The digital transformation of our economy is creating many challenges for CIOs and IT organizations. The development of original software at scale is near the top of that list.
Over the last 15 years, the capacity for IT shops to develop original software that provides differentiated services has mostly atrophied. The industry has focused, instead, on implementing shrink-wrapped software packages. IT’s effectiveness was measured on deploying, optimizing, and maintaining those packaged systems.
However, in the past few years the value of IT has changed. Businesses across nearly every industry are becoming software developers. They not only expect their IT departments to manage operational systems, but also to create original software functionality that differentiates their products, delivery, and the related services they provide to end consumers.
All industry disruptors at this point have some original software setting them apart. For example, Tesla disrupted the automotive industry as an aggressive user of original software and IT technology. They introduced their autopilot feature by enabling software implemented in a simple experience for their existing customers.
Need more proof? Pivotal Labs, which helps customers build mobile and web software, is the EMC Federation’s most active and in-demand product/service offering. It pairs the customer’s subject matter experts with Pivotal’s experienced developers to build new software applications while also transferring knowledge of the development and deployment methodology.
The demand comes from most modern IT groups realizing their relevance requires building, or rebuilding, these skills and capacity.
A second part of rebuilding is embracing open source software. The use of open source has two values to modern enterprise IT.
First, a large body of innovation happens within open source projects. By adding open source to the software toolset, enterprises gain more options to build out differentiation. What analytic strategy would be complete without the ability to leverage tools such as Hadoop in addition to commercial database tools?
Second, because most open source efforts have vibrant communities, there is an opportunity to create original software and offer it to a community that will share the burden of moving it forward. Most companies that are open sourcing their technology are contributing functionality that they used months if not years ago to help them get to where they are today.
This is perfectly fair behavior. You create functionality, but eventually you realize it is not a substantial point of differentiation anymore, so you let the open source community advance it while focusing your own capacity on creating the next generation of differentiated functionality.
The demand to differentiate in this digital economy is a huge challenge for enterprise IT. Most don’t have enough high-value development capability in place. IT needs to reconstitute it, while staying within the existing budget. Current systems will need optimization, with costs driven down through automation to free up resources for developing original mobile, web, and big data software.
The good news is that IT has never been more important to the success of the business. The IT professionals and companies who leverage original software development creatively are going to win. Those who do not, risk disruption.
