structuring it for integrated systems - cdm media€¦ · adopt new processes for faster solution...

A Forrester Consulting

Thought Leadership Paper

Commissioned By IBM

August 2013

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Structuring IT For

Integrated Systems How IT Will Reorganize For New-

Generation Platforms — And Achieve

Business Responsiveness

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Table Of Contents

Executive Summary ........................................................................................... 3

Business Pressures Driving New Responsive IT Structures ....................... 4

A Leap In Responsiveness Requires A New IT Organizational Structure.. 5

Welcome To The Future: The Responsive IT Organization .......................... 7

Your Transformation Will Take Years — So You Should Start Now ......... 11

Appendix A: Methodology .............................................................................. 14

Appendix B: Endnotes ..................................................................................... 14

ABOUT FORRESTER CONSULTING

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© 2013, Forrester Research, Inc. All rights reserved. Unauthorized reproduction is strictly prohibited.

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are trademarks of Forrester Research, Inc. All other trademarks are the property of their respective

companies. For additional information, go to www.forrester.com. [1-M321V0]

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Executive Summary

To meet business demands for more solutions faster at

lower costs, IT leaders are transforming their systems,

organizations, people, and processes. Much faster delivery

of solutions is only half of the challenge; systems and

business process integrity must complete the picture. A key

strategy: Adopt systems that pre-integrate servers, storage,

networking hardware, middleware, and data management

software. Why: to eliminate manual spec’ing, installation,

and configuration labor and enable automated deployment

and change management. These “integrated systems”

deliver the greatest benefits when supported by IT

organizations that converge and integrate today’s

stovepiped functions.

In a September 2012 study commissioned by IBM,

Forrester Consulting described how adoption of integrated

systems prompts IT leaders to converge technical roles and

adopt new processes for faster solution delivery (e.g.,

DevOps). In February 2013, IBM commissioned Forrester

Consulting to extend this research to determine the best IT

organization to support integrated systems.

In our interviews, 10 enterprise IT leaders strongly

supported our hypothesis that the ideal IT organization will

encompass six major groups reporting to the CIO.

Previously separate data center operations groups

converge into a single “systems engineering” organization.

An “application platform engineering” group unifies separate

middleware and platform specialists. Distinct business-

focused organizations deliver business and analysis

applications. Cross-cutting teams will manage: 1)

risk/compliance, and 2) strategy, portfolio management, and

user support.

How will enterprises adopt this new IT structure?

Interviewees had more questions than answers to this. All of

them start by adopting integrated systems and reforming

their systems operations and application development

groups. All expect to make even broader organizational

changes over time. The journey from today’s siloed

organizations to responsive IT will easily require five years

to complete.

KEY FINDINGS

Forrester’s study yielded three key findings:

› Integrated systems take out manual configuration

and increase use. Our first study highlighted application

project delays caused by manual configuration of

hardware and middleware. Manual assembly, installation,

and configuration are untenable as applications become

orchestrated collections of APIs to back-office

transactions, code running on devices, and cloud-based

services. Integrated systems, including cloud platforms,

attack this issue through preconfiguration and automated

deployment and updating.

› Business responsiveness with integrity requires six focused service organizations. Responsive IT

organizations have six major teams, far fewer than

today’s typical IT organization. Each team has a narrow

focus on responsiveness within its own domain and

provides services to the other teams. A variety of

“contracts” govern relationships between the teams.

› The new IT organizations will drive both top- and bottom-line benefits. The revenue benefits: 1) faster

business innovation with products and services, including

rapid service iterations to meet changing customer

preferences, and 2) high business service availability

despite constant iterations. The cost benefits: 1) high

service reuse to cut development costs; 2) ability to run

more services on fewer systems; 3) reduction in “keep-

the-lights-on” IT labor; and 4) lowered costs of scaling IT

systems to keep pace with business volumes.

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Business Pressures Driving New Responsive IT Structures

Too often, IT projects today are delivered late and over

budget. A commissioned study by Forrester Consulting on

behalf of IBM found these poor outcomes in about 25% of

large IT projects (see Figure 1).1 A key cause: manual

configuration of hardware and middleware products to

create systems. Manual configuration also causes

downtime after upgrades.

“Customers want more features,

faster, for less money. [To respond,]

we’re pushing integration to the

maximum.”

