Leadership Vision for 2019: Infrastructure and Operations ...€¦ · This Leadership Vision...

Leadership Vision for 2019: Infrastructure and Operations Leader


1 © 2018 Gartner, Inc. and/or its affiliates. All rights reserved. Gartner is a registered trademark of Gartner, Inc. and its affiliates.

Hello and welcome! I’m Milind Govekar, the chief of research for Gartner’s Infrastructure and operations IT leaders research.

This Leadership Vision presentation is one of eight similar role presentations that will help IT leaders to be successful in thedigital age.

I'm going to cover two things with you in this brief audio overview. The first is a summary of how to use the accompanying PowerPoint presentation titled: "Leadership Vision for 2019: Infrastructure and Operations Leader."

The second is a summary of what’s actually IN the presentation.

So let's talk about how to use this material.

This research is in the form of a presentation deck published and updated on gartner.com at least annually since 2016. It provides Gartner’s overall point of view on the important things you, as a leader, must do over the next year. This deck is designed for you to download and use with your peers, your team or others who might benefit from it. You can also integrate it into your own materials. It is meant to provide input into your strategy or plans for the upcoming year to 18 months.

For example, digital initiatives will be central to most Infrastructure and operations leaders’ plans. Scaling digital in anyenterprise is a team sport. That means, you, as an I&O leader, will have to work with other IT leaders, business unit leadersand your CIO to deliver the key business capabilities your organization needs to be successful.

I&O leaders can use this deck with their peers in applications, enterprise architecture, security and risk, sourcing and vendor management, and other areas, to help them understand the I&O world. You can also use it with your leadership and broader team to share Gartner’s perspective on your team’s important initiatives in the year ahead.

To help you interpret the material and make it your own, this presentation deck has useful information in the Notes section of the slides and additional links to Gartner research, so you can dig deeper on each topic outlined on the slides.

This presentation is a critical tool to ensure corporate and personal success for I&O leaders.

Now let me talk about the content included in this deck.

Our 2018 global CEO survey of 460 CEOs shows that unprompted use of the word "digital" in strategic business priority mentions is at a five-year high. CEOs expect digital revenue to grow 10.3% each year between 2017 and 2020. Thus, CIOs are preparing for a more disciplined and scalable deployment of digital business changes ahead. In line with these initiatives, our main theme for all the leadership vision decks for 2019 is how to scale digital initiatives throughout your enterprise.

As an I&O leader, you are constantly under pressure to lower costs, improve quality of service and lower risk. In the digitalworld, this is necessary, but not sufficient. Scaling digital across the enterprise needs systemic agility and innovation. This deck provides actionable advice on how you can deliver these requirements.

If there’s one thing you should take away from this material, it’s this: I&O leadership is no longer "business as usual." It's about driving change and disruption through a product-aligned, business-embedded operating model that enables agility and innovation.

We've seen from our 2018 I&O leadership survey that alignment with the line of business has become one of the top-three goals for you. To drive this alignment and help your organization achieve its goals, you will need versatilists, programmableinfrastructure, agile processes and a product-embedded organization.

The material in this deck provides the fact base for our thinking, as well as actionable advice for you to achieve these goals. It also highlights major trends and challenges related to your role, and provides practical advice and best practices to overcome these challenges and successfully deliver the expected business outcomes.

I hope you download this presentation and find it helpful on your digital journey.

Thank you!



This presentation is a critical tool to ensure corporate and personal success. It highlights major trends

affecting the infrastructure & operations role and major related challenges. It provides practical advice

and best practices to overcome these challenges and successfully deliver the expected business

outcomes.

This scenario is part of a series of seven covering the whole set of Gartner IT leaders, namely:

• "Leadership Vision for 2019: Application Leader“

• "Leadership Vision for 2019: Data and Analytics Leader"

• "Leadership Vision for 2019: Enterprise Architecture and Technology Innovation Leader"

• "Leadership Vision for 2019: Infrastructure and Operations Leader“

• "Leadership Vision for 2019: Program and Portfolio Management Leader"

• "Leadership Vision for 2019: Security and Risk Leader"

• "Leadership Vision for 2019: Sourcing and Vendor Management Leader“

I&O leaders can use this PowerPoint presentation to understand and act on:

• What are the major trends and challenges affecting the I&O leader?

• What is leadership in the digital age for an I&O leader?

• What actions and next practices should an I&O leader and team implement?

• How do leading organizations deliver the highest value using I&O?

You as infrastructure and operations leader can use such research material — or part of it — to raise

the quality of your own teams, better influence the other IT leaders, and communicate the value of the

I&O organization to the higher ranks of the organization and other stakeholders. This also involves

working collaboratively with other roles, such as enterprise architecture leaders, security leaders,


‹#› © 2018 Gartner, Inc. and/or its affiliates. All rights reserved. Gartner is a registered trademark of Gartner, Inc. and its affiliates.

application leaders and others.



It has never been more important for I&O leaders to listen to their line-of-business managers.

If they continue to focus more on infrastructure management rather than working with and responding to the needs of the business undergoing a digital transformation, they will become less and less relevant.

They must be instrumental in solving business problems in the digital age.

The call to action exists in most organizations — we simply have to listen!

Specifically:

1. We have to help simplify interactions in our ecosystem, not just in our organization.

2. We need to respond with more agility to grow the business by matching changing demands.

3. We need to attract and retain the right breadth of skills.

4. We need to work together as a team — pulling in the same direction



Recommended Reading

“Adaptive Business Engagement”

“Adaptive Digital Engagement Model (Intel)”

https://www.gartner.com/document/3876015?ref=solrAll&refval=207649254&qid=d335d72acc9d972f6d05c858254be4dd






The agenda (or key issues) for this presentation is divided into these four areas:

1. What are the major trends and challenges affecting the I&O leader?

2. What is leadership in the digital age for an I&O leader?

3. What actions and next practices should an I&O leader and team implement?

4. How do leading organizations deliver the highest value using I&O?

Please note that not all the key issues have equal number of slides as we focus on providing actionable advice and case studies in key issues 3 and 4.



