Gartner recently laid out the CIO agenda for 2014 and beyond. In this piece, Gartner posits that all industries in all geographies are being radically reshaped by digital disruption — a “digital dragon” that is potentially very powerful if tamed but a destructive force if not.  

It’s a CIO’s dream come true, and also a career-changing leadership challenge.

The Third Era of IT

Y2K and the dot-com bust brought the first “mad inventor” era of enterprise IT to a close. What followed was the second “industrialization” era of processes, services, standards, and smart sourcing.  

Today, CIOs face new challenges in the form of a third era of IT.

Caption: Image from 2014 Gartner CIO Agenda Report

The third era of IT is about moving from a view of the business as a customer that has its own external customers , to viewing the business as a partner, working together to serve the external customers of the larger business.  In the old model, IT was insulated from market changes by a layer of abstraction in the form of the business unit.  The business unit was responding to changes in the market, which usually did not require rapid changes to IT. 

But now, market changes are being driven by rapid digitalization Consequently, it’s not possible for the business unit to respond to those market changes without involving IT.  With the consumerization of IT, if IT continues to respond at their usual “second era” pace, the business unit has no choice – and no impediment – but to look for outside technology suppliers that are more agile. 

The downside? Loss of corporate control of technology leads to unbridled spending and outsized business risk due to weak security and compliance controls.  

So what should IT do?  That’s where the third era of IT comes in. IT needs to view itself as a partner, not a supplier to the business. 

The Dragon in the Third Era of IT

To harness digital opportunities and ensure that core IT services are ready, CIOs must strive for clear digital leadership, strategy and governance; and help build a digital-savvy C-suite.

The “digital dragon” presents both opportunities and challenges for CIOs. To tame this dragon, IT leaders must exploit deep innovation that goes beyond “second era” process optimization.   They need to deliver business-integrated IT innovation at a much faster, more agile pace.  

CIOs must orient themselves to business models, treat business peers as partners, and focus on external customers. And to lead digital business innovation and deliver new types of value in the third era of IT, modern IT leaders need the right management system.  

Technology Business Management as the Dragon Slayer

Technology Business Management (TBM) is the Modern CIOs business management system of choice . Gartner’s recommendations are remarkably consistent with the philosophy underlying TBM – a discipline focused on greater alignment between the technology and business priorities. 

Modern CIOs use TBM to effectively manage their business of IT through an integrated view of technology cost, performance, supply, and demand. CIOs across the world, in the most innovative companies from Cisco to Micron, are relying on TBM as enterprise IT enters the third era of digitization.  

Interested in learning more about TBM? Download this white paper now . We’d also love to see you at the second annual TBM Conference being held at the Fontainebleau Miami Beach on October 28-30, 2014.