Does IT Matter (or how Agile is changing what IT means)
In 2003, Nicholas Carr wrote a seminal piece in the Harvard Business Review called Does IT Matter. As we round the corner on 2008, there are a number of trends that point to the fact that the traditional view of IT is indeed changing and Agile techniques are a reflection of this.
When Nicholas Carr wrote Does IT Matter in the Harvard Business Review in 2003 it had a seismic impact on how many CEOs looked at their IT investments. As it often the case with business trends, many in the IT industry were unaware of this article or the ideas that Carr wrote about, however, six years later these trends are becoming unmistakable. Carr basically described that IT as a strategic investment has diminished as open standards and shared infrastructure have reduced IT to a commodity necessary for competitiveness but not sufficient for advantage.
Software As A Service
Since Carr wrote his piece alot has happened in the IT industry with many trends pointing to the accuracy of his assessment. Software as a Service (SaaS) solutions, where an application is hosted by a company and users pay a subscription fee to use its features, are now available for almost every software product area. SaaS solutions are becoming part of every new technology assessment companies perform these days and companies like Salesforce.com are showing they can be serious contenders to established vendors like Oracle and SAP who themselves now have SaaS solutions. The underlying premise of SaaS is that all companies basically use the same product configured for their specific needs. The benefits come from not managing the upgrade/support and enhancement/customization lifecycle that take up a large part of most IT organization budgets and time. Other benefits include the fact that SaaS solutions rely on configuration much of which can be performed by business users without much, if any, IT involvement and companies can easily increase (or decrease) their capacity without worrying about an ever depreciating investment in technology hardware/software.
Managed Infrastructure Providers
This trend is also being seen with the rapid growth of hosted infrastructure services like those provided by companies like Rackspace and thePlanet which offer SAS 70 Type II and SysTrust certifications, complete redundancy, business continuity and a range of other services that even the largest companies have a difficult time providing internally. With the advent of Web Services and XML encoded data transport methods over TCP/IP the ability to share information is increasingly becoming open, accessible and essentially free to any company regardless of size.
Cloud Computing
The convergence of all of this appears to be coming in the form of Cloud Computing initiatives that Amazon and Microsoft are promoting. Cloud Computing introduces another evolution in the multi-tenant, hosted services market by introducing pay-by-transaction services for all of your data center and application needs. The nature of the cloud obscures to some degree the source of the service other than its service level and security obligations. Salesforce.com has a powerful example of this with its AppExchange which leverages the powerful Salesforce.com integration platform to connect applications with little, if any, code. As this model evolves, It will represent the final commoditization of IT functions and has the potential to make IT departments in companies as quaint as the electricity generating departments companies in late 1800s relied on.
The Agile Advantage
So how does all of this relate to Agile? An interesting aspect of Agile practices is that they are all directed towards increasing business throughput, they have little to do with technology. Granted there are many effective agile engineering techniques such as Test Driven Development/Continuous Integration and Emergent Design but these essentially emphasize quality and effective architecture practices. Agile techniques focus on providing outcomes that yield the highest amount of business value through techniques like prioritization, collaboration and transparency. These agile concepts have helped support the move to the commodity oriented IT vision that Carr described in his article.
The Future of IT and Agile
In ten years a number of the most forward thinking large organizations will cease to have IT departments in the form most of us our familiar with. The traditional network operations, application development and application support groups will have been absorbed in the types of models described above. I suspect many companies won't even describe these internal groups as "IT" anymore but as the Business Acceleration department or something similar. These groups will be experts in understanding the entire business value chain and will know how to align business processes to technology enablers. They will focus on risk mitigation and enhancing investment returns through contracts/partnerships and alliances with the technology providers that offer the best orchestration of services. However, all of the agile concepts I mentioned will continue to be leveraged and will be the real focus of these Business Acceleration departments of future organizations.
Software As A Service
Since Carr wrote his piece alot has happened in the IT industry with many trends pointing to the accuracy of his assessment. Software as a Service (SaaS) solutions, where an application is hosted by a company and users pay a subscription fee to use its features, are now available for almost every software product area. SaaS solutions are becoming part of every new technology assessment companies perform these days and companies like Salesforce.com are showing they can be serious contenders to established vendors like Oracle and SAP who themselves now have SaaS solutions. The underlying premise of SaaS is that all companies basically use the same product configured for their specific needs. The benefits come from not managing the upgrade/support and enhancement/customization lifecycle that take up a large part of most IT organization budgets and time. Other benefits include the fact that SaaS solutions rely on configuration much of which can be performed by business users without much, if any, IT involvement and companies can easily increase (or decrease) their capacity without worrying about an ever depreciating investment in technology hardware/software.
Managed Infrastructure Providers
This trend is also being seen with the rapid growth of hosted infrastructure services like those provided by companies like Rackspace and thePlanet which offer SAS 70 Type II and SysTrust certifications, complete redundancy, business continuity and a range of other services that even the largest companies have a difficult time providing internally. With the advent of Web Services and XML encoded data transport methods over TCP/IP the ability to share information is increasingly becoming open, accessible and essentially free to any company regardless of size.
Cloud Computing
The convergence of all of this appears to be coming in the form of Cloud Computing initiatives that Amazon and Microsoft are promoting. Cloud Computing introduces another evolution in the multi-tenant, hosted services market by introducing pay-by-transaction services for all of your data center and application needs. The nature of the cloud obscures to some degree the source of the service other than its service level and security obligations. Salesforce.com has a powerful example of this with its AppExchange which leverages the powerful Salesforce.com integration platform to connect applications with little, if any, code. As this model evolves, It will represent the final commoditization of IT functions and has the potential to make IT departments in companies as quaint as the electricity generating departments companies in late 1800s relied on.
The Agile Advantage
So how does all of this relate to Agile? An interesting aspect of Agile practices is that they are all directed towards increasing business throughput, they have little to do with technology. Granted there are many effective agile engineering techniques such as Test Driven Development/Continuous Integration and Emergent Design but these essentially emphasize quality and effective architecture practices. Agile techniques focus on providing outcomes that yield the highest amount of business value through techniques like prioritization, collaboration and transparency. These agile concepts have helped support the move to the commodity oriented IT vision that Carr described in his article.
The Future of IT and Agile
In ten years a number of the most forward thinking large organizations will cease to have IT departments in the form most of us our familiar with. The traditional network operations, application development and application support groups will have been absorbed in the types of models described above. I suspect many companies won't even describe these internal groups as "IT" anymore but as the Business Acceleration department or something similar. These groups will be experts in understanding the entire business value chain and will know how to align business processes to technology enablers. They will focus on risk mitigation and enhancing investment returns through contracts/partnerships and alliances with the technology providers that offer the best orchestration of services. However, all of the agile concepts I mentioned will continue to be leveraged and will be the real focus of these Business Acceleration departments of future organizations.