Gartner's ”2018 CEO Survey: CIOs Should Guide Business Leaders Toward Deep-

Discipline Digital Business” showed us that a CEOs' No. 1 priority in 2018 is growth — and

that priority has remained since 2017. CEOs told us that, in 2018 and 2019, as usual, they are

focused primarily on growth. In the background, we note that CEOs' use of the word "digital"

has been steadily rising.

When asked to describe their top-five business priorities in their own words, the number of

respondents mentioning the word digital at least once in their replies has risen from 2.1% in the

2012 survey to 13.4% in 2018. This set of bullish sentiment indicators toward digital business is

backed up by CEOs' continuing intent to invest in IT Thus I&O leaders have to be active

contributors toward their organizations digital success in delivering growth by helping scale

digital initiatives throughout their enterprise. This means working closely with their line-of-

business leaders.

The 2018 CEO survey also shows that scaling digital should be a CIO priority. In addition,

Gartner’s Peer and Practitioners research shows there is a correlation between digital maturity

and total shareholder value.

Let us start by examining specific I&O trends identified in a Gartner I&O leaders survey.

This research was conducted via an online survey from June 15th to June 26th, 2018, among

Gartner Research Circle Members — a Gartner-managed panel composed of IT or IT-business

professionals

In total, 96 members participated. Participants were business end-users with either an IT or IT-

https://www.gartner.com/document/3870869?ref=solrAll&refval=207022544&qid=39712c01db9b7ad0512835aa889ee3fe



business focus as a primary role. Qualified participants are responsible for or

influence IT I&O decisions and are aware of how I&O engages with the rest of the

company. The survey was developed collaboratively by a team of Gartner analysts

and was reviewed, tested, and administered by Gartner’s Research Data Analytics

team.



This year’s I&O leaders survey shows that 69% (cumulatively) of respondents have line-of-business

leaders as their largest consumers of I&O services, followed by application development leaders.

while application development has been the traditional consumer of I&O services, the rise of line-of-

business leaders as the primary consumer of I&O services provides I&O leaders with a good

opportunity to influence and participate in key business capabilities that those leaders are trying to

deliver to the end consumers.

Furthermore, listening to and working with the line-of-business leaders is apparent here.

Recommended Reading

“Adopt a New I&O Operating Model and Organization Design for Digital Business”

https://www.gartner.com/document/3865565



The two most important goals of I&O are to improve quality (55%) and lower costs (46%).

Cost optimization is always front of mind and was, in fact, the number-two answer, but both reducing cost and improving quality may end up being internally focused goals. Both quality and cost have been in the top-three goals for I&O leaders focused on services thinking.

However, scaling digital requires business alignment as the top goal to evolve to a product leadership organization.

Be aware that the needs of line-of-business leaders will vary, but for scaling digital, the focus has to be on the external customer.

Furthermore, improving quality and lowering costs have to be put in context or aligned with the products or services the business provides to their end customers.

However, I&O leaders must overcome challenges to scale digital across the enterprise.

Recommended Reading

“Optimizing I&O Costs and Investments Primer for 2018”

“Seven Deadly Sins of I&O Cost Optimization and Transformational Investment”

“Two in a Box Product Management (Comerica Bank)”



https://www.gartner.com/document/3886367?ref=solrAll&refval=207920180&qid=5ea8b01aef5cf9865c0fbadc1fd68c41



The same I&O leaders survey also shows that its no surprise that “managing technology challenges” continue to dominate (53%). When it comes to people, process and technology, technology always seems to be the most pressing and, in all honesty, is the original driver for I&O existence.

However, people and skills are not far behind (43%) with process change in third (34%).

Managing technology challenges become an important issue to deal with as a large legacy environment has a big impact on changing at the pace of business.

Scaling a digital business will require the ability to continually change and have the right skills and resources to deliver the right business outcomes.

I&O leaders should also work with application leaders in this area.

Recommended Reading

“Use Continuous Modernization to Build Digital Platforms From Legacy Applications”

https://www.gartner.com/document/3846764?ref=solrAll&refval=207920362&qid=1c2e6ff17169c2db7375a281d712fb75



To scale digital, all roles need to change their approach to leadership and lock-in to product thinking to enable digital capabilities. I&O leadership should move from technology thinking through services thinking to arrive at product thinking.

Ten years ago, I&O built and implemented dedicated systems and infrastructure for applications that were used by the business. These systems were managed by individual technology silos for storage, compute and network. This meant a technology-centric approach that crafted dedicated solutions for specific business requirements.

Today, I&O has moved toward providing services across technology silos, and provides shared systems/infrastructure. This means a service-oriented view that optimizes costs and uses process standardization to industrialize the delivery of services to the business. In other words, delivering the right services at the right time with improving quality at lower costs.

This is necessary but not sufficient. Digital business needs platform thinking, which needs a “product” focus that centers on the continually changing requirements of the external customer (not the internal business customer).

Agility and innovation become key requirements, with the ability to make the most of an ecosystem of partners. This means that I&O leaders have to create a digital business platform that takes a programmatic, API-centric approach to infrastructure. This approach has to start now and become mainstream by 2020 (see “How to Provide Strong I&O Digital Platform Leadership”).

Digital business platforms deliver products, such as airline reservation systems, insurance claims processing, or internet banking to customers. Products become the key defining unit of value that enterprises deliver, service and monetize as part of their digital business outcome. Products become the key design principle for customers and employees. I&O must become part of the value stream delivery team(s) that serve the product over many releases. I&O teams must prioritize the product backlog over other concerns, such as internal I&O projects that may not add any value to the product. This will ensure that I&O funding has a direct link to the product outcomes.

https://www.gartner.com/document/3852325?ref=solrAll&refval=207028899&qid=4a436eece2cb412f91146f87cf6afdd3



So… how should we define leadership in the digital age?



