When IT Doesn't Choose Applications

May 13, 2013 (05:05 AM EDT)

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For this column I have passed the editorial baton to my colleague Tom Petrocelli. Tom is ESG's social media guru and highlights not only how crucial these new tools are to the development of IT from an application and value perspective, but also reminds us how such dramatic changes in what IT does also have an intense impact on how IT does -- or at least should do -- things. Whether that's storage, security or servers, the world becomes different. -- Mark Peters

Business applications are the apex predator of the IT world. All the servers, storage, routers and switches, virtualization software, databases and middleware in enterprise IT organizations exist to deploy applications to knowledge workers.

Until recently, corporate IT has been responsible for delivering the meat to feed the application beast. Now, a shift is changing the traditional IT role and the impact is only going to get more radical. Non-IT professionals -- managers of other business functions and other knowledge workers in general -- are buying their own software and apps and services. Even when they're not the actual buyers, it is pretty clear their influence over the business application purchase is growing. Recent research from ESG indicates that as many as 42% of knowledge workers either influence, sign off on, or outright make purchase decisions for business applications.

[ Need to do a better job of plugging security holes? Read Who Owns Application Security, Patching In Your Business? ]

The reason for this transfer of buying power is, in large part, because the expectations of knowledge workers have already shifted. The average knowledge worker is used to procuring his own software for personal use via browsers and – albeit to a lesser degree to date - as mobile applications. Knowledge workers' empowerment as technology consumers is spilling over into their working lives.

That's the motivation. And the means is cloud-based applications. When knowledge workers were asked how they access business applications not provided by their IT organizations, the most common method was via a browser on their desktop or laptop. Browsers provide a convenient method not only of deploying on-premises applications and sanctioned cloud applications, but also buying applications without IT involvement. Knowledge workers are no longer willing to wait for IT to go through a lengthy process to procure applications when they know they can buy them from a cloud application provider with their own money, on a subscription, and often with a credit card. In short, they are buying their own software because they want to and they can.

This trend has several crucial ramifications for both vendors and traditional IT departments:

1. Application Vendors No Longer Can Rely On Selling On-Premises Software To IT Departments.

Software vendors have to contend with a totally new customer. Vendors that do not embrace the knowledge-worker buyer will be the vendors left out in the cold in the future. This will drive changes to sales, marketing, service and especially support. No longer can software vendors expect the buyer to be a technology savvy IT person with a technologist's expectations. Instead, vendors must contend with buyers that have more domain knowledge than they do, but much different expectations of technology. Subsequently, cloud applications have to be like electricity -- something that "just works" for people who have neither an idea nor especially care about how it works.

2. IT Can Control -- But Not Stop -- Non-IT Buying.

Most knowledge workers (73% in ESG's research) claim that they never access non-IT-provided applications in the presence of a clear policy prohibiting such access. That doesn't mean they don't want to. The flip side is that nearly a quarter of knowledge workers will still access non-IT approved applications even with a policy against it. Pressure to allow knowledge workers the ability to safely choose their own applications will only increase. And fighting the trend will only encourage knowledge workers to go around IT.

3. IT's Role Is Changing.

This, for IT, is an "adapt or die" moment. IT is becoming less about implementing technology and even more about helping their organizations find innovative ways to use tech to achieve business goals. The IT professional's role is moving from a technologist to a business strategist. Over time, many of the technology development, maintenance and deployment roles will be performed by the software or cloud infrastructure vendors and not in corporations. This is -- and one has to be wary of such assertions -- surely a paradigm shift.

4. Hardware Will Shift With Software.

Because hardware exists to make software possible, it will go where the software goes, in this case to cloud providers and software vendors. This will drive two changes for hardware vendors. First, a portion of hardware customers will change from corporate IT to software vendors and cloud service providers. Because the software vendors take responsibility for the infrastructure they -- or cloud infrastructure partners -- will be buying more of the hardware in the future. Second, the infrastructure they deploy will need to be on a very different scale than is typical in corporate IT, capable of managing an enormous number of users. For cloud software vendors to make money, they need to aggregate as many customers as they can. The infrastructure will be on an Internet scale, not on a corporate scale.

5. Security, Regulatory Compliance, Availability, Privacy Will Still Be Problems.

When someone buys from a cloud application vendor, there needs to be a lot of trust -- trust that the vendor will maintain a highly secure, highly available environment; trust that there will be a way to place a legal hold on data and ensure regulatory compliance; trust that the software vendor, now holding mission-critical information, will continue to support the application the company relies on or won't simply go out of business.

This is another instance where strategic IT is critically important. IT professionals are the ones who have the training, experience and knowledge to ask the right questions and assess the answers. They know whether a particular application aligns with all of a company's needs, not just the surface needs of a functional unit of the business. The non-IT buyer might not consider these factors and instead buy an application that doesn't really support the business.

Knowledge workers are feeling empowered enough by their experiences with sophisticated consumer software to buy business applications at work, sometimes with the blessing of the IT department. For managers especially, waiting months for an IT-delivered solutions seems a waste of time when they can get most of what they need in a browser from a cloud application vendor. And the risk of purchasing your own cloud applications continues to diminish as large enterprise business applications such as SAP, Oracle, and Microsoft continue to make their top business applications available using a cloud subscription model.

The non-IT buyer trend will continue into the future and have a profound effect on the relationship between IT, vendors and end users. IT will always be relevant as the technology guides for the companies, providing strategic advisement. It will especially be needed to evaluate vendors on technical dimensions and help ensure business-technology alignment.

Programmers will always find a place designing and writing specialized code and building integration points between applications that vendors do not provide. For many in corporate IT, however, their role as technologists will diminish.

Software vendors will need to understand their new customers better. This is true for vendors who need to understand more deeply the non-IT buyer and hardware vendors adapting their products, service and sales practices to giant cloud companies where downtime means not one angry company but thousands.

There is still time for IT to manage this transition. IT policy needs to address the inevitable knowledge worker-empowerment issue. Creating guidelines to allow safe buying habits will certainly help. Corporate application stores, which allow knowledge workers to choose preapproved applications that are safe and secure, are either nonexistent or unknown to knowledge workers. IT should consider establishing and promoting these app stores because they represent an obvious method of meeting both the needs of the corporation and the needs of knowledge worker.

Finally, creating a partnership between knowledge workers, vendors and IT is essential to stemming chaos in future corporate business applications. IT has the opportunity to take the lead and become the internal partner that empowered knowledge workers and companies desire.