Poll 5: Relevance to You

9. Would you recommend this presentation to a colleague?

1  Yes 2  No 10. What is one thing you can do as early as next week to help your business innovate to deliver a better customer experience?

Thank You

appsphere 15 - shining a light on shadow it: a new way of working for "business" and...

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