With increasing disruptions to traditional business models and the rapid adoption of exponential technologies such as Web 3.0, the metaverse and 5G, enterprises need a new technology strategy to compete in the market.
The role of an IT team is no longer as “simple” as keeping the infrastructure running efficiently; today, IT organisations also are charged with driving business growth, change and innovation and meeting sustainability targets.
The Everest Group suggests that to be able to innovate and differentiate at enterprise speed and scale, IT organisations must adopt Systems of Growth thinking.
What is a Systems of Growth thinking?
Systems of Growth thinking is when both enterprise and IT leadership view the role and scope of the IT organisation as a vehicle to fuel, manage and/or respond to disruption at enterprise scale and speed.
An IT organisation that adopts Systems of Growth thinking strives not only for operational efficiency but also to contribute directly to business growth. Within a System of Growth, IT doesn’t just run applications; it manages platforms.
An IT System of Growth doesn’t merely “own” the infrastructure, it orchestrates it. An IT System of Growth focuses on being a revenue enabler rather than a cost centre.
“As organisations across industries claim to be technology firms, CIO and IT leaders are getting a seat at the table to shape the organisation’s growth strategy,” said Ronak Doshi, partner at Everest Group.
He posits that a platform-based operating model that measures the platform for its growth and experience outcomes is at the centre of the Systems of Growth thinking.
“Traditional enterprise budgeting methods look at IT spend as a percentage of revenue to account for upkeep and maintenance of systems, and this leads to a constant struggle to find budgets for change initiatives,” said Nitish Mittal, partner at Everest Group.
“An organisation with a Systems of Growth mindset looks at IT spend as a lead indicator for future growth, and its IT funding model is based on growth and experience return on investments.”
Nitish Mittal
Chirajeet Sengupta, a partner at Everest Group, says IT organisations struggle with legacy applications and siloed systems. “Systems of Growth thinking helps them break enterprise silos and use the power of hybrid cloud infrastructure, the enterprise data lake and AI/ML to orchestrate platforms that drive revenue expansion,” he continued.
Why is a Systems of Growth mindset critical today?
With increasing disruptions to traditional business models and the rapid adoption of exponential technologies such as Web 3.0, the metaverse and 5G, enterprises need a new technology strategy to compete in the market. Systems of Growth strategies are vehicles to fuel, manage and/or respond to disruption at enterprise scale and speed.
To remain competitive, enterprises using Systems of Growth thinking will:
Track and respond to the technological disruption that is happening both inside and outside their defined industry boundaries. (Most disruption elements permeate industry boundaries.)
Balance their “change versus run” priorities.
Enable collaboration with a broad set of ecosystem participants, which could be internal and/or external to the enterprise. In fact, most use cases will be inter-enterprise and/or inter-industry implementations, with a few contained intra-enterprise use cases serving as the exception.
Adopt a platform-based operating model to orchestrate technology and the ecosystem. This model is designed with software at the centre and services wrapped around it to deliver each transaction.
Systems of Growth thinking will result in product, channel and business model innovation appropriately shaped by the nature, scale and complexity of disruptions.
