Thinking about Decentralizing IT? Here are Four Things to Consider

For several years now, IT experts such as M.I.T. researcher Joe Peppard have called for a complete dismantling of the IT department. As incendiary as this idea might sound, it has a sliver of merit. All enterprise-level organizations and even many small- and medium-sized businesses should decentralize their IT departments. IT personnel roles should be fluid, with team members spread out along the organizational chart. That said, it’s not exactly prudent to completely decentralize the IT department.

For many organizations today, the solution is to create a hybrid IT entity, one that is part-centralized and part-distributed. Wherever they may reside, IT team members should serve as guides, advisors, and facilitators rather than mere gatekeepers.

With decentralization on the rise, enterprises should consider a hybrid approach

According to our recent IT industry study, decentralization is on the rise. Almost three-quarters (74%) of IT decision-makers in the U.S. and Canada said their IT structure was decentralized to some extent. However, practically all (99%) of the study participants were wary of too much decentralization. Should their organizations opt to decentralize further, IT decision-makers foresaw problems related to maintaining IT security levels (56%), maintaining quality levels (47%), and providing reliable support (37%). Hence, many IT decision-makers believe—and I agree—that a push for a totally decentralized IT department is misguided and potentially dangerous. What I propose here is something more innovative—a hybrid approach.

Organizations with large customer-facing functions, such as in the hospitality industry, have a lot of customized needs and must adapt quickly to customer expectations. It’s important that these businesses are able to create tools quickly with the help of IT personnel. Likewise, e-commerce companies must respond rapidly to changes in the market. They, too, need the ability to roll out new technologies quickly and often. A third example is mobile-driven businesses that employ multiple micro-apps in areas like supply chain visibility, logistics, customer feedback, and issue tracking, where changes are rapid and require decentralization.

Organizational demographics also dictate how much to decentralize. All else being equal, companies with young, tech-savvy employees will likely benefit from and more easily implement a decentralized IT structure.

Now the question becomes: “To what extent should an enterprise decentralize its IT department?” It ultimately depends on the size of the company, the industry, and if the departments within the company are primarily driven by technology. Individual departments need to have the autonomy to make technology-driven decisions quickly, and they should have IT personnel available to help with this endeavor. Fast-acting sales and marketing teams shouldn’t be stuck waiting in IT queues as the market changes around them. In this decentralized landscape, IT personnel should serve as collaborators rather than gatekeepers.

Collaboration is vital, especially for low- and no-code application development

The shift to the cloud, combined with a bevy of affordable SaaS solutions and an increasingly tech-savvy workforce, has resulted in more non-IT personnel developing their own technologies. But there are constraints. All corporate solutions need to comply with company policies in areas like security and privacy. So it’s vital that there are IT personnel in the loop, functioning as collaborators, facilitators, and guides, and working to ensure that non-IT workers’ tools comply with organization-wide security and integration policies.

IT personnel may also be called upon to help train non-IT staff. According to the study mentioned above, nearly all (98%) of the surveyed IT decision-makers claim that at least one department in their organization needs more technical skills training. Marketing (52%), finance (45%), and sales (43%) departments are particularly in need of such training. These are also the departments most likely to engage in low-code and no-code app development. Hence, many of these teams are likely to misuse these tools and will need more help from a professional IT group.

IT teams are shrinking. From May 2023 to June 2023, 171,000 enterprise IT-related jobs at companies across the economy were cut. Combined with a proliferation of low-code and no-code tools, an increasing number of non-IT employees are opting to build their own tools. It’s crucial that IT personnel are involved in this process without necessarily taking it over, or the organization will suffer through shortcomings in security, privacy, and regulatory compliance.

Be careful not to over-decentralize the IT department

Let’s look at the other extreme. Over-decentralization of the IT department can lead to improper management of critical systems and redundancy in systems and implementation, as well as a lack of oversight of critical areas like compliance and security. It can also lead to confusion about the fundamental role of IT within the organization.

When companies determine how centralized they want their IT departments to be, company size, industry, and demographics all play a role in this decision.

Companies that leverage large platforms—like ERPs and CRMs—across multiple functional groups must take a less decentralized approach. Implementing and keeping these platforms up to date is complex. Implementations require training, technical knowledge, deployment expertise, risk management, and organizational change management. More centralized, specialized IT departments are best suited to handle these cases.

Ultimately, IT is everyone’s responsibility

There has been a democratization of IT tools. The majority of business decision-makers (76%) believe their non-IT employees are more knowledgeable about IT tools now than they were before the pandemic. However, these decision-makers also believe that a lack of training (48%) and basic technical knowledge (47%) are barriers to non-IT personnel’s ability to take advantage of these tools.

IT personnel are responsible for corporate policies, even as emerging technologies make this everyone’s responsibility. While they may act as gatekeepers at times to safeguard against cyberattacks and security compromises, IT staff must primarily serve as advisors and teammates.

In summary

Depending on the size, industry, and nature of the business, it may be wise to widely decentralize the IT department. All enterprise-level organizations should decentralize to retain flexibility. Businesses that operate in industries that rely on technology to react quickly to market trends will benefit from a decentralized model.

The hybrid model changes the way many view the IT department. Under this model, IT evolves from a bottlenecking gatekeeper organization into an active co-creator of technology that moves the business forward and allows all employees to use new tools in a safe and secure way.