For decades, information technology drove efficiency. Significant investment in information technology was a way to create barriers to competitive entry. That was then. Now apps and commodity infrastructure are a click away on a pay-as-you-go basis. Owning a data center is no longer required. Expeditiously deployed, differentiating software is the business imperative.
Traditional business shared-services functions, by definition, are not competitive differentiators, thus software supporting shared services is not differentiating. Infrastructure is not differentiating. Rather than build, businesses should consume market service offerings (the cloud) for non-differentiating business efficiency.
The biggest obstacle to mastering this new world for most companies is the burden of its technology legacy. Technology legacy is a sunk cost that should not influence or impact smart, going-forward business decisions.
In the past, information technology was behind the scenes supporting the business. Entire industries are being “Amazoned” by disruptive entities using technology as the front door with ongoing customer relationships sustained by technology. A customer’s technology experience defines the brand.
Business users were once the first to experience technology. PCs were the norm in the office and on the factory floor long before computers were in use at home. The business user accepted technology at the pace that the business doled it out. That was then. Over the last decade the consumer technology market leapfrogged the business world. Traditional business has been struggling to keep up with its technology savvy employees, and its customers’ expectation for easy information access and seemingly effortless multi-channel transactions utilizing their device du jour.
Relevant business technology is all about software now — specifically customer-facing software that eases information/transaction access, and software bundled into the company’s product or service offerings that add innovative, unique function. That software-defined customer experience and connectedness is crucial to future business vitality. The composition of a “product” has been expanded to include software. A firm’s customer experience needs to be managed in a product management context. Product management in a software defined world must confront the increasingly shortened time frame between innovation and commoditization. Speed to market is crucial.
Firms must move beyond traditional organizational norms. Differentiating software requires constant collaboration between software development professionals and their business product manager. Business subject matter experts define required innovation, technology professionals enable innovation. Technology resources must be embedded on the front line within business operating teams, not centrally isolated.
Today’s business leaders are defining critical business strategy that anticipates conditions over the next three quarters, not three years. That strategy depends on nimble software development capabilities that can deploy competitively differentiating software within days or weeks. The legacy IT world typically consumes 70 percent-plus of IT resources and budget to maintain past business value. Enlightened corporate leaders are laying out a technology investment plan for their future operating model that devotes 70 percent-plus of technology resources and budget to a software development dominated team, aligned by product, that enables differentiating innovation – now.
About The Author
Joe Blomker is CEO of Maryville Technologies.
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