To work with the business, I&O leaders need to become digital leaders, which means developing a culture of trust, purpose, engagement, commitment, collaboration and a passion for learning.

Most importantly, it requires a relentless commitment to making progress.

It is a people-first principle and requires a willingness to change your leadership style and approach to each situation as circumstances change.

These attributes are essential for leaders to not only shift to product thinking, but to realize a product-aligned organization that drives value and innovation.

Recommended Reading



“Leadership in the Digital Age: A Gartner Trend Insight Report”




To meet the challenges of scaling digital head-on, IT I&O must become more adaptive.

An adaptive IT organization accelerates the rest of the business rather than hindering it.

It changes direction as demands change, and flexes between different modes of business collaboration based on context.

The best way to become adaptive is to transform I&O.

I&O leaders need to rethink their approaches and priorities in these four key areas:

1. Technology

2. Business management

3. Process

4. People

Let us start with technology.



Some of the puzzle pieces seem to be filled or are in the process of being addressed.

As this slide shows, survey respondents say their organizations are increasing their investments in public cloud computing, IT infrastructure automation tools, and cloud and governance tools.

Infrastructure and automation tools provide a modern, automated way to manage repetitive infrastructure administration tasks. This approach can reduce costs by standardizing the infrastructure, automation workflows and scripts as much as possible. Moreover, automation should also be aligned with the agility that business services require. Infrastructure automation tools are necessary to enable agility in this environment — for example, to spin up new infrastructure, maintain configurations, and to set up and tear down environments.

Scaling digital business initiatives mandates better quality and higher agility in addition to lower costs. Sixty-four percent of surveyed I&O leaders are looking into increasing their investments in public cloud during the next two years.

The combination of infrastructure automation tools and public cloud investments — together with the necessary skills — provides an opportunity to increase quality and agility, and lower costs, particularly capital expenditure. However, I&O leaders should guard against ungoverned cloud environments in which public cloud expenses can get out of hand.

They must use infrastructure automation tools to take appropriate actions (for example, shutting down idle servers to manage costs). Cloud expense management tools can help visualize and minimize these costs. I&O leaders must also keep edge computing in their sights when implementing cloud.

As these technologies will be critical to scaling digital, how should I&O leaders take an architected and systematic approach?



Scaling digital will need a scalable programmable platform.

Cloud computing will provide agility, scale and cost benefits to enterprises, however enterprises should be mindful of the impact of edge computing.

Investment in automation will be key for digital environments to improve time to market and agility, however most automation implementations today are opportunistic.

To make these investments systematic, automation must be driven intelligently.

By 2023, 15% of all automation will be heuristics-based and intelligence-driven, up from less than 5% today.

So how are I&O leaders adopting this technology?

Recommended Reading

“2018 Planning Guide for Cloud Computing”

“The Future Shape of Edge Computing: Five Imperatives”

“Market Guide for Edge Computing Solutions for Industrial IoT”

Market Guide for Cloud Management Platforms”

https://www.gartner.com/document/3810365?ref=solrAll&refval=207920975&qid=ec89164079e66ae44be902e85d21c3b8

https://www.gartner.com/document/3880015?ref=solrAll&refval=207920935&qid=badb3c04bfc8485f2a97ed65191ce6b8





I&O leaders will have to architect and implement a programmable infrastructure.

As many organizations start to scale digital business projects, their goals — reduced time to market, rapid functionality releases and the ability to make rapid infrastructure changes —become critical. The urgency is clear, but how should organizations invest to create a programmable infrastructure?

By designing, provisioning and operating an API-driven infrastructure.

This will help to deliver continuous insights across IT operations management, not only the point-in-time status. A continuous-delivery approach requires continuous insight and the ability to automate responses. This ensures that the right infrastructure resources are available at the right time, and in the right place.

Organizations cannot simply apply automation to existing monolithic infrastructure components. Doing so will result in frustration due to the awareness of agility and response demands without fundamental infrastructure components to deliver on requirements — in essence, automation without platform agility. Achieving platform agility is not just about refreshing data center infrastructure to modern platforms like HCIS, although this may form part of the strategy. I&O leaders should consider all areas of the platform — public and private cloud, new infrastructures for new products and services, as well as the modernization of legacy infrastructure. They must address all of these aspects in the strategy to enable bimodal delivery.

To realize a programmable infrastructure requires investment in platform components that are software-defined and that provide APIs to automate and orchestrate workload management across private, hybrid and public cloud and infrastructure platforms.

APIs provide programmatic access to I&O services and data. These should be implemented so that I&O consumers (such as developers) can consume services and data to create new business solutions. I&O staff should be trained in using web technologies (such as HTTP and JSON) to develop these APIs. I&O leaders also should manage APIs as a technology product and implement full life cycle management, including version control and roadmaps.

Overall I&O will have to intelligently orchestrate various automation capabilities across adiverse set of technologies and platforms

I&O leaders cannot ignore security and should work with security leaders to secure the digital environment.



No single, homogeneous security technology can protect all of your IT assets ranging from your infrastructurelayer to edge processing to middleware and also including back-end systems and data.

Key requirements in the multi-tier architecture for security include discovery, provisioning, authentication, data protection and anomaly detection and response. Weak points in the security architecture include the integration points where data undergoes transition or transformation.

I&O leaders should use a risk-based assessment to prioritize security investments in new security tools to complement and/or extend existing cybersecurity to protect business data, apps, networks and platforms.

