The Future of IT Consulting

Harvard Business School has a new working paper on the future of IT consulting. The paper is only available in excerpt, but there is an interview with its authors that has some interesting comments. I found this comment from the excerpt to ring true:

As an established function, IT in the company now has more degrees of freedom to source services for highly specific purposes and value. One CIO describes the IT organization of the future as consisting of the following:
  • Business analysis to understand the needs of the businesses
  • Technical architecting to oversee and interface between IT and business systems
  • Project management to implement change consistent with the practices of the company
  • Management of IT processes
For each of these four capabilities, this CIO easily identifies the IT consulting outsiders who currently provide that service to his corporation. And, he states that his strategy aims to steadily bring more capability on the first three into his own organization. He prefers that these capabilities reside in his organization and then, by default, go to the outside if he has no alternative.

This is completely consistent with what I say in my paper on the modular IT organization. The first three of these fall within what I call the "value innovation" function. The actual management of the IT processes is what I put in the "service provisioning" and "solutions delivery" areas. I also agree that we should keep the expertise inside the IT organization and use consultants for staff augmentation (i.e. I need three more programmers to complete this project, but my organization manages the project) and expertise that's too expensive to keep on staff full-time (i.e. many small and medium sized organizations probably can't keep security experts on staff).