3. IT needs a new operating model
Plan-build-run model is no longer viable: Leaders attending the CEB Summit also considered changes to IT’s operating model for the digital era. Digitization leaders believe that the default operating model of plan-build-run is too linear, slow and inflexible. Instead, many CIOs have established new models designed for iterative development, continuous delivery, minimum viable products and rapid changes in priorities.
Product-line management defined by business outcome, not technology: A key difference between these new models and the current plan-build-run approach is a move to product-line management. The product lines (which some attendees refer to as services, experiences or value streams) are aligned by business capability or outcome, not technology.
IT funding is allocated to each product line: The way IT budgets are allocated is also different. Instead of funding projects, companies allocate money to each product line depending on its strategic importance and give product managers flexibility to use the money to fund enhancements to their product lines through the year. In doing so, each product line can move at its own pace. Top-priority product lines can use Agile and DevOps techniques to introduce innovations rapidly while commodity product lines can be managed rigorously for efficiency and stability.