Market dynamics are still increasing. Business and customer requirements are changing in ever-decreasing cycles. Improving efficiency and cutting costs are day to day tasks which look as if they should be established in the IT departments as processes. The competition is ready to go, ready to satisfy the growing demand for outsourcing/off-shoring. IT organizations are adjusting their role from that of regional full service providers to supra-regional or even global service managers. A vision for the future or reality now?

The demands on IT service providers are changing radically. Software updates have long since left the domain of challenging projects. From now on IT will increasingly face market-wide, global, direct competition. The locally operating, internal full service provider for monolithic IT solutions is heading for extinction. The globalization of the markets accompanied by high dynamics, the consistent demand for increases in shareholder value and the instability of company structures are forcing a change in the IT service provider’s way of thinking. It is time to act! In order to stay competitive the flexibility of IT has to be increased to satisfy the above requirements. Structures, processes and competences must thus be adapted to suit this challenge – otherwise the problems will start to take root.


Market dynamics require adaptive procedures


For IT service providers the need to be able to adapt means that their actions must be forward looking while their reactions to changing business and market conditions are fast and flexible. Internal structures and processes must be dynamically adaptable and transformable.

Four specific abilities are vital to the survival of IT organizations on their way to adaptability:


1. „Sense and Respond" ability

2. Decentralized decision-making ability

3. Transformation ability

4. Ability to collaborate


Every organization is adaptable – to some degree. The question is thus not "adaptable or not?", the important point is whether the degree of the IT organization’s adaptability is sufficient to face the challenges posed by its market and customers. This degree, which has to be a fine balance between the need for speed and flexibility on the one hand and cost pressure and efficiency increases on the other, must be identified for each individual IT organization and has to be closely linked to the company and IT strategy. Further important influencing factors when identifying the optimal degree of adaptation are the branch in question, the related market dynamics, and the company and its governance structures.
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