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Longer-Term Implications In the next four to five years and beyond, the costs of IT talent will increasingly crowd out vital investments in many companies. IT organizations that are mired in operational activities and infrastructure maintenance will have fewer and fewer resources to invest in initiatives that strategically differentiate their companies. In many cases, wholesale IT infrastructure outsourcing " much of it pushed overseas " will become an inevitable scenario. Given that the promise of "transformational outsourcing," whereby outsourcers provide continuously growing levels of business value over time, is yet to truly play out, this may be the end of many IT operations as anything but a support organization. Some companies will more actively weave IT into the fabric of their enterprises. Through service-oriented architectures (SOA), open source advancements and effective data management, they will make (or continue to make) IT a strategic enabler. But while companies such as Wal-Mart, FedEx and others will continue to view IT as a competitive weapon, many other companies can be expected to lose ground as IT becomes permanently positioned as a commodity resource and cost center. Previous IT investment decisions will have compounding effects for many years after. CIOs that invested heavily in strategic, differentiating activities will be reaping the rewards of their investments, while senior IT executives that remained focused on the maintenance of outmoded infrastructures will find themselves increasingly vulnerable to escalating costs. It will be clearer in retrospect that some of the key decisions influencing these outcomes will have been hiring decisions, particularly in data-related areas. As competition becomes more focused on operationalizing analytics and information on the front-lines of the business, the ability of IT to successfully scale, maintain and monitor its data management infrastructure will be a given. IT organizations that leverage this data by investing heavily in analytical, project and application-focused roles " as opposed to administrative roles " will be better positioned to compete effectively in the marketplace.
Business Strategy Issues These projections raise a host of business issues which concern executives at all levels of an enterprise. Recognizing the fact that there will always be tactical fires to fight, CIOs and other IT leaders are now confronting the strategic challenges that talent trends represent. The decisions they make in the short-term will largely influence the direction of their organizations over the longer term. Will IT be perceived in the eyes of executive leaders as a tactical, support organization, forever committing resources to activities to that are below the line? Or will it recognize the coming collision in time and take the steps necessary to remain or become a strategic partner to the business, investing in innovative, core, above the line activities that are perceived as competitively differentiating? Geoffrey Moore, author of the new book Dealing with Darwin, argues that one of the greatest mistakes that organizations make is confusing "mission critical" activities with their "core" capabilities. As he explains, "Core is the ability to differentiate for competitive advantage; mission critical is the property of having very high risk, very high consequences when things fail." The phenomenon that Moore and others have observed is that IT organizations tend to sink escalating amounts of their precious capital in mission critical activities. Their hiring budgets are increasingly weighted to these types of efforts. After all, CIOs can't afford to fail in mission critical areas. The trouble is that budgetary decisions of this sort come at the expense of more strategic actions; they inevitably diminish the IT executive's status and credibility as an enabler of proactive, innovative, competitive differentiation. What seems apparent is that intensifying waves of competition and commoditization are forcing senior IT leaders to make complex investment decisions of ever greater consequence. The coming talent implosion only heightens the risk of remaining reactive. John Bostick is president and CEO of dbaDIRECT which provides data infrastructure management services to Fortune 1000 and Private 500 firm. Other recent articles from TechCareers Career Profile: SSH Founder Tatu Ylonen Today's Job Search Requires A Proactive Approach For more expert career advice and articles on career issues and topics, visit TechCareers.
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