When you think about a 15-year IT strategic plan, Japan naturally comes to mind. Japanese companies plan for the long term and are unswayed by short-term performance surpluses or shortfalls. This is because they believe in a more lasting vision of where they expect to be in the marketplace and how they will be positioned for growth.
But in America, I can attest that CIOs rarely get to discuss 15-year plans, if ever. This isn't even a practical consideration for most American companies.
The reasons are easy to understand. Shareholders in US companies expect immediate results and examine them quarterly. Remembering my semiconductor days, in quarters when we were up, we were greeted with cheers, handshakes, and bonuses. In the down quarters, we risked increased scrutiny and even termination. It made those of us sitting in “mahogany row” wonder if it would even be possible to think about a “long term” beyond the next three years at most.
This makes it all the more remarkable that a major American manufacturer is working with 15-year strategic plans, including one for the IT department. The company (which asked not to be named) is five years into its 15-year plan, and the results are impressive.
In IT, the corporate datacenters are 85 percent virtualized, far above the 30-50 percent virtualization rates of many enterprises. Since this company's business operations are global, the datacenters are, too. They operate nonstop with an IT staff that “follows the sun” with 24/7 service and support. A carefully orchestrated staffing plan has subject matter experts on hand in every datacenter for every technology that IT employs (i.e., there is no waiting for answers or fixes until corporate “wakes up”).
The company applies a proven cost structure algorithm to all facets of its datacenters and IT infrastructure. This virtually guarantees excellent ROI (return on investment) and TCO (total cost of ownership) for every IT technology and strategy -- something most CIOs just dream about.
The company is not heavily engaged in the private cloud as yet, but it sees no compelling business case for being in that area. The important thing is that corporate IT has the agility to move in that direction from both the technology and IT staffing standpoints if it needs to.
Just how did the company get there -- especially in an industry sector (manufacturing) with a notoriously slow IT adoption rate?
“Twenty years ago, we made the decision that, as IT, we had to sell our solutions to business units,” said the company’s CIO. This created a mindset and a culture in IT that looked into the business value of any technology before proposing it.
“We focused on rapid application deployment, but what we meant by that is that there would be the kind of IT velocity of change that would facilitate a total transformation of the business,” the CIO said. “In other words, our focus was always on our end customer.”
That business focus meant IT did not necessarily follow every new technology fad, the CIO said:
Those of us who have been in the business for a while recognize that computing is just one big cycle. Early on, we centralized our operations. We never stopped doing that, even in the 1980s, when the move was to distributed computing. We believed in our long-term plan and in the soundness of centralized computing, which is now back with virtualization. Instead, we focused on standardizing our IT environment and practices to facilitate agility.
The agility has enabled IT to scale infrastructure and staff -- and to do whatever it needs to do to transform the business. The foundation of the 15-year IT strategic plan has anchored this activity with a vision that is withstanding the vicissitudes of technology and business.
What makes this story so compelling is that it is being told against a backdrop of thousands of companies that struggle annually in the funding and deployment of IT. For most of these organizations, it would take a dramatic leap of faith (and a complete change of management philosophy) to entertain the idea of a longer-term plan built on standards and the ability and desire to deliver consistent value that transforms the business for the long term.
Nevertheless, when you look at the results, it’s hard to argue with success.