Security requirements:

• Policy creation and management

• Monitoring, detection and response

• Access control and management

• Data protection

• Network segmentation

Key challenges:

• Scale

• Diversity (age and type)

• Function

• Regulation

• Privacy

• Standardization

Another technology that will be necessary to scale digital and augment skills of the I&O staff, is artificial intelligence.



Artificial intelligence (AI) and machine learning (ML) are still in their infancy and retain a

significant level of hype.

Our survey results show that the actual adoption of AI and ML technologies is still quite low

with data and analytics taking early advantage for big data use case.

Similarly IT service management automation presents an opportunity through chatbots and

AI helpers.

Perhaps what is of most interest for the I&O leader is the intent to apply AI and ML to

improving business productivity through to the end of 2019. The highest response within this

category.

This is necessary to scale digital across the enterprise, but is not sufficient as the

benefit of AI to deliver growth is in transforming the business.

Recommended Reading:

“2018 Strategic Roadmap for Compute Infrastructure”

“When Will AI Virtual Support Agents Replace Your IT Service Desk?”

https://www.gartner.com/document/3871108?ref=solrAll&refval=207921267&qid=ed085f12b970cd0b333eb68d7373d4c0




Most IT and I&O organizations start their AI initiatives in the zone of learning to develop their understanding and skills for AI.

They then progress to drive automation using AI, which results in improved efficiency and optimization of the services and products they provide.

Likewise, business unit AI projects begin in the zone of learning and then progress into the zone of productivity as they embark on a product-oriented approach for their digital initiatives.

This leads to improved results and productivity from their business processes. However, the biggest value of AI is in the transformation of the business where new business models enable an organization to drive additional growth and improved customer satisfaction.

I&O leaders should work with their line-of-business managers to move from the zone of automation and zone of productivity to the zone of transformation.

I&O leaders can use AI to drive many of their I&O initiatives such as service management, APM, workload optimization, cloud management platforms and others.

Let us now look at the I&O process transformation.

Recommended Reading

“Four Best Practices to Devise Effective I&O Strategies for AI Initiatives”




When embarking on the process journey, I&O leaders should be aware of a core conflict in this area. This conflict inhibits the optimization of the system, and creates stress among stakeholders.

• The first logical branch dictates that: In order to be successful, we must enable the business faster.

• The second logical branch dictates that: In order to protect the business, we must have the proper controls in place, take our time to do things right, and go slower.

The problem is that these two branches are happening in parallel, and create the type of organizational conflict we tend to see every day.

This conflict could be between:

• Groups concerned with enabling the business (sales, marketing and development) and…

• Groups concerned with protection (accounting, legal counsel, IT operations and information security)

It's not that one group doesn't "get it" — it is operating in the environment that management created.

If you combine this and the need to protect the "secret sauce" of an organization, we tend to have enterprise processes that gravitate toward risk aversion and going slow.

It is critical for I&O leaders to realize that multiple approaches are required to balance speed and risk in support of business outcomes. This means that multiple reference sources are required —not just DevOps and established frameworks such as ITI

In a digital business environment, going slow is not an option.

We know that I&O leaders have invested heavily in ITIL for managing and stabilizing their IT environment. However, growing the business and agility need a completely different set of processes.

See ”Use a ValueOps Perspective to Balance Risk and Agility in IT Operations”

http://www.gartner.com/document/2266515?ref=solrResearch&refval=208512734&qid=



The same I&O leaders survey shows that, in order to go faster, I&O leaders need to focus

on capabilities that prioritize scalability and time to market.

Agile processes like continuous integration and delivery, and DevOps, combined with a

programmable infrastructure built from software-defined infrastructure allow us to design

for automation.

However, agile doesn’t always just mean fast.

Recommended Reading

“Agile and Continuous Delivery Tool Chain”

“Solution Path for Achieving Continuous Delivery With Agile and DevOps”

To Automate Your Automation, Apply Agile Practices and DevOps Tools to Infrastructure

https://www.gartner.com/document/3818564?ref=solrAll&refval=207922314&qid=f98bb3dc15c0657c51850eb6b064f13f





and Operations”




Agility must absolutely be a goal for I&O processes to support digital business.

But lets be clear what agility is. "Agile" and "fast" are not synonyms, even though they are often used

that way. A train may be very fast. But it's going to stay on the tracks — on the path laid out for it

decades before. A fighter jet is both fast and agile. It can change direction in response to what is going

on around it, and what the pilot wants to do.

This is the heart of agility.

The definition of business agility used by the online Business Dictionary states: "The capability of a

company to rapidly change or adapt in response to changes in the market."

So the ability to sense a change in the market, or the needs or the requirements, is a fundamental

attribute of agility. We must both sense and respond in order to be considered agile.

I&O leaders should not use a single process framework and practice for digital business initiatives, but

must agree on their overall approaches to process and risk with their business customers.

Make your business goal to have an agile organization, not a set of fast individuals.

Start implementing agile I&O processes with relatively simple "island" initiatives that feature simple

interdependencies between modes. This means that as digital business moves from innovation as a

side activity to a core competency, infrastructure and operations leaders must adopt new practices

such as DevOps and creatively interpret frameworks such as ITIL.

Overall, implementing agility needs a different approach.

Recommended Reading

"I&O Must Combine ITIL and DevOps to Deliver Business Value for Bimodal IT“

https://www.gartner.com/document/code/291784?ref=grbody&refval=3287829



"How Digital Business Affects I&O Processes"

https://www.gartner.com/document/3287829?ref=solrAll&refval=188004556&qid=96e8ef653c4c860809c9c140b1503571



This need for agility and a shift in organizational thinking is captured within a movement referred to

as "DevOps" — cultural/mindset change that tears down the traditional walls within IT (Development

is shown on the left side of this slide, Operations and security on the right side) to deliver faster IT-

enabled capabilities for the business.

