The Hub Commentary_
This headline caught my eye as I will be the first to debate that IT is not a profit center. However, this is a prime example of IT realizing and classifying services based upon Service Value and applying Business Service Management practices. In an effort to first cut support costs from old systems, right sourcing decisions and partnerships were established for industry must haves and I applaud these decisions.
I’ve seen this consortium model a couple of times in my career and it can be successful when set-up like this with the outsourcer as the intermediary managing the infrastructure and service with the ability to market, sell and replicate the solution across the industry. The service is an industry standard and not specific to the business and thus no competitive advantage across the industry. However, what usually keeps it from being successful is the size of the market that it can be sold to and how easily the others in the industry can just plug into the service.
The tipping point to concentrate on growth investments for IT and decrease the IT spend for cost saving measures may be enough to push to consortium like success for these types of services in the coming 12-24 months.
Give a man a fish, the proverb goes, you feed him for a day; teach a man to fish, you feed him for a lifetime. Turns out there’s a quasi-corollary for corporate IT: Give your company a more efficient system, and you cut costs; give your industry a better way to operate, and you increase revenue. (Read Full Article…)