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INSIGHT: The new model for enterprise IT services

INSIGHT: The new model for enterprise IT services

Welcome to the tipping point where it’s clearly time for a new model. Enterprise IT must re-align to the new requirements...

Enterprise IT has long held its place as a function that owned technology, and if a business unit needed anything done requiring that technology, it would submit a request and wait. But that was then.

More and more, governments and businesses are letting go of the slow-moving, cumbersome view, and, instead, beginning to look at enterprise IT in the same way they think about consumer technology.

As consumers, we expect technology to deliver what we want, when we want it, and in a quick, convenient manner. Why not the same from enterprise IT services?

To this new perspective, add a new class of IT buyers from across the organisation. Their focus is not on technology, but rather business value and solutions for daily pain points. IT strategies and buyers have evolved. So must enterprise IT services.

Welcome to the tipping point where it’s clearly time for a new model. Enterprise IT must re-align to the new requirements—facilitate technology-enabled business innovation quickly and at a low cost. It’s not an option. It’s a requirement in the New Style of IT.

Consumption-based technology

One strategy is borrowed from the consumer marketplace. When you sign up for a mobile phone contract, you pay for what you use. You can switch providers in minutes. You have choice without long-term commitment.

Enterprises are increasingly demanding this same experience. As an example, consider fraud prevention services. Rather than paying up front for a fraud prevention solution, the business user would pay a fee every time the IT provider checked a transaction for fraud.

The more the business consumed, the more IT would be rewarded in payment. If the enterprise is unhappy with the service, it can switch providers.

Easy, simple, and agile. Consumption-based business services make enterprise IT far more competitive because the enterprise always has a choice to go elsewhere.

Business value-based solutions

Another strategy for a new model of enterprise IT services is business value-based solutions. This means the enterprise is charged based on the value it realises.

For example, if an IT solution for fraud prevention saves the business $1 million, then IT is compensated a percentage of the savings. The business isn’t charged for the service—just for the value it realises.

Service providers will compete, and the competition will lead to bigger, better solutions for the enterprise. Real-time brokering will also be possible, so a business might choose to leverage the service strengths of multiple providers for the best results.

With both consumption-based and value-based services, enterprise IT will have to stay at the top of its game. And be the agile, trusted partner the business needs, rather than a slow-moving necessity.

By Alan Flower, Regional Chief Technologist in EMEA, HP Enterprise Services

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