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The Harmonization of Sourcing, Finance and Technology: A CIO Declaration of Independence?

For reasons that have very little to do with their current roles in the acquisition and administration of information technology, the three corporate disciplines of sourcing, finance and technology frequently find themselves as adversaries or working at cross purposes.

As the information technology acquisition process changes along with IT itself, it’s time for détente. IT is just too important, too embedded, too strategic to allow internecine fighting to hinder a corporation’s access to necessary tools.

In most companies sourcing, finance and technology provide the checks and balances necessary to assure that one function does not get overly powerful, just as the three branches of our federal government rein each other in. The idea was to make sure that all technology acquisitions were wisely made, could be cost-justified, and were the best tools for the job. But to paraphrase Thomas Jefferson, whenever any form of corporate governance becomes destructive of these ends, it is the right of the CEO to alter or to abolish it, and to institute new governance, laying its foundation on such principles and organizing its powers in such form, as to him or her shall seem most likely to affect corporate safety and happiness.

I hold these truths to be self-evident: that any structure that makes people fight each other without a good reason is the wrong structure. That the three disciplines should educate each other to create a shared, blended view without losing their special expertise or perspective. That a better appreciation of each function by the others will provide a better end product. That collaboration always works better than adversarial control.

This kind of enlightened collaboration is not only desirable simply on the face of it. It is required due to the evolution and maturation of the IT function. In the “data processing” era of IT, ROIs for projects were typically off the charts. It was similar to the productivity gains achieved when a factory automated for the first time. Now that everyone has long since automated, gains are incremental, and ROIs are no longer astronomical. The three functions have to run faster to keep up, and the stress of keeping up can make them reluctant collaborators.

Technology Business Operations (TBO) – the non-applications, non-infrastructure part of a CIO’s day – is an evolving discipline that will ultimately assimilate sourcing, finance and technology functions into a synoptic view of IT tools as business productivity enablers. We’re at the beginning of this process now. As it advances, those performing the three functions need to take the long view that looks first to the life, liberty and pursuit of happiness of the corporation as a whole.

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