strategy+business is published by PwC Strategy& LLC.
or, sign in with:
strategy and business
 / Autumn 2009 / Issue 56(originally published by Booz & Company)


The Consumerization of Corporate IT

Other benefits of IT consumerization may become more obvious over time. Productivity could rise as workers become less tied to the office. It is easier for employees to work at home or to spend more time on the road trying to get new business, knowing that, because of consumerization, they can seek hardware and software help at any electronics store without breaking company rules. Moreover, consumerization offers a path to reducing a company’s carbon footprint by encouraging telecommuting and Internet-based applications run by mega-scale server farms, which are in many cases powered by greener energy sources and are more energy efficient than hardware in corporate data centers.

Clearly, IT consumerization is not for all firms, and even when it’s a good fit for an organization, it is not for all employees. For example, highly regulated companies, such as financial-services firms that are legally bound to diligently maintain records of e-mail and instant messages, may be understandably hesitant to freely adopt Gmail, recognizing that this service will make it more difficult to log and store internal and external communications. Over time, however, that should become less of a concern as third-party e-mail services prove more than willing to add capabilities that match corporate needs.

In almost every company, the willingness and ability of employees to embrace new technological ideas can be broken down into a 20–60–20 formula. Twenty percent are eager to jump in immediately; 60 percent are on the fence at first, but are ready to take the plunge as soon as they see signs of its value; and the final 20 percent are Luddites. Segmenting the workforce to find those who can and will be early movers can help create a smooth path to achieving critical mass. In some cases, technology choices help. Apple computer home users are among the best zealots for IT consumerization; offer them an opportunity to connect their Macs to the company’s network and you will have friends for life. In other cases, the first 20 percent may be workers who don’t need the full suite of corporate applications.

Implementing IT consumerization is not a major technical challenge, but it does require organizational changes. One such change is the need to address, through staff education, both potential security lapses and the penalties for failing to adhere to the company’s standards. A well-trained employee should be able to spot phishing or another type of cyber attack immediately and take the proper steps to report and eliminate it. Similarly, workers should be able to police themselves not to visit pornography or hate sites — and understand that they will be disciplined if they do not comply. Empowering workers, a concept at the heart of consumerization, leads to more secure and efficient operations.

Lined up squarely against consumerization are many IT departments and their existing outsourcing partners. Under increasing cost pressure, IT departments try to do more with less and default to managing only incremental change; in addition, they see consumerization as a threat to their core responsibilities and, perhaps, their jobs. For outsourcing partners, the perceived harm is even more threatening. For years, outsourcers have been able to use a “your mess for less” approach — that is, their clients retain the same untidy technology system they already have but it doesn’t cost them as much to maintain it. Including outsourcing, more than 50 percent of the total expense of delivering technology to end-users in most companies is earmarked for labor. Consumerization is at odds with the notion of paying such high or fixed costs and, therefore, is perilous to outsourcers’ revenues.

But defenders of the status quo may not hold the upper hand much longer. Indeed, the timing couldn’t be better for consumerization. The global recession is forcing companies to cut costs in ways they didn’t anticipate before the downturn, and IT is a major cost driver for most organizations. CIOs have struggled to manage demand for new internal hardware and applications — particularly because the requests are often driven by individual preferences. That frequently translates into development of “spot” or customized solutions, adding complexity each time the IT department needs to implement new functions in yet another business unit. And that, in turn, greatly increases the fixed costs for IT departments, diluting gains from scale as businesses grow.

Follow Us 
Facebook Twitter LinkedIn Google Plus YouTube RSS strategy+business Digital and Mobile products App Store


Sign up to receive s+b newsletters and get a FREE Strategy eBook

You will initially receive up to two newsletters/week. You can unsubscribe from any newsletter by using the link found in each newsletter.