Ladies And Gentlemen, Corporate IT Spending Has Left The Boardroom

Author

Adrian Bridgwater, Contributor

July 9, 2015

Corporate IT spending is on the move. Obviously the CEO is not dead, nor is the chief financial offer (CFO) or the chief information officer (CIO) for that matter… but changes are afoot. The current renaissance witnessed in information technology sees multifactorial but essentially decoupled service-based chunks of IT (you can just say ‘cloud computing’ and virtualization if you prefer) now impacting the way technology itself is procured.

Composable decoupled IT

At one level, we see cloud services and composable technologies becoming more common in the enterprise. This means that software application developers themselves have the potential to take over the traditional role of IT purchasing and budgeting. Logically then, if software is chosen (and procured) in smaller granular pieces, it is easier to select but harder for any C-level executive to exercise buying control.

According to cloud communications platform company Twilio, “The line between buying and building is blurring as developers combine and customise off-the-shelf technologies today.”

Compounding the ‘problem’ here, a growing amount of software spend is happening completely OUTSIDE the IT department anyway. The clue is, it’s not necessarily a problem.

According to Gartner analyst Richard Gordon, “[As much as] 30% of IT spending in large enterprises happens outside the IT organization [in the hands of actual users] and that figure may grow to 50% in the next few years.”

It’s a good thing and a bad thing

One the one hand, we could argue that a new breed of IT buyers is emerging and that savvy CIOs should embrace this so-called ‘shadow IT’ as an opportunity to inject agility into their enterprise.

On the other hand, we could argue that a firm is losing total architectural vision of its IT stack and that these ‘granular additions’ from both developers and users will ultimately serve to fragment and weaken the total stack of IT that any particular firm wishes to operate.

Developers are not just driving decisions about their immediate toolset, but exerting growing influence on strategic decisions about what services their business will use says Twillio. That is to say… there is direct efficiency here if we embrace the opportunity to get the right software (and the software people prefer using) working more quickly.

Twilio CEO Jeff Lawson suggests that, “Although this situation does potentially complicate tracking IT spending, it is important for businesses to understand that developers taking decisions into their own hands can improve service, identify solutions and ultimately save money. Vendors need to understand the new reality as conventional sales routes dwindle.”

Justification for fragmentation?

The position from Twilio spokespeople is that this fragmentation of purchasing is essentially a good thing. But then they would say that wouldn’t they? The firm sees over 700,000 developers and businesses in over 200 countries use the Twilio platform and APIs to run a range of software from complete call centres to simple scheduling applications — and from mobile marketing and lead management to security tools. So… it’s all about composable component parts of applications being made to work together, successfully.

Accordidng to a press statement, “Twilio’s versatility, ease of use and interoperability makes it a favourite of developers looking for integrated solutions across voice, SMS, chat and video communications. Twilio reciprocates with an intense focus on developer outreach and evangelism. The company adds one developer every 90 seconds to its platform and 35 of the 101 global unicorns are built on Twilio. Currently 22 billion API requests logged and one in five people across the world has interacted with Twilio.”

It’s easy to look at this situation both ways i.e. so-called ‘shadow IT’ is almost never spoken about in a positive light, although this is effectively where the Twillio technology proposition puts us. But fragmentation and decoupling is an unavoidable truth just now, so we need to think about the way software components are coming together.

The best advice here is approach this subject with informed but cautiously suspicious minds.

This article was written by Adrian Bridgwater from Forbes and was legally licensed through the NewsCred publisher network.


There is 1 comment

  • Week 28 | import digest - 09/06/2015 00:44
    […] IT spending has “left the boardroom” and is increasingly procured through “shadow IT” […]

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