Whether you call this "DevOps" or simply the need for speed and IT agility, the result is the same.

IT needs to be able to provision and/or deprovision workloads more quickly and, to do this, people,

tools and processes must change.

Security needs to be an integral part of this transformation — thus the term "DevSecOps," bringing

security into the center of this shift

I&O leaders responsible for DevOps must use automation tools to create a scalable DevOps

toolchain.

I&O leaders should choose and position tools by mapping the tools' capabilities to DevOps pipeline

activities to move to continuous delivery.

By applying the agile values from the development and operations relationship, DevOps can

streamline the development processes and continually improve.

Applying agile principles requires continuous integration (teams must test integration early and

often) and continue delivery (teams must mitigate the risk of human error and speed deployment by

automating wherever possible).

Agility should also be seen in the context of customer requirements.

Recommended Reading

“Reimagining Security and IT Resilience for a Cloud-Native DevSecOps World”

“Seven Steps to Start Your DevOps Initiative”

“DevOps Implementation Roadmap”

“Using DevOps Tools for Infrastructure Automation”

“Effectively Drive and Manage Change Around DevOps (Molina Healthcare)”

https://www.gartner.com/document/3876466?ref=solrAll&refval=207922743&qid=d475c2cb8d84cc98d9f3c18689f544f0

https://www.gartner.com/document/3199217?ref=solrAll&refval=188004896&qid=e55e17f3d4947f356064b0de6f3e91ba






Scaling digital requires I&O leaders to align with the business capabilities that the business provides to its customers.

This means that customer requirements shape the systems and support metrics for the I&O business.

The products and services need to be at the right quality and cost to fulfill the customer demand.

Let us now look at the business management initiatives an I&O leader must undertake, starting with the right operating model.

Recommended Reading

“How to Establish I&O Metrics That Matter to Business Leaders”

“Five Questions I&O Leaders Should Ask Before Funding a DevOps Initiative”

https://www.gartner.com/document/3866868?ref=solrAll&refval=207922803&qid=a1ee9aed93686af0d5f06348f106ab2b

https://www.gartner.com/document/3485417?ref=solrAll&refval=207923057&qid=a1ee9aed93686af0d5f06348f106ab2b



“You're Not Doing DevOps If You're Not Focused on the Customer Experience”

https://www.gartner.com/document/3059518?ref=solrAll&refval=207923083&qid=dc571b1f041ec6513c1e02cf888717ac



The move from projects to products is a critical component of the new IT operating model for digital.

The move to a product-centric delivery model requires major changes in the operating model, and some of these

are outside the control of the I&O leader. This means that the I&O operating model should be business-

embedded and not just business-aligned.

Business-embedded means

• We need a new operating model that is adaptive, agile and embedded.

• We need product orientation i.e., funding and resources are aligned by business capabilities that span both

IT and business units.

Many organization will have a structure where the platform team makes up 20-25% and the teams below

are 75-80%

Divisional/business product team enabled by infrastructure. A product-based approach to its software

delivery means divisional product teams will take a product from idea to operation. These teams consist of people

with multiskilled, multidepartment/business expertise. Embedded platform engineers provide product teams with

an agile, better-engaged infrastructure service.

Divisionally aligned platform engineering team. This is a pool of platform engineers skilled in automation,

software-defined infrastructure, API building and management, self-service-technology and service management.

The platform engineers provide the business units/divisions with localized infrastructure provisioning, service

management tooling, infrastructure stack and life cycle management.

Service management engineering team. This is a core engineering team to maintain and evolve the service

management platform. This team meets the changing demands of the business units/divisions and builds, runs

and improves the service management platform.

Infrastructure design authority. The infrastructure design authority works with the service management

engineering team, infrastructure architects and external service providers (including cloud providers) to design,

build and maintain the central infrastructure platform. This design authority owns the overall infrastructure and

data center modernization strategy, high-level design, reference architecture and deployment patterns.

I&O has to transition to this new model via an intermediate step.

Recommended Reading

.”Adopt a New I&O Operating Model and Organization Design for Digital Business”

”The New IT Operating Model for Digital”

“Launching an IT Product Line Management Model”

https://www.gartner.com/document/3865565?ref=solrAll&refval=207923244&qid=1708602ff0ffb861e3b611d9f2b1ce62

https://www.gartner.com/document/3770165?ref=solrAll&refval=188035283&qid=c607ac0f93af09be579861388c2a05bb

https://www.gartner.com/document/3823223?ref=solrAll&refval=207923329&qid=64a1daa0809aa0fdb418ff9b5629ab73



This transition necessitates our organizational model to be focused on a small move forward under the guidance of a product manager. Larger products will be composed of a number of feature teams or component teams, working under the guidance of an overall product manager owner. These are teams that work across the vertical siloes of application development, IT operations and security.

When left to their own devices, these teams will solve problems in different ways, use different protocols and database designs and have different approaches to security. We need a way to manage this diversity and, ultimately, long-term costs. This is what the communities of practice help to solve. These vertical teams may be quite small — in fact, if they do their jobs well, much of their guidance and best practices should become built into the automation tools so that complying with group standards becomes part of the natural ways of working. These communities are crucially important. They help to limit and control the long-term support costs that can quickly build up if the product teams have too much independence. We know that the most successful organizations, like Facebook and Spotify, have very strong disciplines and strong standardization. But this is a balance. We don't want to stifle innovation or the adoption of modern tools. So we're striving to make the right way the easy way, and we're trying to share good ideas and methods among the teams. We don't want the product teams in silos any more than we wanted development and operations in silos.

In this construct, what we may once have called the "infrastructure team" or "infrastructure and operations team," must now produce and manage the platform on which the products are deployed and run. And that includes the toolchain for things like infrastructure configuration, application release automation, monitoring and so on. Again, we don't want to pretend we know what that platform will look like at the start of your journey. The platform too should be an agile product. Start small. Expand over time as a series of steps and releases. Expand both horizontally — more servers and physical scale — and vertically with added features and capabilities, just like Amazon Web Services, which is continually adding new features to its own platform.

