Evolution of the IT Department in the Age of the Cloud
There’s no question that the cloud presents a disruptive technology that inevitably leads to rethinking – and often restructuring – the objectives of internal IT departments.
An internal IT department – once considered critical to the success of the business enterprise – has, in many cases, become obsolete. With cloud-delivered applications eliminating the need for hosting multiple versions of software on servers, testing for compatibility and applying security patches, the need for internal IT staff managing an infrastructure has been diminished. The result is that cloud-based companies function more efficiently, have more secure data and operate more profitably.
Raj Sabhlok recently posted an article titled 7 Reasons Why IT Won’t Disappear Anytime Soon. I prefer to think that internal IT departments are in a transitional phase which will result in more strategic, meaningful work than managing an IT infrastructure. Internal staff can be repositioned to create more value for the company. In fact, we find that internal staff that act as a liaison between our cloud ERP solution and their companies frequently move into higher levels of responsibility due to their comprehensive understanding of workflow, processes and technology.
Inteva Products, a global Tier One supplier of automotive parts, provides an excellent example of the benefits that derive from a company transitioning from an on-premise, legacy ERP platform to a cloud-based alternative. After deploying The Plex Manufacturing Cloud, Inteva Products was not only able to have real-time visibility into its MES functions which improved inventory control, it also developed more efficient, streamlined work flows which improved many processes, including production control & logistics (PC&L), tool tracking and enhanced financial reporting. Now management can view consolidated financials at any time and make accurate, real-time allocations across the company.
Improved operational operations wasn’t the only benefit Inteva Products enjoyed thanks to the cloud – it also reduced its monthly expenditures on IT by a third while transitioning its IT staff from the IT technologist role to business analysts, a much more strategic, challenging and rewarding position.
“Plex has brought us more flexibility in staffing and allowed us to avoid the sort of two-tier IT group required by SAP – where most of the team was dedicated to managing the infrastructure, and only a small percentage were involved in business development,” said Inteva Products CIO Dennis Hodges. “In contrast, about 80 percent of our IT team members today are business analysts. They are able to focus on strategic support of our business units. This has improved the overall alignment between the IT department and the rest of the business.”
Particularly with companies embracing the bring your own device (BYOD) trend for its obvious cost benefits and convenience, outsourcing what used to be an internal function and repositioning staff to positively impact business development is proven to be a smarter way to conduct business.
Much like the world has changed into a global economy with competitors not limited by geography, businesses must adapt or gradually lose market share to their more modern and nimble competitors.
The cloud offers companies the opportunity to focus on their mission critical goal of producing a better product at a lower cost and not be concerned with mundane and unnecessary concerns like software version compatibility, server maintenance and security patches.
IT functions can safely and securely be outsourced to outside vendors focused on delivering technology solutions in a cost effective fashion. Existing technology staff can provide more value by transitioning to the business analyst role and provide the intelligence that helps inform decision making at the enterprise.
I maintain that technology has never been more important for a business, and in many ways we can consider this era the golden age for IT.
By Jason Prater, Plex Systems
Jason Prater is the vice president of development and leads the product and platform development teams. Jason leads Plex Systems’ cloud development process, design through deployment, providing the vision and day-to-day leadership of product and platform development teams. From previous experience in manufacturing, Prater brings a focus on building meaningful enhancements to the Plex Manufacturing Cloud that support manufacturers’ evolving needs and boost operational performance.
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