What has Schrödinger’s Cat to do with Enterprise IT? The famous Schrödinger’s Cat paradox explores the concept of multiple and concurrent versions of reality – all of which may be correct at the same time. Applying this analogy to organisations, there are often multiple simultaneous versions of reality held by key stakeholders on how, what, when and where enterprise IT solutions should be applied - all seemingly valid. The combined influences of business having direct access to an increasingly compelling range of business ready technologies and meeting short term commercial imperatives are fertile grounds for line of business executives and functional managers to feel empowered to take control of elements of enterprise IT. CIOs faced with the constant challenge of effectively managing these multiple versions of reality recognise that this is no trivial exercise. The seismic shift from the “build it and they will come” to the “here it is, IT Department, it’s implemented, now support it” represents both opportunities and challenges for CIOs. Fueling this shift is the increasing expectation of IT by their organization that CIOs must rapidly transform their IT Departments from IT service providers, to IT Service brokers. In this presentation Rob Livingstone explores a range of key concepts and approaches to mitigating the unintended consequences of the Schrödinger’s Cat paradox for CIOs grappling with this challenge. Key concepts: • Exploring key elements of the IT services brokerage model • Understand why the ‘IT-business alignment’ mantra is likely to be suboptimal and explore a new approach. • Explore how the conventional methodologies associated with IT strategy development should be reshaped. • Explore some approaches to identifying and managing enterprise systemic risk associated with the transition.

1. Transitioning the IT Department
into a Business Relevant Service
Broker
Keynote Address
CIO Summit, Grand Hyatt Melbourne,
Australia
27th Feb 2013
© All rights reserved. Rob Livingstone Advisory Pty Ltd. Unauthorized redistribution prohibited
without prior approval. ‘Navigating through the Cloud’ and ‘Success is our story, let’s make it
yours’ are Trademarks of Rob Livingstone Advisory Pty Ltd.

2. Agenda
1. Context
2. Disruption: CIOs weathering the sea of perfect storms
3. Schrödinger’s Cat: Alive and well in Enterprise IT?
4. Enterprise IT: Concurrent multiple versions of reality
5. The Mythology of ‘IT-Business alignment’
6. Enterprise IT: From broken to broker
7. Move spotlight from technical risk to systemic risk

3. 1. Context
“If you can't explain it simply, you don't understand it well
enough.” - Albert Einstein
CIOs can play a dual role:
•Lead the transformation of the
organisation through appropriate
technologies and innovative processes
•Educating key stakeholders about
optimal adoption of emerging
technologies with known value and risk in
terms that users understand.

4. 2. Disruption: CIOs weathering the sea of perfect
Session 6 storms
Flickr.com

5. 2. Disruption: CIOs weathering the sea of perfect
storms
The senior ranks of IT are finding themselves in the ‘perfect storm’
arising from the combination of forces:
•The first, and most influential of these forces in my view, is the
increase uncertainty and volatility facing Australian organisations,
whether public, private or government. This tends to drives
executive decision making which is increasingly focussed on the
short term.
•The second influence is the fundamental shift in the expectations of
enterprise IT by other executives and the business as a whole. This
is a direct consequence of having first hand exposure to user
friendly, low cost (or free) consumer grade IT technologies and
solutions, and pervasive marketing from IT vendors.

6. 2. Disruption: CIOs weathering the sea of perfect
storms
The senior ranks of IT are finding themselves in the ‘perfect storm’
arising from the combination of forces:
•The third is internal inconsistency of business strategies across
business units. This presents a challenge for those in IT leadership
roles, who are expected to respond to inconsistent short term
demands, some of which are fragmented, not always well thought
through, potentially contradictory and not always in the long term best
interests of the organisation.
•The fourth is the expectation that IT leadership should not appear as
technologists. The ‘new IT leader’ should be able to communicate
clearly in ‘business speak’ and turn technical, governance and risk
complexity into plain language.