— Director of IT, healthcare management firm

FIGURE 1

Business To IT: Improve Solution Delivery

1Base: 155 US respondents

2Base: 119 respondents whose project deployed behind schedule (Multiple choices allowed; percentages don’t total to 100%)

3Base: 119 respondents whose project deployed behind schedule (Multiple choices allowed; percentages don’t total to 100%)

4Base: 279 respondents who experienced application downtime

Source: A commissioned study conducted by Forrester Consulting on behalf of IBM, December, 2011

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A Leap In Responsiveness Requires A New IT Organizational Structure

Our hypothesis: Business responsiveness requires not only

new systems such as integrated systems and cloud

platforms, new delivery methods such as Agile, and new

technology such as mobile applications. Responsiveness

requires new IT organizations. Today, most enterprise IT

groups organize to control costs and ensure data integrity;

the new organizations will organize for responsiveness (see

Figure 2). Integrated systems are the foundation enabling IT

to overcome four barriers.

“We need tight coupling between how

apps are built and how business

prioritizes features.”

— IT leader, specialty publisher

FIGURE 2

The Four Highest Barriers To Responsive IT

Source: A commissioned study conducted by Forrester Consulting on behalf of IBM, April 2013

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IT IS ALREADY ADOPTING INTEGRATED SYSTEMS

Many organizations have begun to move to integrated

systems to replace their stovepiped collections of servers,

storage, and middleware — either in new on-premises

products or in cloud services (see Figure 3). The resulting

standardization and preconfiguration of hardware

infrastructures and middleware eliminates the need for

manual assembly and configuration by specialists, as well

as more intensive and flexible use of systems.

NEW ORGANIZATIONAL STRUCTURE NEEDED TO MAKE THE TRANSFORMATION

New integrated systems won’t magically make IT

responsive to the business. IT organizations and practices

that take advantage of the new, more flexible infrastructures

will. Enterprises adopting integrated systems tell us they’ve

begun a journey to a new IT organizational structure that is

in tune with their newfound infrastructure flexibility (see

Figure 4).

FIGURE 3

Integrated Systems Preconfigure, Standardize, Automate

Source: A commissioned study conducted by Forrester Consulting on

behalf of IBM, April 2013

FIGURE 4

The IT Organization Of The Future



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Welcome To The Future: The Responsive IT Organization

Business responsiveness requires new levels of

communication and understanding, coordination of

activities, and speed of both application delivery and

gathering of customer feedback. In these organizations, six

IT groups are structured as service providers focused on

business innovation within their domains on business

schedules (see Figure 5). Each team both builds services

and brokers access to external services. Integrated systems

provide the foundation.

“The solution is connecting all of the

pieces without a lot of handoffs.”

— Systems engineering leader, integrated financial services

firm

FIGURE 5

Chart Of Responsibilities In The New IT Organization


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APPLICATION DELIVERY TEAMS REFLECT MAJOR BUSINESS DOMAINS — AND TWO TYPES OF APPS

Within the new IT organization, application delivery groups

have both technical talents and business knowledge.

Business applications teams and data analytics teams are

distinct to recognize that reality in the solutions they deliver.2

Each delivery organization also includes a business architect

to both provide strategic advice on technology to business

leaders and to orchestrate and guide service providers on

issues like future capacity needs (see Figure 6).

FIGURE 6

App Delivery Organized By Domain And Type


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CONTRACTS GOVERN SERVICE RELATIONSHIPS BETWEEN THE TEAMS

Each of the six major groups is also a consumer of services.

Services are standardized and governed by contracts,

which take various forms. Figure 7 shows the major

contracts between teams — contracts govern types of

services (or results) provided, service-level commitments,

and planning-architectural guidance such as portfolio plans

and security-design conventions (see Figure 7).

FIGURE 7

Organizational Foundations: Service Providers And Contracts


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IT ROLES CONVERGE AS LOW-LEVEL SKILLS LOSE VALUE . . .

Responsive IT organizations need professionals with broad

skills more than narrow technical specialists. Integrated

systems eliminate the need for component configuration,

replacing it with systems configuration. DevOps engineers

join software development teams. The new IT role players

combine separate disciplines while adding new knowledge

(e.g., cloud administration) so they can specialize in design,

architecture, and business innovation (see Figure 8).

. . . AND ALL IT ROLE PLAYERS CLIMB UP THE APPLICATION STACK

In responsive IT organizations, everyone climbs “up the

stack” to get closer to the business. Everyone provides his or

her piece of business solutions when needed, and every IT

pro’s business value is obvious. The new “infrastructure

engineers” create infrastructure patterns and scripts that

developers can use to obtain high availability, security, and

other qualities of service. DBAs move up the stack to offer

data services aggregating many sources. DevOps engineers

can quickly and safely deploy a software module to support a

business innovation into production (see Figure 9).

