Over 700 IT leaders respond to Logicalis’ fourth annual Global CIO Survey

As Logicalis’ top executives assess the results of the company’s fourth annual Global CIO Survey, it’s clear that digital disruption is changing the way businesses procure, manage and consume technology – and that significant changes are on the horizon for CIOs and their teams.

One of the most significant changes the study revealed was a shift in thinking about shadow IT, a practice once thought of as a symptom of the fast-paced nature of digital transformation, but something which has now become so commonplace that it has spawned an entirely new phenomenon: the shadow IT department.

Doing It My Way

Frank Sinatra’s 1969 hit song “My Way” spent 75 weeks topping billboard charts around the world as an anthem for individuality and self-determination. Quite simply, its message struck a chord. By nature, people want to do things their own way – something that is particularly true in the corporate environment in today’s digital age.

Individual business units have long been circumventing CIOs, enacting their own IT solutions so often that “shadow IT” has now become accepted as the norm. Perhaps surprisingly, the pervasive nature of shadow IT has led to the development of a new phenomenon, according to the Logicalis 2016 CIO survey.  Yesterday’s covert shadow IT practices have come into the light, spawning clusters of mini technology domains, according to the more than 700 CIOs queried in the survey.  More than three-fourths (83 percent) of the survey’s respondents state that line-of-business (LoB) departments now employ their own IT staffs, while almost two-thirds (64 percent) of CIOs work with these LoB technology specialists on a daily or weekly basis.

Going Rogue?

Easily accessible applications and free cloud services are making it tantalizingly easy for employees to use alternative services in an ad hoc fashion, creating pockets of disruption across their organizations.  It’s very easy to put the old fashioned, centralized IT glasses on and see this disruption as subversive and undesirable.  But is it?

The truth is that centrally managed IT is simply not nimble enough to support the pace of innovation that LoB departments must deliver in this fast-moving digital age.  These days, LoB technology procurement is not so much shadow IT as it is “shadow innovation,” and guided by overarching business strategies, this kind of shadow innovation is vital to enabling businesses to realize the huge benefits that flow from digital transformation.

While shadow IT might have under-the-radar origins, it can enable businesses to be nimble enough to innovate on the fly and respond to customer demands as they arise.  The fact that so many CIOs are working with “shadow IT departments” suggests that these benefits are well understood and, as a result, LoB IT is now embraced rather than merely tolerated.

Risky Business

However, there is a caveat: While LoB IT is largely viewed as a key element of digital transformation, it is not without its risks.  While IT in general cannot remain centralized in a digital business, it must still comply with wider imperatives such as control, compliance, compatibility, and, of course, security.

For instance, it’s clearly not desirable for individual departments to enter agreements with cloud providers without rigorously auditing their credentials and their solutions’ ability to work with wider application arrays and security architectures.  Indeed, these are precisely the kinds of incidents that once caused shadow IT to be routinely accused of poor data handling practices that left organizations exposed to unauthorized access to data and data breaches.

Then there is the issue of overlap. Without central oversight, departmental knee-jerk responses to customer needs can miss the bigger picture; individual shadow IT departments may fail to ask vital questions like, “How does this approach benefit the business as a whole?” and “Do we already have a solution to this problem?”

The answer, of course, is not to throw the baby out with the bathwater by simply banning LoB IT purchasing.  It is to provide central oversight and a high-level consulting resource that LoB can turn to for strategic advice, not just technology.  Indeed, given the extent to which CIOs now work with LoB IT specialists, it seems they are already embracing exactly this kind of role.

Casting a Light in the Shadows

Make no mistake, however, this is a delicate balancing act.  The Roman poet Ovid is quoted as saying: “A new idea is delicate. It can be killed by a sneer or a yawn; it can be stabbed to death by a quip and worried to death by a frown on the right man’s brow.”

Today’s CIOs must tread a fine line between maintaining standards, transparency and oversight and encouraging and enabling creativity, innovation and transformation. Their challenge over the short- to medium-term will be to find ways to support LoB specialists, secure the network and keep vital data safe – all without stifling innovation.

 

Want to learn more? Compare this year’s results to the third annual 2015 Logicalis CIO survey, “The Shadow IT Phenomenon” here: http://ow.ly/tJgm3057hwP. And, if you’re looking for trends, explore Logicalis’ 2014 CIO report, “Establishing the Internal Service Provider,” as well as the 2013 report, “Embracing a New IT Reality.” You can also read related blog posts here and here. Learn more about the service-defined digital transformation organizations worldwide are undergoing in this WatchIT video featuring Logicalis US CEO Vince DeLuca: http://ow.ly/IJ0Y3057pQC. And finally, read a Logicalis white paper: “Why Every CEO Wants to Lead a Service-Defined Enterprise and Why the CIO Needs to Make It Happen”: http://ow.ly/rp6e3057hMN.