What is Happening? Saugatuck Technology research among enterprise business and IT executives makes clear one of the most substantial and disruptive trends seen since the advent of the Web, email, and distributed computing:

The pace of Cloud-driven business innovation is outstripping even the accelerating pace of IT innovation – and therefore is outpacing the abilities of established IT and business management organizations and structures.

The net result: Increasing complexities and costs of doing business and managing IT, in a time when Cloud promises to help organizations and leaders deliver exactly the opposite.

Why is it Happening? The complexities with which IT and Finance (especially procurement) organizations have to struggle with stem from a lack of practices, cases and policies, all of which come from a lack of experience with an increasingly undefined, free-range work and life environment without clear boundaries between entities, systems, and processes.  Saugatuck’s name for this exceptionally liberating and challenging situation: The Boundary-free Enterprise (read, “Boundary-free Enterprise™: Empowered by the New Master Architecture”).

How we do business tends to be defined and limited by what technologies we use and how we use them. Suddenly, we have more technologies that can be used in many different ways, many of which were unplanned or unforeseen – which makes them practically unmanageable using current methods.

It’s not just Cloud that is enabling or driving these changes and these accelerations in complexity and cost. More exactly, it is Cloud-enabled, and user-inspired, innovation that is causing both the changes and the dizzying pace of change (read, “Cloud Drives New Innovation and Business Velocity”).

This innovation is not coming directly from the technologies or from the services that rely upon and deliver the technologies. The innovation is coming from within the enterprise, within the user groups and organizations that suddenly have more technologies that work in ways they desire, using devices that they are comfortable with, creating the ability to build, refine, adapt and use practically any aspect of business and consumer IT, almost anywhere they want or need to be (read, “When Innovation is the Norm, Adaptation – Not Speed – Must be the Standard”).

Put another way, users are taking advantage of Cloud, Mobility, Social/Collaborative IT, and Advanced Analytics to create and adapt ways of doing business that were often significantly less than optimized, because they relied on specific sets of technologies used in specific ways in certain situations.  

Now, there are fewer and fewer ways to delineate and isolate those technologies, systems and situations. That means that, although we continue to use and rely on them, our ways of managing those technologies, systems and situations are increasingly inadequate – and therefore increasing our risks, liabilities, and costs.

For an extended version of this Research Alert, visit Saugatuck Technology.

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