FIGURE 8

Narrow Technical Roles Combine And Converge



FIGURE 9

All IT Roles Move Up The Stack



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Your Transformation Will Take Years — So You Should Start Now

In our research for this paper, we found few who argued

against the broad transition in IT organizational structures

we’ve outlined. The debates were about how to make the

set of changes we postulate are necessary for business

responsiveness. Each IT organization will follow its own

path, but all will complete four prerequisites (see Figure 10).

“On our applications, the transition

will take five to 10 years. In our

infrastructure world, we’re moving

much faster.”

— IT Leader, European university

FIGURE 10

The Four Prerequisites for The New IT Organization


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PLOT YOUR PATH: TOP-DOWN VERSUS BOTTOM-UP

The path your organization takes to a new responsive

structure may be unique. However, we can at this early

stage recognize three major paths for the journey, each of

which has its pros and cons (see Figure 11). We prefer the

top-down migration path, as we believe it is best for driving

the broadest long-term benefits.

EACH ENTERPRISE HAS ITS OWN JOURNEY

Each of the IT leaders on our research panel for this project

described a journey from traditional stovepiped IT to the

organizational structure and key processes we describe. The

most striking aspect of these interviews was the strong

support for our fundamental ideas about how IT will be

organized in an era of integrated systems and continuous

delivery. Our panelists moved quickly from the “what” of the

new organizational structure to the “how” (do we get there?).

Our panel for this project was small in size but

representative of the range of enterprises we see in our

research and advisory work. Included were a European

university, three integrated global financial management

firms, a global consumer brand company, a US state

agency, a global telecommunications firm, a specialty

publisher, an international printing and publishing firm, a

research nonprofit, a European governmental agency, and

a European healthcare firm.

All of our panelists are driving toward responsive IT; several

of our panelists are aggressively pushing big organizational

and technology changes now. One interviewee told us: “We

just let go of [our] VP of [IT] operations because he refused

to adapt to the new model.” In this company, the CEO is

driving a deep transformation including IT.

But most are moving deliberately and trying to help their

current staff evolve into new roles and new organizational

structures. “Transition is happening [for us] in infrastructure

first,” the IT director of the university told us. “Why? It’s

possible to do convergence at reasonable costs using tried

and tested methods. I can’t move operational work away

from development teams across the board. Where I can, I

am edging toward this model.”

In addition to infrastructure consolidation, Agile

development and continuous delivery methods are also

starting points for the transition. “The relationship with the

business is changing,” said an IT leader at an international

telecommunications firm. “Product owners now must be

involved throughout each [development] sprint.”

FIGURE 11

The Three Migration Paths To Converged, Integrated IT



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Said an IT leader at a global financial services firm: “Our

application development teams focused on reducing time-

to-market. They’re going back to the idea of a ‘solution

team’ including software engineers, business analysts, and

support analysts.”

Those staff include CEOs and senior business leaders who

like the prospect of fast solution delivery but aren’t yet

confident they can control its costs and risks.

IDENTIFY YOUR GOALS: THERE ARE ONLY FOUR BENEFITS THAT MATTER

A multiyear transformation program must achieve big

benefits that businesspeople immediately understand.

Figure 12 shows the four benefits we observed among the

organizations on the path to responsive IT and integrated

systems. These organizations have intermediate goals to

reform their organizations, narrow their technology stacks,

and re-engineer their release, portfolio-management, IT

service-management, and developer support processes.

But they put those smaller goals in the context of the larger

objective of putting IT on a completely different footing

within the business.

FIGURE 12

The Four Business Benefits Of Integrated Systems And The New IT


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Appendix A: Methodology

In this study, Forrester interviewed 10 global enterprise IT executives whose organizations are currently transitioning to

integrated systems to evaluate organizational models for integrated systems and best practices to prepare organizations to

utilize integrated systems. Respondents were offered a financial incentive as a thank you for time spent on the interview. The

study began in February 2013 and was completed in May 2013.

Appendix B: Endnotes

1 Our study gathered data about only one large web or BI project from each respondent. For entire portfolios, the rates of

failure, missed schedules, and blown project budgets are typically much higher.

2 Data analytics teams provide enterprise wide reporting and analysis applications and data warehouses and feeds. Business

applications teams will often build analytics specific to their applications, and not rely on their data analytics colleagues for that functionality. The split between business applications and data analytics teams we advocate is the most controversial aspect of the model. These functions tend to be split today in the largest enterprises, but the split is by no means universal.

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