Working closely with the business users of technology has been an IT mantra for ages, but the new Web rules supercharge the concept. Of all the issues raised by the anticipated service waveincluding problems with integration and scalenone are more pressing than the changes in culture necessitated by the new regime.
"There is a cultural shift, absolutely," says Bridget Reiss, vice president of IT at Millipore Corp., an $883 million biotech-products company based in Billerica, Mass., and a customer of Salesforce.com. "Our IT organization has changed a lot as our job has moved toward partnership and being more of a solutions providerit's less about bits and bytes. Our skill sets are changing. IT people tend to want everything perfect before they move on it. Now it's a different mindsetyou need to deploy in quarters, not years."
This need for speed is part of the service mindset. "Speed is the differentiator," says Eric Berridge, a cofounder of the New York City-based consulting firm Bluewolf, which deals extensively with software as a service. (Bluewolf also works with what Berridge calls "premise-based" applications, i.e., traditional installed software.) "You can bring applications live in a very short period of time, launch hundreds of users in a matter of weeks, so you have to have conversations in a short period of time, instead of taking a year to gather requirements. It's three or four conversations with the business, and you're expected to deliver applications that meet 80 percent of requirements."
Meeting this demand requires a new way of managing tech projects. "The biggest thing that CIOs need to be ready to retool for is the iterative process," says Berridge. "The change-management exercise, the thing you have to internalize, is that the new functionality keeps coming into use after you go live, and it's no longer wrapped around the IT group in terms of testing and release. You can release functionality in bite-size chunks over time, never having that big two-year wait to upgrade and go live. We see a lot of customers coming back to us and saying, 'This doesn't work,' and we say, 'Now it does. You haven't stayed current.' "
A danger in this situation is that IT can lose its relationship with the business. "One problem we've heard from our clients is that the pay-as-you-go model lets business users deploy without IT involvement," says Liz Herbert, an analyst with Forrester Research. "The challenge is that business users might not think about integration, might not understand service-level agreements or vendor contractsbut with point-and-click wizards, they can get into all that stuff themselves. The CIO needs to stay involved, or else three months down the road when a user runs into a problem and calls IT for help, it might be the first IT has ever heard of it."
Businesses can get used to this new relationship in a hurry, says George Hu, senior vice president of applications at Salesforce.com. "You give them a taste of things happening quickly, and soon they start asking for it." Adds Berridge: "Because business is now so heavily involved, they have the expectation that you should be able to do anything they want." His advice: "Don't fight it. We've seen organizations try to contain it, but it breaks through."
At Millipore, Reiss changed the way her organization delivered training and support to salespeople in order to keep up with the rapid adoption and learning curve with software services. Starting last March, the company began rolling out Salesforce.com, which now has 850 users. "We assembled a team of IT people, our 'Care Bear' team, and put them through a boot camp. Then we assigned them individual users around the world and made them responsible for training and support." That strategy allowed Reiss to stay ahead of the business users.
The rapid deployment fits in with the strategic goal set by new CEO Martin Madaus of doubling the value of the company in four years. Yet had Reiss not kept up with her users, the results could have been much less satisfactory. Users might have lacked a sense of ownership, and so ended up with less functionality from the service than it could actually deliver. IT could have lost credibility, and felt less invested in the project and its future support. "If the users had tried to do this on their own, it most likely would not be in global use," Reiss says. "It certainly would not be common between divisions, and it could have cost more money."
She adds, "IT definitely needs to think differently, because the users want more with services. But if the users think they can do it without IT, they're crazy."