The Future of Corporate IT - IT Embedded in Business Services

Radical Shift 2: IT Embedded in Business Services


The suggestion for this shift is that the Corporate Centre is reaching its limit in driving further efficiencies for centralised functions such as Finance, HR, Supply and IT. The next way of seeking further efficiencies is by combining these functions into a joined Corporate Business Services unit. The back-office operations for these functions have similar aspects that are particularly suited for outsourcing and off-shoring. Global System Integrators and Business Process Outsourcers such as Accenture, IBM, Infosys and Wipro have been building capabilities over the last years and are arguable able offer this in an integrated way across various functions.

For IT in specific, the increasing adoption of ITIL v3 provides a good platform for outsourcing or collaboration between partners. Core ITIL processes like incident, problem and change management are applicable to other functions as well and could drive significant improvement in the (currently limited) effectiveness and efficiency of non-IT outsourced (or centralised) functions.

The opportunity here is to approach the provision of business services in an integrated way as it will involve services from a number of functions. The paper quotes the example of establishing a new supplier which requires services from Supply, Finance, Legal and IT. The onboarding of new staff or contractors is another good example where HR, Finance and IT are involved.

With Asset-Intensive industries like Natural Resources, distinction should be made between common services that are delivered across the corporation and Asset or Business Unit specific IT services. The former are Enterprise Services that lend themselves for centralisation and integration with other business services to provide integrated services for specific activities (e.g. staff onboarding, customer creation, master data management).

Business Unit IT services will focus on Safety, Manufacturing (MES, Process Control) and local functional systems (as few as possible) which will fulfil specific requirements. Similar to the previous Shift, the focus on delivering BU IT services will require in-depth knowledge of operations and strong engagement with the business. Infrastructure management and application support can still be outsourced but need to be localised.
 The challenge in differentiating ‘Enterprise’ and ‘Business Unit’ services is to do this in a way that accountabilities are clearly defined, boundaries are clearly marked and that the provided services still co-exist to deliver a seamless end-user experience. Achieving this is a prerequisite for (Enterprise) IT Services to be embedded in Business Services.
 Frits de Vroet