Meet the Newest Profit Center to Join the Enterprise: The IT Department
No Longer Just a Cost Center, IT Must Think Long-Term and Leave a New Legacy of ROI
March 02, 2017

Tim Flower
Nexthink

Share this

For decades IT departments have been regarded as "cost centers" — departments and entire divisions made up of necessary expenses which don't produce any measurable profit but instead help companies avoid losses by ensuring uptime, addressing end-user concerns and implementing C-suite approved technologies. As noted by the Harvard Business Review (HBR), however, this attitude is changing: Companies now recognize the potential of IT departments to drive total ROI and boost the bottom line.

To live up to this new role, however, IT must lose the short-term mindset, which, to be fair, has often been necessitated by one-off and sudden-impact issues. IT managers must adopt a long-term strategy in order to create new revenue, improve profitability, future-proof the corporate technology landscape and leave an ROI legacy.

Changing Conversation

According to a recent Forrester report, companies are coming around to a new way of thinking about IT, especially as applied to end-user experience management. Businesses now recognize the need to obtain ground-floor data about how end-users interact with IT systems "in the wild" instead of relying on pre-designed stress tests or waiting for front-line staff to submit IT tickets. The former method puts tech pros in a reactive rather than proactive position and encourages end-users to seek out their own answers, bypassing IT.

The Forrester data tells the tale: While 28 percent of companies put improved end-user productivity among their top-five goals, cutting the cost of end-user support was similarly prioritized. Leading their priorities was cutting the total cost of end-user operations using active monitoring tools. While not a revenue generator in isolation, this priority speaks to the emerging long view of IT departments: If real-time monitoring tools can reduce the costs of end-user operations by quickly addressing issues and determining root causes, this money can be re-invested into more "profitable" areas of IT such as deep-data analytics or social media tools.

Getting SaaSy

Another key driver of the emerging long-term view is the huge Software-as-a-Service market. As noted by WhaTech, the SaaS market is headed for a $170 billion-dollar value by 2025 as companies leverage the power of off-premise software. But it's not the only game in town — according to Forrester, companies must now bridge cloud-native, SaaS and packaged applications, all of which run on different platforms and may not play nicely together. The result? Thirty-six percent of companies surveyed by Forrester have adopted multiple clouds to ensure their SaaS stable can coexist with cloud-native offerings and in-house applications.

While this might seem short-sighted on the surface, it's a testament to the necessary future of IT: As cloud becomes ubiquitous, it only makes sense for companies to adopt the ideal combination of on-site, public and private clouds to cover all the bases. In effect, this doesn't limit IT potential but rather expands it, giving departments the room and resources they need to develop profitable initiatives rather than remaining locked in by limited network compatibility and outdated views of IT as a cost-center.

The role of IT is making a transition from a cost center that is simply chasing problems, to a profit center that is thinking long-term to implement strategic initiatives that leave a legacy of ROI. In doing so, IT needs to implement innovative tools and technologies, and work in collaboration enterprise-wide to better understand the needs and challenges of end-users to ensure a better business outcome.

Tim Flower is Director of Business Transformation, North America, at Nexthink
Share this

The Latest

April 18, 2019

A vast majority of organizations are still unprepared to properly respond to cybersecurity incidents, with 77% of respondents indicating they do not have a cybersecurity incident response plan applied consistently across the enterprise, according to The 2019 Study on the Cyber Resilient Organization, a study conducted by the Ponemon Institute on behalf of IBM ...

April 17, 2019

People and businesses today make mistakes similar to Troy, when they get too enamored by the latest, flashiest technology. These modern Trojan Horses work through their ability to "wow" us. Cybercriminals find IoT devices an easy target because they are the cool new technology on the block ...

April 16, 2019

Software security flaws cause the majority of product vulnerabilities, according to the 2019 Security Report from Ixia's Application and Threat Intelligence (ATI) Research Center ...

April 15, 2019

The majority of organizations (nearly 70 percent) do not prioritize the protection of the applications that their business depend on — such as ERP and CRM systems — any differently than how low-value data, applications or services are secured, according to a new survey from CyberArk ...

April 12, 2019

While 97 percent of organizations are currently undertaking or planning to undertake digital transformation initiatives, integration challenges are hindering efforts for 84 percent of organizations, according to the 2019 Connectivity Benchmark Report from MuleSoft ...

April 11, 2019

Companies have low visibility into their public cloud environments, and the tools and data supplied by cloud providers are insufficient, according to The State of Public Cloud Monitoring, a report sponsored by Ixia ...

April 10, 2019

Without improvement in time and budget constraints, the majority of tech pros (75 percent) say they will be unable to confidently manage future innovations, according to IT Trends Report 2019: Skills for Tech Pros of Tomorrow, a new report from SolarWinds. This reality ultimately puts businesses at risk of performance and competitive advantage losses, making the prioritization of skills and career development for tech pros paramount ...

April 09, 2019

Tech pros have one foot grounded in today's hybrid IT realities while also setting their sights on emerging technology, according to IT Trends Report 2019: Skills for Tech Pros of Tomorrow ...

April 08, 2019

This Thursday EMA will be presenting a webinar — Automation, AI and Analytics: Reinventing ITSM — covering recent research. There were quite a few surprises. And in fact, many of the surprises indicated a yet-more-positive outlook than we expected ...

April 05, 2019

Almost three-fourths (69 percent) of organizations have plans to deploy 5G by 2020, according to a new 5G use case and adoption survey by Gartner. Organizations expect 5G networks to be mainly used for IoT communications and video, with operational efficiency being the key driver ...