A new operating model needs a different way at looking at KPIs.


“Embrace DevOps Product Teams to Turbocharge Your I&O Organization and Control Costs”

https://www.gartner.com/document/3306717?ref=solrAll&refval=188035953&qid=63f0f2cc3c031fc59564ebe84f92a9fc



“Seven Key Attributes of Product Line Management”

https://www.gartner.com/document/3768355?ref=solrAll&refval=188035953&qid=63f0f2cc3c031fc59564ebe84f92a9fc



Rather than just demonstrating I&O’s adherence to standard service cost and quality expectations I&O KPIs in digital business transformation demonstrate I&O’s contributions to IT’s overall mission: Enabling enterprise agility, scalability, and customer centricity.

As such, infrastructure scorecards expose shared metrics that demonstrate the extent to which IT as a whole enables digital business transformation.

I&O KPIs that are part of a digital transformation should demonstrate:

• Enterprise speed and agility: Assisting IT and the enterprise to go faster and quickly meet new demands, rather than just making infrastructure processes go faster.

• Customer focus: Contributing to internal and external customers’ success, rather than just maintaining Infrastructure service; and…

• Workforce transformation: Demonstrating how Infrastructure’s workforce is transforming to work in DevOps and other agile paradigms, and in multidisciplinary and interconnected teams.

Other Focus 1 KPIs might include: Handoffs minimization scores, before-and-after cloud comparisons, defect-based release quality, mean time to recovery, or cloud cost efficiency.

Other Focus 2 KPIs might include: End to end service line health impact.

Other Focus 3 KPIs might include: Skills change velocity index, digital skills recruitment, and versatile experiences distribution.

One of the KPIs that is never far from an I&O leader is cost.


“Digital Business KPIs: Defining and Measuring Success”

https://www.gartner.com/document/3803509?ref=solrAll&refval=207923319&qid=5e38f9a03f0449fb70b65328348f0ccd



“15 Infrastructure KPIs for Digital Business Transformation”

https://www.cebglobal.com/content/infrastructure/us/en/member/research/inside-view/18/15-infrastructure-kpis-for-digital-business-transformation.html?searchString=Nationwide&screenContentId=200797839



I&O leaders should use Gartner’s IT cost optimization framework to lower, optimize and manage the costs of I&O product and service delivery. These initiatives can be tackled individually or together to magnify the benefits.

I&O leaders need to be mindful of the proliferation of cloud and infrastructure costs if they don’t apply robust asset management practices.

They should:

• Implement budgetary and fiscal standards

• Monitor and track budgets

• Perform ROI analyses to prove I&O contribution and value

I&O leaders should also understand the competitive landscape for their own services and understand alternative external sourcing options.

Furthermore, they need to be aware of any migration costs if the organization switches to alternative sourcing options. By knowing these factors, an I&O organization can maximize its own value-added contribution to the business.

People can either make or break digital initiatives. The next set of slides focus on how I&O leader should address this transformation.


“Seven Deadly Sins of I&O Cost Optimization and Transformational Investment”

“Toolkit: Five-Minute Cost Estimator for IT Infrastructure and Operations”

“Gartner's Decision Framework for Prioritizing Cost Optimization Initiatives”

https://www.gartner.com/document/3853073?ref=solrAll&refval=207923486&qid=98125b1ec441e38602b17ada02edb430

https://www.gartner.com/document/3324617?ref=solrAll&refval=207923486&qid=98125b1ec441e38602b17ada02edb430




“Toolkit: Using Gartner's Decision Framework for Prioritizing Cost Optimization Initiatives”




96% of I&O leaders are not ready with the skills needed in the next two to three years.

The world is digitalizing at a rapid rate impacting I&O.

Old behaviors, old leadership and old cultures are no longer sufficient.

New behaviors, new leadership and new cultures are needed for success.

Making the skills gap a critical success factor will help enable the I&O organization to deal with an accelerating pace of change.

As the business moves faster, not taking a proactive approach to managing a skills portfolio will result in an inability to maintain customer satisfaction and damages credibility.

This situation isn't unique to I&O. Applications and other parts of IT also must address major skill issues.

What are some of the roles that I&O leaders have to pay attention to?


“Analyzing the Role and Skills of the I&O Professional in DevOps”

“Transform I&O Skills to Remain Viable”

“Recruit, Renovate and Retrain to Gain the Skills Needed for the Digital Workplace”

“The Cloud and IaaS Skills Required for the Future”

“Survey Analysis: Enterprises Dipping Toes Into AI but Are Hindered by Skills Gap”

https://www.gartner.com/document/3885383?ref=solrAll&refval=207923554&qid=711e33a956a7e8d1b02de440d1a02f7c

https://www.gartner.com/document/3466417?ref=solrAll&refval=207923554&qid=711e33a956a7e8d1b02de440d1a02f7c

https://www.gartner.com/document/3873156?ref=solrAll&refval=207923612&qid=ce4abd7115cd7ae67883b1cd9246d509





I&O leaders will have to invest in new roles and responsibilities to help the business implement and scale digital across the enterprise. Not all of the roles shown on this slide will be needed by every I&O organization. Furthermore I&O may have to consider additional roles, including:

IT product manager: The IT product manager is responsible for analyzing and defining efficient, cost-effective solutions to support company objectives, business processes, and functional requirements through detailed knowledge of complex issues.

Full-stack engineer: A full-stack engineer is fully responsible for developing and maintaining the applications for end users, including building new internal systems, maintaining old systems, and scaling systems to the whole organization.

DevOps engineer: The DevOps engineer identifies and optimizes the interdependencies between application development and infrastructure operations through a collaborative approach to continuous delivery.

