The question to Warren Ritchie, CIO at the Volkswagen Group of America, was pretty standard: What was the biggest surprise he faced when he came into the IT world? Ritchie was speaking at the recent Forrester IT Forum in Las Vegas. He hemmed and hawed and let out a little sigh. “Not a surprise,” he said. “I had an inkling of it. I didn’t realize the magnitude of the issue.”
Ritchie, who was named Volkswagen’s CIO in 2008, was referring to the proliferation of rogue IT in business, and the general lack of understanding about its inherent risks. Volkswagen’s top executives understood what it took to run their business operations, of course, but he discovered they knew much less about IT operations than he had supposed. He was taken aback by “the general lack of appreciation of the complexity of running an IT environment and … what it takes to manage it.”
Ritchie has a doctorate in business strategy, as well as a longstanding interest in the relationship between organizational structures and business success. In fact, most of his 24-year career at Volkswagen has been spent on the business side. So, he certainly wasn’t up on stage to whine about rogue IT and his business peers’ lack of insight into enterprise IT. Rather, he was describing the coordinated changes IT and the business side were making to help the company compete more effectively in the era of the connected car. It’s no secret that Volkswagen has been slower to capitalize on the digital car than some of its competitors, notably Ford; and Ritchie — with the right IT team — has an opportunity to seize the moment and take the lead in this area.
It was therefore surprising to hear this business-savvy CIO talk about the need “to educate the business” on what it takes to run enterprise IT. Especially because all the talk at this conference — and at most other IT conferences for that matter — is about how CIOs must keep up with the business or be left in the dust by tech-savvy employees (aka rogue IT cowboys) who can self-provision the technology they need to do their jobs, thank you very much, pardner.
The biggest challenge in IT innovation is doing the change management part correctly, Ritchie said. His business partners needed to understand, for example, that they can indeed get a great “above-the-water-line strategy” for connecting with the connected cars of their customers by going around IT, but that the solution will “not leverage our internal managed services, and it is not going to leverage our internal app functionality.”
Ritchie let his business partners know that rogue IT solutions might get them off to a fast start, but “we’ll be slow, as a corporation, to take advantage of it.” Instead, he argues for IT and the business working together on the plumbing.
Maybe IT is the victim of its own success. CIOs and their departments provide all manner of IT solutions to business challenges, but over time these systems become a routine part of business operations — so much so that they begin to be disconnected from their original enterprise IT roots.
This view or opinion was evident in Forrester’s latest survey of some 2,000 business leaders on how businesses interact with technology. While 87% of the leaders told Forrester they believe the future of their organizations hinges on technology innovation, more than one-third (35%) said they don’t consider IT to be a source of technology innovation. Almost two-thirds (65%) said they have budgets to buy technology within their group, without involving IT. Of the so-called Generation Y employees (those 18 to 30 years old) surveyed by Forrester, 64% said they download unauthorized applications or websites at least once a week to get their jobs done; and at least 40% do the same every day.
We live in a golden age of rogue IT. Ordinary schmoes like me can download apps to do our work. Business departments rent software over the Internet to carry out critical business functions. Amateur developers build business applications in the cloud.
But without the scalable, secure and integrated features that only IT departments can manage, these quick fixes will fall as fast as they rise — or worse, sink the enterprise.