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The (Not So) Hidden Cost Of Siloed IT

An extended version of this blog post originally published on Forbes.com – read the original article here.

Siloed ITAs CTO of Virtual Instruments, I am responsible for bringing Virtual Instruments’ technology vision to the market, as well as being the voice of our customers in driving our product strategy. Some of the most common complaints I hear from customers are directly related to the challenges created and perpetuated by siloed IT, or the organizational separation of teams working in relation to storage, network, compute, database and application components of the company. According to a recent research study by Dimensional Research, less than half of enterprises take a collaborative approach to something as integral as establishing performance requirements for new infrastructure.

Siloed IT originated from the need for deep technical expertise in specific domains. This perceived need has been perpetuated by vendors, years upon years of technology adoption (because let’s face it, we’re very good at adopting new technologies and very bad at retiring old ones), and legacy experts desperately trying to differentiate themselves to ensure job security. This, in turn, is exacerbated by the fact that each vendor and generation of technology innovation comes with its own specific tooling. However, this tooling is not generally interoperable, nor does it share a common context, and as a result, it perpetuates the siloed approach.

So, how would we shift the way an IT organization operates? Let’s examine how a few specific companies approached their silos and if they were successful in creating a culture of collaboration to better serve their business and customers.

The Perils of a Fixed Mindset

Let’s start with a company that, despite being on the cutting edge of technology and having a strong desire to innovate, still operates with a fixed mindset that is holding them back and costing them both time and money. This large financial services company has several business units across several geographic markets, and while they have some specialized IT systems to support specific businesses or geographies, they also have a very large shared services IT organization striving to provide centralized IT as a service across the company. Unfortunately, they still operate almost entirely in silos.

As a result, while all these teams are inherently interdependent, they are not at all integrated. When one team makes a decision, they do so without full consideration of the potential ripple effect across the organization. One such decision ultimately resulted in an outage that not only cost the company both time and money, but also directly impacted customers.

Growth Mindset at Work

Now let’s examine another organization that has adopted a growth mindset and integrated their teams to drive collaboration. This is a company in the business of delivering energy — clearly a market where performance and availability are of the utmost importance. As a result, instead of looking at their IT organization as a collection of separate and distinct functions, they decided to organize around a central driver: reliability.

When this organization considers making changes, they do so collectively and are able to avoid the negative results of both direct and indirect impacts. There is an end-to-end understanding of how each piece impacts the other. The outcome? This company runs almost three times more efficiently, delivers projects four to five times faster and maximizes their infrastructure investments over a five-year life cycle, all of which means a healthier bottom line and, frankly, a much more satisfying customer and employee experience.

According to a recent Forrester report, future organizations will value collaboration among employees. This will change the role of C-level executives from leading functions to orchestrating a dynamic business. Ultimately, CIOs will be deemed the “ringleader” for ensuring their organizations remain dynamic and will be held responsible for making sure that unproductive organizational silos are left in the past.

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