7. 2. Disruption: CIOs weathering the sea of perfect
storms
December 2012
http://info.publicintelligence.net/GlobalTrends2030.pdf

8. 2. Disruption: CIOs weathering the sea of perfect
storms
We are not alone!
Legal Process Outsourcing organisations bypassing lawfirms
• Consumerisation of Law?
“As more and more companies bypass
law firms and go straight to LPO
providers, Australian firms are now
realising the influence LPO providers
have in the market and are turning to
them to co-pitch for new clients.”
http://www.lawyersweekly.com.au/news/power-shifts-to-lpo-providers

9. 2. Disruption: CIOs weathering the sea of perfect
storms
We are not alone!
Session 6
http://www.news.com.au/technology/indian-websites-do-your-homework-for-2/story-
e6frfro0-1225953223266

10. 3. Schrödinger’s Cat: Alive and well in Enterprise IT?
Why IT is like Quantum mechanics?
From end user’s perspective, the complexity of IT is
mostly acknowledged, little understood, and seems
to provide the platform on which modern life
appears to depend!
Schrodinger's cat is a well known illustration of the principle
in quantum theory of superposition, proposed by Erwin
Schrodinger in 1935.

11. 3. Schrödinger’s Cat: Alive and well in Enterprise IT?
?
www.zazzle.com

12. 3. Schrödinger’s Cat: Alive and well in Enterprise IT?
Schrödinger’s cat
and enterprise IT?
Schrödinger’s Cat is alive and kicking in the Enterprise…..
•Concept of multiple and concurrent versions of reality in
respect of IT, all of which may be correct at the same time.
•Simultaneous versions of reality held by key stakeholders
on how, what, when and where enterprise IT solutions
should be applied - all seemingly valid.

13. 3. Enterprise IT: Concurrent multiple versions of
reality
http://www.theperceptionconundrum.com/
Everyone is a consumer of technology in one form or
another and therefore is entitled to an opinion…….

14. 3. Enterprise IT: Concurrent multiple versions of
reality
Why enterprise IT is like Broccoli?
From end user’s perspective, it’s bland, not
sexy, has the occasional bug in it, but it’s
recognised as being important for the health
of the organisation. Most importantly it’s how
it’s presented that’s the kicker.
• As a CIO you may know what technology best suits the
organisation, but is that version of reality commonly held?
• Consumerisation of IT, mobility, BYOD, Cloud and other
influences of emerging and disruptive technologies are rapidly
reshaping the perception of enterprise IT by their users
• This perception becomes their reality, which in turn influences
decision making

15. 3. Enterprise IT: Concurrent multiple versions of
reality
Importance of actively managing stakeholder perceptions
• IT’s influence on the enterprise’s view of the use of technology
being diluted
• Achieving all IT departmental KPIs and service levels alone is no
longer a measure success.
• Remove any defensive barriers
Question:
What specific strategies
are you adopting in
managing stakeholder’s
perceptions?

16. 4. The mythology of ‘IT-Business alignment’
Is IT-Business ‘Alignment’ desirable?
• Alignment implies no real interaction and never meeting, merely
travelling in the same direction?
• What does alignment say about players travelling at the same
pace?
Session 3

17. 4. The mythology of ‘IT-Business alignment’
Technology environment – High rate of change
New,
relevant,
cost
effective IT
systems and
solutions are
appearing
monthly!
Business environment – Organic rate of change
It’s going to
take us ages
Session 3
to plan your
new structure
and processes

18. 4. The mythology of ‘IT-Business alignment’
Some considerations:
• How well do your business strategies represent the real world?
Shelfware?
• What’s the degree of maturity of your business strategy?
• Non IT Executives should not expect IT to be submissive in accepting
business strategies, and merely ‘meeting the demands of the
business’.
o Recognition that an effective, trusted and engaged IT function has
the potential to drastically transform the organisation.
• Structural alignment of IT to the organisation should be consciously
thought through. This is much more than the ‘who the CIO reports to’
o How, when and where should aspects of the IT function be
centralised, federated, and for what business objective, and over
Session 3
what periods of time?
o What forms of hybrid structures are effective?
o The role of vendors should be clearly articulated

19. 5. The mythology of ‘IT-Business alignment’
Some considerations:
1. Traditional alignment methodologies are often time consuming,
somewhat bureaucratic and fail to capture the critical subtleties of
the real world.
2. Accountability for those influencing the decision making process
(… it’s called ‘politics’!)
3. Alignment is nirvana if the business strategy is inconsistent, lacks
coherence and fragmented across business units.
4. Alignment is not the end goal – effective, close coupled
coordination supported by a clearly articulated and acknowledged
shared accountabilities between IT and influential organisational
stakeholders
5. Business unit management incentive schemes can be
Session 3
counterproductive. What financial incentives to business
executives have for the (long term!) success of enterprise IT
projects?

