Fundamental progress has to do with the reinterpretation of basic ideas.
– Alfred North Whitehead

IT is a mere infant in the business world, having existed no more than a few decades. By contrast, professions such as accounting, production, economics, and marketing have been practiced for thousands of years, with at least three hundred years of well-documented experience to draw upon. For example, Adam Smith published his famous book “The Wealth of Nations” in 1776, more than two hundred and thirty years ago. Because IT is so new to the business and it has been granted special privileges, much has been tolerated that is not tolerated of the other business professions.

Businesses have allowed IT to communicate in its own language and deliver unreliable, disruptive technology solutions partly because IT is a young organization and partly because those technology solutions were revolutionary. Now, however, technology is going through a period of being more evolutionary than revolutionary, and business tolerance is waning. Businesses have been learning how to incorporate IT into the overall business structure and deciding whether IT is unique enough to require special attention or if it should fall in line with more traditional business professions. The increasing demands of IT from the business are a strong indicator that the latter approach is increasingly being adopted.

What does this mean for IT? It means that IT must move beyond the infant stage and begin to mold its behavior to fit the accepted model. IT must learn how businesses operate and adjust its behavior to fit the larger organizational model. To do that IT must understand the larger organizational model.

The model rests on the premise that businesses exist primarily to generate profit, or in the case of non-profits to fill a stated need. In most cases, IT indirectly contributes to profit generation/need fulfillment, but in other cases, IT is a profit generating activity itself. Even on those occasions when IT is the primary profit generating activity, it cannot generate that profit by itself.

Why, then, does IT exist? In almost every scenario, IT exists to support the business in its profit generating activities. IT does this by storing and sorting data, by facilitating communications, by speeding up business activities, by improving accuracy and consistency of repetitive activities, and by making possible novel approaches to profit generation. An example of the latter is the ability to order books over the internet from traditional brick and mortar bookstores, which provides purchasers the benefits of both the online experience and the benefits of a brick and mortar location for returns or browsing while allowing the business to increase its profitability.

Microsoft Exchange is a classic example of the increasing complexity and interdependent nature of current technology. With the introduction of Exchange 2000 and Windows 2000 Microsoft eliminated a very large duplication of effort. No longer were domain user data and email user data entered and stored separately. With this version, Exchange was given the power to access domain data directly eliminating the need to manage it separately.

From one perspective, this was a significant resource savings, which introduces the potential for even more savings by other technologies. From another perspective, however, it increased complexity, as now the domain services from Windows are critical to the functioning of Exchange and Exchange cannot function if Windows domain services are not installed and working properly. Many companies found that they had to invest significant resources to restructure their windows domain environment just to be able to properly implement Exchange 2000.

IT contributes to a larger business enterprise, which generates profits because it creates a series of processes that are relatively more efficient and effective than its competitor’s processes at providing goods and services. Within this enterprise, each entity must identify how it can improve these processes, and its improvements must contribute relatively more value than can be obtained elsewhere. IT contributes value primarily by providing technology services that enable other business entities to increase their contributions. For instance, IT contributes messaging services in the form of email and instant messaging that allows the business to rapidly and effectively share information, which in turn reduces cost and increases productivity.

The value proposition for the business is not a specific email technology. The value proposition is in being able to rapidly and effectively share information. IT adds value not by supplying technology but by supplying a messaging service that provides rapid and effective sharing of information.

For IT to find its rightful place in the business world, it must accept and embrace the idea that IT is a service organization whose primary mission is supporting the business.


Ron B Palmer
Ron B Palmer

Ron B Palmer is an internationally recognized expert on IT Service Management who also writes on strategy as it applies universally irrespective of its application in business, war, or politics. Ron’s approach is grounded in concepts such as quality, systems theory, complexity, fractals, and Economics. Ron holds the ITIL Service Manager and ITIL Expert certifications as well as numerous ISO/IEC 20000 certifications.