Service manager: The service manager functions as a single point of interface across all stages of demand planning for a specific service, and shepherds potential business opportunities from concept through execution, synchronizing IT development activity with business value realization.

Solution architect: The solution architect is a technical leader with a deep understanding of business goals, business processes, and enterprise architecture who works to conceptualize and assemble technology solution architecture designs to ensure that solutions meet business needs and are compatible with existing architectures.

Service architect: The service architect is responsible for designing infrastructure services, integrating them with the existing service catalog, and — where possible — identifying opportunities to drive greater efficiency through service consolidation.

Network architect: The network architect is responsible for iterating on network structure in pursuit of continuous optimization of cost and quality, including constant evaluation of emerging technology trends and business need.

I&O leaders will have to ensure that the people in their organization possess the right soft skills needed in the digital world.


“The IT Workforce for Digital: To Buy, Build, or Borrow?”

“IT Infrastructure Labor Market Trends”

“New IT Roles Checklist”

“Hiring Guide for Site Reliability Engineer”

“Hiring Guide for Employee Experience Manager”

“Hiring Guide for Automation Engineer”

https://www.cebglobal.com/content/infrastructure/us/en/member/research/17/hiring-guide-for-it-product-manager.html

https://www.cebglobal.com/content/infrastructure/us/en/member/research/17/hiring-guide-for-full-stack-engineer.html

https://www.cebglobal.com/content/infrastructure/us/en/member/research/17/hiring-guide-for-devops-engineer.html

https://www.cebglobal.com/content/infrastructure/us/en/member/research/17/hiring-guide-for-service-manager.html

https://www.cebglobal.com/content/infrastructure/us/en/member/research/17/hiring-guide-for-solution-architect.html

https://www.cebglobal.com/content/infrastructure/us/en/member/research/17/hiring-guide-for-service-architect.html

https://www.cebglobal.com/content/infrastructure/us/en/member/research/17/hiring-guide-for-network-architect.html

https://www.cebglobal.com/member/infrastructure/blog/18/08/the-it-workforce-for-digital-to-buy-build-or-borrow.html?referrerTitle=Search&referrerContentType=systempage&referrerURL=https://www.cebglobal.com/member/infrastructure/search.html&referrerComponentName=Search Results&pageRequestId=3b6a25a5-eeae-4980-920c-7ccdd31fc6d6&totalCount=20&currentIndex=4&searchString=Nationwide&screenContentId=200797839

https://www.cebglobal.com/content/infrastructure/us/en/member/research/report/17/it-infrastructure-labor-market-trends.html?searchString=IT roles&screenContentId=200797839

https://www.cebglobal.com/content/infrastructure/us/en/member/tools/13/new-it-roles-checklist.html?searchString=IT roles&screenContentId=200797839

https://www.cebglobal.com/content/infrastructure/us/en/member/research/17/hiring-guide-for-reliability-engineer.html?searchString=talent neuron&screenContentId=200797839

https://www.cebglobal.com/content/infrastructure/us/en/member/research/17/hiring-guide-for-employee-experience-manager.html?searchString=talent neuron&screenContentId=200797839

https://www.cebglobal.com/content/infrastructure/us/en/member/research/17/hiring-guide-for-automation-engineer.html?searchString=talent neuron&screenContentId=200797839



Technical skills are not enough. In addition to tech skills we need to look at soft

skills, especially those that enable critical thinking, teamwork and collaboration in

the context of understanding business needs. These soft skills are needed for

learning agility, that underpins a digital capability.

To round out the people capabilities, please see the next slide.


“New Competencies for a Digital Infrastructure Workforce”

https://www.cebglobal.com/content/infrastructure/us/en/member/blog/18/03/new-competencies-for-a-digital-infrastructure-workforce.html?searchString=talent neuron&screenContentId=200797839



Digital business initiatives will need people who are not only good at interacting with other people, but also able to interact with AI beings or conversational systems.

They also need to transition from a “hero” culture, focused on an individual set of capabilities to solve problems, to a “team” culture, to be able to collaborate and scale to solve problems in a digital world. Furthermore, a culture of confrontation and blame, often the case in less mature I&O organizations, needs to change to a collaborative/working together culture.

Reverse mentoring ensures that existing employees learn as much from the new entrants to the workforce as they do from existing employees, ensuring your employees become more dynamic while infusing new employees with the culture of the organization.

As millennials have become part of the workforce, various social learning technologies using social media and Gartner’s Peer Connect will help them jump-start their skills journey.

We will now look at some specific case studies that Gartner’s Peer & Practitioner group has put together.


“The IT Workforce for Digital: To Buy, Build, or Borrow?”

“Apply Staffing Ratio Factors to Drive I&O Business Value”

“Build I&O Staff Talent to Support Bimodal, DevOps and Cloud”

“Talent SWOT Analysis Tool”

https://www.cebglobal.com/member/infrastructure/blog/18/08/the-it-workforce-for-digital-to-buy-build-or-borrow.html?referrerTitle=Search&referrerContentType=systempage&referrerURL=https://www.cebglobal.com/member/infrastructure/search.html&referrerComponentName=Search Results&pageRequestId=3b6a25a5-eeae-4980-920c-7ccdd31fc6d6&totalCount=20&currentIndex=4&searchString=Nationwide&screenContentId=200797839

http://www.gartner.com/document/3452317?ref=solrResearch&refval=188037132&qid=66c6851b51bc0b52b25af786f67fc93f

http://www.gartner.com/document/3728918?ref=solrResearch&refval=188037132&qid=66c6851b51bc0b52b25af786f67fc93f

https://www.cebglobal.com/content/infrastructure/us/en/member/tools/17/talent-swot-analysis-tool.html?searchString=talent neuron&screenContentId=200797839



Monsanto’s scaling of its digital business journey started with identifying specific business opportunities and through enterprise and IT transformation. This meant equipping the business leaders for a digital future by transforming IT’s operating model to support a digital future.

