Why "Running IT As a Business" Is a Bad Idea

snydeq sends along a provocative piece from Infoworld, arguing that the conventional wisdom on how IT should be run is all wrong. "Bob Lewis dispels the familiar litany that 'IT should be run as a business,' instead offering insights into what he is calling a 'guerilla movement' to reject conventional 'IT wisdom' and industry punditry in favor of what experience tells you will work in real organizations. 'When IT is a business, selling to its "internal customers," its principal product is software that "meets requirements." This all but ensures a less-than-optimal solution, lack of business ownership, and poor acceptance of the results,' Lewis writes. 'The alternatives begin with a radically different model of the relationship between IT and the rest of the business — that IT must be integrated into the heart of the enterprise, and everyone in IT must collaborate as a peer with those in the business who need what they do.' To do otherwise is a sure sign of numbered days for IT, according to Lewis. After all, the standard 'run IT as a business' model had its origins in the IT outsourcing industry, 'which has a vested interest in encouraging internal IT to eliminate everything that makes it more attractive than outside service providers.'"

Comments

Re:Business School Ideology

[catchblue22]

I am not saying that the skills learned in business school are useless. Only that claims that management is a completely transferrable skill independent of the specifics of the operations of any type of business are overblown.

I should also specify something more about the particular food plant that I am familiar with. The previous manager had worked his way up from the shop floor. He new the ins and outs of food manufacturing. He was familiar with how much maintenance was necessary on the machines, how much cleaning was necessary, how hard he could push the machinery and the workers. He was fair minded but firm. And when he ran the plant, operations ran smoothly and the company made lots of money. The plant gained a reputation for reliability and quality. But he didn't have an MBA, and so he was pushed out by upper management types with MBA's.

Fast forward to the new guy, an MBA manager who previously ran a train plant. He would sit up in his office staring at graphs. His method of management was basically to control money flows. He would cut money from sanitation, from quality control, from food safety testing. He would push the system to its limits, and several times the system broke, hurting the reputation of the company. To top it off, the company lost more money under his watch.

The business schools, to a certain extent, teach managers to cut themselves off from the details of operations, to abstract the operations of a company to a certain number of parameters. I am arguing that this is not a good methodology, and will not usually lead to an agile and innovative company.