20. 6. Enterprise IT: From broken to broker?
In July 2012 Gartner predicted that “by 2014, 30% of midsize-to-
large enterprise IT departments will become brokers for cloud
services consumed by their companies”
The reality is that effective IT departments
have always been brokering a range of
services for and on behalf of the business,
irrespective whether cloud or not….
……..however the landscape is changing
somewhat.

21. 6. Enterprise IT: From broken to broker?
Takeaway: Flip from service provider to service broker:
• Hone vendor management and governance skills
• SaaS: Strategy as a Service: Proactively deliver business relevant
strategies to meet defined or expected changes with agility. Take
the challenge to the business! Stress test any assumptions.
• Clearly define the accountability locus for enterprise IT across the
organisation.
- What’s in-scope for the management of IT services?
- What’s negotiable in the IT portfolio of services?
- What’s non-negotiable in the IT portfolio of services?
• Dominate the role as trusted advisor, not consultants or vendors!
• Proactively articulate the implications for disruptive and emerging
technologies for your organisation before you’re invited to
comment - Be seen and operate ahead of the curve

22. 6. Enterprise IT: From broken to broker?
Importance of Brand, Marketing and Communications for effective
brokerage
•The internal IT brokerage model should be seen as a true business
within a business.
•Technologists (engineers, scientists, etc) do not always recognise the
relevance and importance of acquiring ‘soft skills’ and related
capabilities to their projects, initiatives and even their own careers.
•If IT does not sensitively and deliberately control its brand through
effective marketing and communications initiatives, others will.
•Does the brand of the IT broker function align with the brand of the
organisation?

23. 7. Move spotlight from technical risk to systemic risk
Technical Risk:
“All systems are running
perfectly, Captain!”
Systemic Risk: “What
iceberg Captain?”

24. 7. Move spotlight from technical risk to systemic risk
• Historically, IT’s domain of risk management largely related to
technological and security risks and their organisational impacts. (Think
ISO27001 etc.)
• Inventorying and categorising risks does not necessarily expose
systemic risk
• IT should be a driving force in shaping the discussions relating to
systemic risk at the enterprise level.
Why:
• IT has a unique perspective of the organisation:
• Cross functional and detailed view on how the organisation works
(current state), and therefore identify potential opportunities that
individual faculties do not.
• Technology pervades all aspects of the organisation.
• Senior executives may have limited view on how, precisely, their
organisations operate.
• IT understands interconnectedness and information taxonomies.

25. 7. Move spotlight from technical risk to systemic risk
Lift the lid on systemic risk
• Play an active part in discussions on latent systemic risk
associated with inappropriate adoption of emerging
technologies
• Ensure key stakeholders understanding how current decisions
could influence future risk profile in a volatile environment
• Clarity over the positioning of all aspects of risk need careful
dissection amongst the noise and mixed messaging.

26. 7. Move spotlight from technical risk to systemic risk
Embedding IT transformational capability
Transform IT staff at every level
• Transforming internal IT capability to meet new demands
• Moving internal IT staff up the value chain
• CaaS: Introduce the concept of your ‘Career as a Service’
• Set expectation of volatility, managing commoditisation of skill
• Educate in the identification of systemic risk

27. ThankYou!
ROB LIVINGSTONE
- Fellow, University of Technology, Sydney
- Principal, Rob Livingstone Advisory Pty Ltd
W: www.rob-livingstone.com
E: rob@rob-livingstone.com
P: +61 2 8005 1972
M: +61 419 632 673
F: +61 2 9879 5004
Tw: @rladvisory
© All rights reserved. Rob Livingstone Advisory Pty Ltd. Unauthorized redistribution prohibited
without prior approval. ‘Navigating through the Cloud’ and ‘Success is our story, let’s make it
yours’ are Trademarks of Rob Livingstone Advisory Pty Ltd.