The Great Tech Reset

Many organizations are stuck in the past, using outdated technology approaches that hold them back from unlocking the full potential of AI, cloud, and other emerging technologies.

A new book from the IBM Institute for Business Value, titled “The Great Tech Reset,” explores how organizations can rethink their tech estates and adopt a more agile, innovative, and responsive mindset.
 

From chaos to cash

Most organizations today find themselves in a "hybrid by default" mode, which means their hybrid estate has developed organically versus by intentional design. This leads to a tangled web of disparate systems, siloed data, and inefficient processes.

A hybrid-by-design approach eliminates these hindrances by creating a system of components and relationships that's greater than the sum of its parts, consequently reducing costs, improving efficiency, and increasing innovation.

To start reaping the benefits of hybrid by design, leaders should focus on the following key areas:
 

• Raise the bar with a reset. Rethink ROI and set higher targets for new tech efforts. Shift IT budgets toward solutions that can improve outcomes, such as using gen AI code-writing assistants to speed up legacy processes.
• Rebuild the foundation. Start by building the highest-impact AI products, such as critical business problems in which gen AI can yield the highest ROI. Run pilots and proofs of concept, but in areas of the business where even incremental improvements can be scaled to generate outsized returns.
• Clear a path for enterprise-scale solutions. Tackle legacy technology to remove obstacles to a new way of working and operating. Activate and modernize dormant assets to be cloud-ready and AI-ready. Use gen AI to reduce the cost and time-to-value of application modernization by helping with code translation and development.
   

ROI remedy

Improving ROI on tech investments is a critical business objective for many executives. But the average organization spends just 23% of its tech budget on efforts that actually produce business income. 

A key challenge is that many organizations manage IT as a cost center, rather than an investment portfolio. This can lead to low ROI, as it prioritizes cost savings over business outcomes. Alternatively, a hybrid-by-design approach has been shown to potentially generate over three times higher ROI over five years.

Take these recommended steps to help you achieve higher ROI on tech investments:
 

• Manage IT spend as an investment portfolio, rather than a ledger of expenses. This means focusing on strategic business objectives and the portion of all tech costs that directly support each one.
• Aim for the bullseye, which is a streamlined program that is in lockstep with the business. This requires identifying the most critical business goals and designing programs that deliver measurable results.
• Turn small wins into big ones. As you design new programs created to hit bullseye ROI, focus your portfolio on a few programs. Then manage your portfolio as a flywheel that sustains itself with “early and often” ROI that activates and modernizes existing IT assets to directly support execution. 
   

Architecting for AI agility

Improving tech architecture is critical for many executives, but the average organization's technology architecture creates confusion, conflict, and disagreement. 

One problem is that most technical architectures were not designed to serve today's very digital, very interconnected business needs. They're not as modular and composable as current architectures, so they lock users into certain ways of working, slowing down product development.

Here are a few ways to get started:
 

• Rearchitect your architecture to ensure it is fit for the future. Develop a library of patterns to help teams work faster as they create architectures that address various business aspects. This will help accelerate development by providing reusable building blocks and eliminate the temptation to build with a tech focus versus a business-outcome focus.
• Build the launchpad for gen AI. Define a complete framework of architectural principles as well as the governance required to make and enforce implementation decisions. Gen AI architecture requirements should be meshed with decisions about security, data sharing, and development platforms.
• Rebrand IT as a platform services provider. Use platform engineering to embed business-driven, intentional architectural principles and a common user experience into platform design. Design security directly into development and AI platforms to ensure that it’s integrated into every aspect of the organization.
   

Better together

Strategic partnerships, joint ventures, and collaborations with startups, developers, and industry leaders have become essential for success. However, this partnering imperative brings its own set of challenges, from intellectual property gray zones to integration complexities.

Leaders need to create a collaborative ecosystem with strong governance, open data practices, and a commitment to open standards. This can help ensure a smooth and safe ride, while collectively shaping the future of responsible generative AI innovation.

To foster an ecosystem that drives business growth and innovation:
 

• Square your tech triangle. Move from procurement to partnership, and make collaborative design the rule.
• Don't be a spectator. Make your move. Empower your corporate venturers, put out the welcome mat, and build a shared data swim lane.
• Protect the innovation lane. Institute open data practices, invite players from outside the walled garden, and replace "set it and forget it" with timely tune-ups.
   

Built for flexibility

Many enterprises today are in operating-model-by-default mode, with an average of 78 handoffs from proposal to finished product. This creates a plethora of opportunities for misunderstandings, delays, cost overruns, and other nonsense.

Here are three steps to help simplify their operating models and eliminate the friction that drags down many business operations:
 

• Hack the handover. Map the money trail, edit ruthlessly, and unleash the hackathon heroes to slash the number of handoffs within a project.
• Take a quantum leap. Use the real world as your learning laboratory, celebrate failures, and build a skills swap program to break down silos and foster a truly collaborative environment.
• Put bureaucracy and hierarchy to bed. Equip employees for decentralized decision-making, incorporate anonymous feedback into AI models, and track what no one else is tracking to ensure a culture of ownership and accountability.
   

Unlock the power of hybrid by design

Don't let outdated technology approaches hold you back. Download The Great Tech Reset book today and discover how to harness the power of AI, cloud, and other emerging technologies.

Also, subscribe now to receive complimentary reports from the IBM Institute for Business Value that will help you drive business growth, innovation, and success.