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By Dr. Arthur M. Langer
The first article of "The Langer Report" discussed how IT can be divided into two distinct kinds of business operations: Drivers and Supporters. In that article I defined the key essential attributes of what Driver means and how IT organizations can take advantage of working with their business units to maximize their value.
In this article I want to put the Supporter component into perspective. I defined a Supporter technology as one that does not affect the relationship between the organizations clients-that is, it has no material effect on the marketing of the firm's business. Specifically I stated:
Supporters are units that do not generate obvious direct revenues but are designed to support front-line activities. For example, operations such as internal accounting, purchasing, or office management are all classified as supporter departments. Supporter departments, due to their very nature, are evaluated on their effectiveness and efficiency, or economies of scale.
We know that most traditional IT departments are designed to be Supporters; they have a close knit organization that is secure from outside intervention and geared to respond to user needs based on requests. It is important to recognize that being a Supporter does not mean that you are not important! Rather it means that the basis of evaluation is simply different.
Here are some important tips and strategies for maximizing your value when you are a Supporter:
- The IT service is a commodity-view it that way.
- Low cost for high value must be delivered.
- Understand that the business might have alternative ways to implement the solution-you should also provide these alternatives.
- Do not over-discuss the details of delivery.
- Daily participation with the business may not be valued.
- Costs are less negotiable.
Another aspect of Driver-and-Supporter functions is the concept of a "life cycle." A life cycle in this respect refers to the stages that occur before a product or service becomes obsolete. Technology products have a life cycle of value just as any other product or service.
Many technical products are adopted because they are able to deliver value-value that is typically determined based on ROI calculations. However, as products mature within an organization, they tend to become more of a commodity; and as they are normalized, they tend to become support oriented. Once they reach the stage of support, the rules of economies-of-scale become more important and relevant to evaluation. As a product enters the support stage, replacement based on economies-of-scale can be maximized by outsourcing to an outside vendor who can provide the service cheaper. New technologies then can be expected to follow this kind of life cycle, where their initial investment requires some level of risk in order to provide returns to the business. However, once the technology is "assimilated" and organizational behavior and structures are normalized, individuals will use it as a permanent part of their day-to-day operations. Thus, Driver activities give way to those of Supporters. Senior managers become less involved and line managers then become the more important group that completes the transition from Driver to Supporter. Figure 1 illustrates the cycle.
Figure 1: Driver-to-Supporter Life Cycle
The above Life-Cycle can be correlated to the classic "S-Curve," where new product/service offerings go through a transition from high market value to eventual commoditization. Therefore, a CIO must know where the product is in relation to the "S-Curve" or Driver/Supporter Life Cycle. Here are a few key things to never forget:
- Business units better understand the articulation of a driver/supporter than they do IT business jargon.
- IT needs to know if the project is a driver or a supporter before formulating strategy.
- Drivers/Supporters are both important, but they are measured differently.
- Current supporters can become tomorrow's Drivers.
My next article will explore the organizational impact of operating your IT departments as Drivers and Supporters, and how this can be accomplished.
Columbia University's Dr. Arthur M. Langer is Senior Director of Technology, Innovation and Community Engagement, Fu Foundation School of Engineering and Applied Science; Associate Director, Instruction and Curricular Development, School of Continuing Education; and a faculty member in the Graduate School of Education (Teachers College) and Continuing Education. He also is a member of the CIOZone's advisory board.
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