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Centralizing IT

By eslittles ·
I am in a division with about 3 major departments. The
executive director of these departments has proposed a re-org
with centralization of IT being a major component of this. Has
anyone here gone through this? What are some good resources
(books, websites, etc) on implementing this as best as possible?
What are your opinions of centralized vs decentralized IT?

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Reorg ....BAD

by pgm554 In reply to Centralizing IT

Basically ,they are looking to fire people and cut costs.
I have been around quite a few and it ain't pretty.

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What he said

by gralfus In reply to Reorg ....BAD

Reorgs are almost always to try to justify the position of the one doing the reorg, by "eliminating job duplication". The problem is, the way you have it set up now is probably working fine. I'd bet money that there was no investigation on the part of the manager to see if there really was bloat in the organization.

For example, we had a great setup at HP with the calculator development team sitting just across the aisle from the calculator support team. We had great interaction and quick feedback from customers to the actual engineers. It was one of the best environments I've ever been in. Of course that couldn't go unpunished.

The cuts came as the dot-com bubbles were popping all over the country. The engineering went to Singapore. Support stayed for a while as we learned that the Chinese don't like to be questioned by underlings, since it implies they didn't do their job and inform you ahead of time. Manuals were printed on paper so thin you could see through 4 pages. But it allegedly saved money. Eventually support went away also. No one knows how many millions were spent to move operations and outsource, but it allegedly saved money. We lost the top engineers to other companies, but it must have been worth it. We produced absurd interim products that didn't work. Our customer base dumped us for TI, but dammit we saved money.

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Have seen it both ways...

by NotSoChiGuy In reply to Centralizing IT

I've previously been at a mid-sized employer that decided to go ahead and bring in all the IS/IT functions into one umberlla. I am currently at a large-sized employer that still has different functions underneath relatively autonomous silos.

From being in both situations, I can tell you that whether or not centralizing IT is a positive move really depends on why it is being done. Is it the precursor to 'right-sizing' IT (hey, Bob and Joe both do the same job...why not let go Joe, and save some coin)? Is it to leverage better vendor deals and standardize the company's infrastructure? Or, is it just some guy's way to make himself look more important on the org chart by having more people underneath his little box?

At my previous employer, they had good reason/intent in centralizing It, and it really did help the firm. Here, they have good reasons not to integrate, and things are working out very well.

So, in short, I'd say it isn't so much the setup that is important, but the motive and thought behind the setup that really counts.

If you guys do decide to re-org, hope it goes well for you!

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You're so right

by paul_anthony_day In reply to Have seen it both ways...

I have been involved in several reorg's, they really do fail or succeed based on;
1. People, you need to see it from both sides of the table
2. The motive and benefits to be achieved fully expressed to the organisation
3. Pace of change, tempo makes a difference, if it is a stop/start without clear planning it just frustrates and limits buy-in and commitment
4. Communication, fear can hinder many a good reorg, it is crucial to let everyone know, why, when and how

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In my experience

by Tony Hopkinson In reply to Centralizing IT

the motives behind this are cost based, not quality. There can be improvements, but thaye are almost an accident, and there will be as many inefficiencies created as efficiencies.
Last firm I worked for that did this centralized, streamlined and then outsourced the entire thing. While this may have had some benefits, one thing that was very noticeable was the rise of DIY IT, a proliferation of internal data islands maintained by super users in order to save 'paying' the centralized IT function to do it properly.
In theory centralized IT should be more efficient and de-centralized more reactive, as far as I can see the net gain on a business level is zero minus the cost of switching, whichever way you go.

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To centralise or not to centralise....... ?

by Infrastrut In reply to Centralizing IT

Consolidation & centralisation are current trends coupled primarily to cost savings, fact. When negotiating centralisation with the 3 divisions make sure that the process is structured in such as way that they are clear and comfortable with what they should let go of and why. Gartner has some guidelines to assist with structuring the decision process. ?Consolidating IT: How to Score the Benefits and Barriers?
Losing focus is not the idea; duplicating infrastructure however is expensive, particularly in a company with no guiding standards or architecture.
Ensure that the division targeted to handle centralised IT is properly staffed, skilled and has the required tools and defined metrics to provide a measured and managed service. Lastly make sure the ?English and Money? add up, that there is indeed a return on investment.

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Centralize IT resources and Geographyically distrubute the IS

by md_usuf In reply to Centralizing IT

Centralize on your IT applications and all other functional aspects to draw the maximum (make highly available env.) out of all the available resources. (Looks like Sun is doing a great Job in this regard by providing $100 per employee kind of approach.) - Sun could be one place to look for along with the hard & soft resources.

And distribute the infrastructure geographically so that your DR plan will be in place.

-Usuf

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Good and Bad

by regalgs In reply to Centralize IT resources a ...

I have seen it done very poorly and it took years to kind of make it right - I left long before it got nearly right, so did a lot of other good people. HOWEVER, as was mentioned earlier, Sun did a great job at this. Look at www.harriskern.com - There are lots of books written by him and others to do just what they did. Harris Kern and Randy Johnson were the architects of that process. They did it right and I have learned lots of lessons from those books.

The other major issue is who is at the top of the reorganization. In the failed one that I went through the new "leader" did not want to be there but did not want to job hunt. So he took the job. Needless to say There was no help there when the problems developed. Leadership at the top is a big factor in whether or not it will succeed in the long term.

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My opinions of Centralized vs Decentralized IT?

by olapaders In reply to Centralizing IT

Actually, Centralization is better apply in any IT environment as this allow maximization of both computer and human resources. Apart from the above, security-wise it allow good and proper monitoring of users of the system, it also reduces wastages of reources while in operations.Further more, users in this environment will have no alternative than to be computer literate. while in a distributed environment, too much of resources human-wise and other-wise will be involved. Although we should not forget that in any centralized IT environment, it also involved an element of distributed processing.

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Centralized vs De-centralized

by Tony Hopkinson In reply to My opinions of Centralize ...

I worked at one place (very large) for 19 years, I left when they centralizing for the third time.

They hadn't officially de-centralized, what had happened is either they'd acquired other units with their own IT function, or units had created their own IT function to combat the biggest problem with centralized IT.

Centralized IT's justification is cost reduction, in order to achieve this without a serious impact on the service, it gets micro-managed. This makes it very slow to react to business needs.

So evey five years or so, centralized IT reels in the distriubuted functionality, absorbing duplication and providing some extra services that the business now requires.

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