Beware Shrinking IT Staffs and Contacts by 2010

Don’t look now, but your favorite customer contact may be looking for another job outside of the IT department. In the next five years the number of IT staff at most companies will shrink by a third, according to Gartner, a market research firm headquartered in Stamford, CT. The reduced staff will accompany a shift in resources away from dedicated IT departments and toward line-of-business groups that will take more responsibility for their computing needs.

Gartner predicts that by 2010, 6 out of 10 people affiliated with IT departments inside most corporations will assume business-facing roles dealing with the intersection of information, processes and relationships. As a result, Gartner predicts the size of the average IT department in midsize and large companies will be at least one-third smaller than it was 10 years previously.

As information technology becomes a more integral part of every business function, IT skills will become a more important component of business professionalism. The growing technical sophistication of line-of-business organizations will displace in-house IT staff, who will migrate to serve under line-of-business managers. The end result will see many former IT employees working for nontechnical managers, according to Gartner vice president David Flint.

IT departments will not disappear entirely, though. Instead Gartner believes they will become more specialized to increase their value to the larger enterprise. Gartner identifies three likely roles IT will play in the future.

1. Change agent. The smaller IT department will be aligned with the business to support strategic initiatives. IT personnel will have the skills and credibility to offer tangible value to the business by fusing technology, business process design and the business relationship.
2. Services broker. The IT department will be a small unit with personnel who have contract and negotiation skills and expertise in handling relationships with various outsourcing organizations. IT personnel also will play a significant role in sourcing and managing outsourced applications and business process services.
3. Utility provider. The IT department will provide technology-based services and operate them with competitive efficiency as a cost-effective alternative to outsourcing. The group will play a fundamental role in the acquisition and delivery of IT products needed to support the business. This essentially is the role IT groups play today, but with reduced responsibility.

The shift of resources from technology-oriented groups to business-oriented groups will have a tremendous affect on software sales, especially for software vendors who have targeted their sales efforts primarily to IT staffers. The standard sales process for such vendors is to educate the IT staff and help them sell an applications concept to the rest of the company. As the line-of-business organizations increasingly take the lead on software purchases, however, software sales reps will be forced to work more directly with the line-of-business managers who own the technical resources.