MutliSourcing…The Right IT Governance for Maximizing Business Outcomes
Authored by Jeff Smith, VP Business Development @ GuideIT
A national healthcare provider was ready to move from multiple PBX systems to a VOIP-centric model for their communications…the transition, one piece of a broader multi-source IT strategy. Simple enough, right? Not exactly. This transition was a monster…500 locations and more than 1100 buildings. Additionally, the provider cares for patients, the majority of whom are in some form of acute need. Sure, any business requires clean execution in a project of this magnitude. But few businesses have the sole mission of caring for the acute health needs of their customers like healthcare providers do for their patients.
Truly lots of moving parts in this story…a story representing one part of the bigger picture. A critical attribute of this provider’s success was ensuring the right IT Governance function encompassing their multi-source strategy.
So what is the right governance? According to Gartner, governance is the decision framework and process by which enterprises make investment decisions and drive business value. Take that one step further applying IT and the definition is, “IT Governance (ITG) is the processes that ensure the effective and efficient use of IT in enabling an organization to achieve its goals. IT demand governance (ITDG—what IT should work on) is the process by which organizations ensure the effective evaluation, selection, prioritization, and funding of competing IT investments; oversee their implementation; and extract business benefits.”
Now consider “why” the right IT Governance is critical in a multi-sourcing environment. When multiple vendor partners serve in support of the broader business mission, the opportunity to optimize outcomes for the business is huge. And so is the risk. The opportunity is there because the organization can leverage the specialization of subject matter experts necessary in a highly complex IT environment driven by growing business demands. One partner specializes in apps, another in cloud infrastructure, another in mobility, and so on. They all bring optimal value in areas critical to support the business…thus the core value of multi-sourcing.
Therein lies the risk too. Without the right governance model, no clear accountability exists to ensure open collaboration and visibility across specialists. Specialists will act in silos. And we all know how silos hurt business. Simply put, the “why” for the right governance is to optimize outcomes through maximizing specialization while minimizing the risk of “silo-creep”. The right governance closes the gap between what IT departments think the business requires and what the business thinks the IT department is able to deliver. Organizations need to have a better understanding of the value delivered by IT and the multiple vendor partners leveraged…some of whom are ushered in through business stakeholders.
Because organizations are relying more and more on new technology, executive leadership must be more aware of critical IT risks and how they are being managed. Take for example our communications transition story from earlier…if there is a lack of clarity and transparency when making such a significant IT decision, the transition project may stall or fail, thereby putting the business at risk and, in this case, patients lives at risk. That has a crippling impact on the broader business and future considerations for the right new technologies to be leveraged.
Conclusion: the right IT Governance is critical to optimizing business outcomes