Internal IT Departments are (almost) Dead - Long Live the Service Provider

Working in an internal IT department has itscompete with;
benefits. If a company has one at all, it is an1. They'll be cheaper
indication of its revenue, after all IT staff aren'tYour skills are generic IT skills, they are not
cheap. One could take this a step further andlocation specific. So, let's go somewhere in the
make the assumption that the package is likely toworld where labour is cheaper and source your
be competitive, relative to the market, and includeskills.
such things as car allowance, interest free loans2. They will only charge for work that they do
and medical cover for you and the family. SoundsYou cost money every day, regardless of
pretty good doesn't it(?). What I think is missingwhether you actually do anything productive or
though is the client to service provider relationship.not.
The IT department is part of the furniture of the3. They will offer guarantees. No delivery, no pay
organisation, it has a monopoly on IT services- simple as that You don't offer any. If is doesn't
within the company. Let's explore this a little.work, you'll carry on clocking up time until it does.
Having an internal monopoly is bad for all parties.4. They will offer fixed price projects. You
Think of the employee, almost without realising itspecify, they deliver, you pay. You won't do this,
he/she has limited their exposure to technologymany can't do this. It's too much pressure for
and the application of it. Of course they have,many.
they are only going to be implementing within thisSo there's just four reasons why your job is on
single company which, presumably, only worksthe line. I know you're probably thinking that your
within a particular market sector, offeringIT department is so huge, it couldn't possibly
particular products. Now I'm not saying that thisundergo such a massive transformation. Be
means people will have experience so narrow thatcareful jumping to conclusions. For many
it's worthless, but it will be narrow. What aboutcompanies what you are thinking is true - at the
the business itself then. They can only go to onemoment. But it only takes one early adopter to
source for advice and implementation. No optionbe the first domino and the rest will either fall into
to use the RFI, RFP approach, conduct supplierline or fall out of business.
interviews or perform commercial negotiations.Consider this. A retail bank, millions of customers,
There are no negotiations here, you have a fixedhundreds working in IT. If a proportion, let's say
internal rate and that's the end of it.only half, where replaced by a service provider
When you work for the supplier (particularly amillions could be saved. If the bank passed on
small one), chargeable utilisation is paramount andthese savings to the customers by way of an
measured constantly. Apply this with rates andinterest rate rise, what's going to happen?
you know exactly what's going on in the bankExactly, customers are going to flock over to the
account. Senior staff don't all have their own PA's,bank. What happens next? Well the customers
fixed overheads are minimised down to flowers inhaven't just been magic'd from thin air, they are
reception and coffee beans for the techies. Ifsomeone else's ex-customers so now they need
utilisation or rate decreases, there is cash burn.to react. Here's where they decide whether to fall
Eventually heads need to roll, literally out of thein line or fall over.
door, so that the company can survive.So now that you know all of this you need to
If that isn't motivation for folk to deliver projectsdecide whether you are doing the right thing now
on time, to budget I don't know what is.to secure your future. What makes you different
Furthermore, this is fairly good motivation toto the many thousands of other people around
establish a good working relationship with yourthe globe that hold the same job title as you? Still
clients so that [a] there is repeat business and [b]feeling cosy?
you've got references and the potential for caseMy final thoughts on this are that there is going to
studies. So where does all of this sit when you'rebe a complete reversal in the way the experience
an internal IT department? It doesn't. So what, Ion our resumes is judged. In the past, and to a
hear you say - none of this affects me in mydegree in the present, you can "get a foot in the
cosy cubicle in my centralised office for my Bigdoor" of Bank A if you've worked in Bank B. But
Brand company. Well, be careful...you might beremember, IT departments are dying so when
wrong.you step out of Bank A you'll need to go over to
Think of this, your company can afford you andthe "light side", the services side. All of a sudden
you're not cheap. You want a car, a bonus, ayou are in a far more commercial environment.
travel allowance, medical benefits, 30 days holiday,Over on this side, people take risks, people make
2 weeks a year training, you want to get paidguarantees, people lose their jobs. So when you
even when you're not working because you'resay, with an air of confidence, "I have X years
"sick" - you are expensive.experience as the manager of this that and the
Stating the obvious now, this means that yourother for Bank A", expect to be hear in response,
employer ahs money, money to spend on IT."I'm sorry to hear that, what part of this
The question is, do you now what this means...?experience makes you think you're suitable
OK, I'll let you in on a secret. It means that otherworking in our commercial organisation"?
people would like that money. They would like toGood luck out there. Take the initiative now, the
earn the money that currently gets paid to you.light side beckons. A moment paused is a
The rest is simple. You see what happens is thatmoment wasted. Look to your creative side, find
someone forms a company to provide ITpeople to collaborate with, seek clients globally and
services. These services include your exact job,build your company. If you don't like this idea, find
the exact job description. But there's are somesome who has already done this and work for
differences, ones that are pretty hard for you tothem!