CIOs seek to Transform IT Departments into 'Internal Service Providers' as Line of Business Power Shift Gathers Pace - Business Driven IT Selection Moves out of the Shadows

Dec 03, 2014, 04:00 ET from Logicalis

SLOUGH, England, December 3, 2014 /PRNewswire/ --

Shadow IT goes mainstream: A quarter of CIOs have lost control of ICT spending but plan to regain control through service-focused transformation 

Logicalis, the international IT solutions and managed services provider, has released its second annual Optimal Services Study from a global survey that was completed by 177 CIOs spanning 24 countries.

In the survey CIOs are acknowledging that the balance of power in ICT spending has already shifted decisively and shows no sign of slowing down, as the trend up till now called 'Shadow IT' increasingly takes centre stage:

  • 57% of CIOs think line of business (LOB) colleagues have gained more power over the last 12 months
  • More than a quarter (28%) admit that LOB colleagues already hold the balance of power in ICT decision-making, taking 50% of decisions or more
  • 64% believe the trend will continue over the next three to five years (compared with 44% who said the same 12 months ago)
  • Two thirds (66%) report that the IT department is responsible for managing LOB purchased technologies and services.

In response, CIOs are seeking to embrace a new, infrastructure and service management-focused role.  

Mark Rogers President and COO of Logicalis Group comments: "All of this means that customers will require us to help them become even more service defined - this means we will not only have to help the CIO transition their organisations, but crucially we have to better capture and deliver this multi-sourced business driven agenda, but also more clearly demonstrate how new technologies or services translate into tangible business improvements and outcomes."

CIOs recognise, however, that there is much work to do in order to deliver this service-defined transformation.  

Become experts in service integration - Line of Business will now want access to a growing number of market offerings delivering transformational line of business applications -  making the selection, integration, governance and management of 'as a service' as important as maintaining in-house technologies:

Transform the IT skills base - They will have to recruit specialists with broader, business IT orientated skills, they must actively reduce the level of technology their teams maintain in house, and they must succeed where they have so far failed - in refocusing the CIO role on strategic activities:

To read the full Optimal Services Report, Establishing the internal service provider, visit: http://www.logicalis.com/knowledge-share/downloads/optimal-services-study-2014-research-paper/logicalis-optimal-services-study-2014/

Commenting on the findings, Chris Barnard, Associate Vice President, IDC, said:  "The Optimal Survey Results 2014 confirm major trends IDC observes within the industry with the shift to a new technology platform - the Third Platform, which is built on mobility, cloud, big data analytics, and social technologies. This creates challenges to the CIO and IT organisations as they struggle to balance strategic and operational choices.

"With the IT function at the heart of business growth and innovation as we move to the Third Platform, it is clear that the CIO and IT organisation will have to adjust as business outcomes become the key metric of ICT projects. Discussions need to move from being technology focussed towards supporting business goals by acting as a services broker or provider.  An external partner, such as Logicalis, should understand the key role of the network and provide complete enterprise platform lifecycle services, with a keen understanding of the IT estate and future business/technology evolution."

About Logicalis 

Logicalis is an international IT solutions and managed services provider with a breadth of knowledge and expertise in communications and collaboration; data centre and cloud services; and managed services.

Logicalis employs over 3,800 people worldwide, including highly trained service specialists who design, specify, deploy and manage complex IT infrastructures to meet the needs of almost 6,000 corporate and public sector customers.  To achieve this, Logicalis maintains strong partnerships with technology leaders such as Cisco, HP, IBM, CA Technologies, NetApp, Microsoft, VMware and ServiceNow.

The Logicalis Group has annualised revenues of $1.6 billion, from operations in Europe, North America, Latin America and Asia Pacific, and is  one of the leading IT and communications solution integrators, specialising in the areas of advanced technologies and services.

The Logicalis Group is a division of Datatec Limited, listed on the Johannesburg and London AIM Stock Exchanges, with revenues of approximately $6 billion.

For more information, visit http://www.logicalis.com.

SOURCE Logicalis