The company’s three design principles were:

1. Focus on enterprise changes

2. Ensure applied learning

3. Use peer involvement to drive change

More specifically some of the key takeaways were:

• Dedicate roles to manage the shift to digital

• Triage digital expertise

• Promote platform-level decisions

• Flex engagement posture by digital acumen

• Align analytics to business capabilities (keep data shared)

• Adopt platform KPIs

• Move to platform funding




“Leading Digital Transformation (Monsanto Company)”

https://www.gartner.com/document/3825767?ref=solrAll&refval=207923945&qid=91103793ca3bd47a1000e073319dd451



Nedbank’s approach to redesigning infrastructure for product-line management:

Infrastructure needs to adapt to IT’s product-line model by defining its offerings based on how they are consumed by the IT product lines, rather than by technology towers or the supply side.

Key takeaways included:

1. Define infrastructure by how it is consumed, not how it is produced: To enable effective consumption of infrastructure by IT product lines and the broader business, infrastructure should position its offerings as “wholesale” products, to enable “retail” IT offerings.

2. Run infrastructure offerings as products: Assign standing full-stack teams to infrastructure products that can evolve the product, and rapidly adapt to new customer needs in the market.

3. Fund infrastructure products, not projects: To enable infrastructure products to respond to evolving market needs, IT should block-fund infrastructure products, allocating funding upfront, rather than based on project allocation or fixed cost.

Recommended Reading

“Infrastructure Full-Stack Teams for IT Product Lines”

https://www.cebglobal.com/content/infrastructure/us/en/member/blog/18/07/infrastructure-full-stack-teams-for-it-product-lines.html?searchString=Nedbank&screenContentId=200797839



Nationwide’s approach to skills management: Infrastructure staff need to regularly invest in learning new technical skills in order to remain relevant in the face of rapidly evolving enterprise needs from IT. Address the technology skills gap by effectively showing Infrastructure staff how diversifying their skill set both makes them more effective in their day-to-day and grows their future career options.

Key takeaways:

• Make the technical skill life cycle transparent: Allow staff to identify their own areas for new technical skill development by providing transparency into future enterprise skill needs.

• Create paths to technical skills development: Provide opportunities for staff to opt-in to learning a new skill.

• Pair apprentices with highly skilled workers: Encourage masters in emerging skills to coach peers on technical skills to help rapidly build up the team’s skills portfolio.


“Rebalancing the Technical Skills Portfolio”

https://www.cebglobal.com/content/infrastructure/us/en/member/blog/18/07/rebalancing-the-technical-skills-portfolio.html?searchString=Nationwide&screenContentId=200797839



In addition to the areas shown in the slide, other key changes are needed in the I&O transformational journey:

Goal/vision: IT I&O's mission of aligning services with business requirements has been a long-held ambition. Aligning services does not lead to the capabilities that make a difference to business outcomes in the digital era. IT I&O needs to be embedded in the business outcomes.

Value: The values of cost and efficiency are a given. Digital business needs agility and innovation to provide competitive advantage or to create new business models and opportunities. I&O leaders need to embrace these values as part of the bimodal journey.

Culture: I&O culture is also changing to focus on applications and not just infrastructure, with, for example, investments being made in the application performance monitoring (APM) area. This new focus is necessary but not sufficient. I&O leaders will have to drive increased collaboration with application development, enterprise architecture and other IT environments to deliver external-customer-focused outcomes. This collaboration will need increased adoption of DevOps and the treatment of infrastructure as code — not just something that needs to be administered.

Governance: In the digital platform world, I&O governance will need to change from an inhibitor to an enabler. This includes changing the attitude toward shadow IT. For example, instead of seeing it as something that must be resisted, viewing it as a partner in a larger ecosystem that is a digital platform.

Sourcing: In the technology and services era, the dominant discussion has been about I&O efficiency. This led to sourcing deals that involved outsourcing contracts or services to a few large technology providers or vendors that were seen as long-term partners for delivering business outcomes. Digital business needs agility, which means partnering with service and technology providers that may be small and nimble, more risky in terms of longevity, innovative yet efficient, and that enable experimentation (see “How to Develop a Pace-Layered Application Strategy").

Talent: People, skills and capabilities will make or break a digital platform initiative. I&O has traditionally attracted risk-averse, technically skilled and project-focused people. In light of the traditional demand for stability and cost reduction, these capabilities were necessary (see "Agility Should Be Among the Top Three Goals for I&O Leaders"). Digital platform capabilities need risk-embracing, product- and customer-focused talent (see "Creating Your Digital Edge Through a Competency-Based Talent System"). It also needs "versatilists" who are not just focused on specific technology, but who have a broad set of skills across multiple areas (see "Five Steps to Build Your Digital Business Dream Team").

Metrics: As I&O emerges from the technology and services mindset to a business innovation mindset, metrics that were based on cost reduction and optimizing services will not be sufficient — business innovation metrics that include agility will be needed. For example, a financial services organization that has a change control pipeline of five months for all changes will be unacceptable. Metrics that measure the speed of delivery of product functionality and capability to external customers become important.

Team velocity: In an environment where I&O is embedded in a product team, the speed at which this team delivers business outcomes will be measured. Consequently, collaboration and trust between IT and the business people of that team become paramount. In a digital business environment, functionality and capability for external customers may need to change hourly, daily or several times a week. This means that







the I&O organization needs to build the ability to deliver continuous innovation.



Gartner research addresses and fleshes out the key points touched upon in this I&O scenario presentation document.



We advise that I&O leaders take advantage of inquiry to discuss published and upcoming research with Gartner IT service analysts globally.

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