Analyst Report: The new enterprise operating model

Analysis

The reconciliation of IT and business has been a persistent theme over the past 10 years, and for good reasons. At a certain point in time, the IT department constrained enterprise behavior, and senior-level management widely regarded it as a cost, and even as a hindrance.

But what happens to the enterprise when the IT-to-business reconnect is complete? This report argues that modern IT — that is, one that is cloud-based, platform-centric, and often making use of extensive partner ecosystems — allows companies to free themselves from old enterprise constraints. However, business management and IT organizations must address ensuing conceptual and business model issues:

  • What we have come to define as a “technology platform” is changing. The classic API-and-services concept needs to be extended. IT is developing a far better understanding of the unique contribution of the strategic role of connector technologies (APIs, RSS, identity and billing systems) that create a platform for business connections.
  • That business platform, often described as an ecosystem with the API supplier as “dominant species,” is morphing into something better described as a “federated organization” that gives us access to many new ideas about rapid business formation.
  • Businesses that embrace modern IT create a new enterprise operating model (NeoM) that supports emerging business models and revenue options. They can also apply NeoM principals internally: In the case of pioneer companies like Netflix, for example, this means getting rid of departmental barriers by focusing team activity on internal platforms and teams.

Table of Contents

  1. Summary
  2. Redefining the business platform
  3. Running the business via NeoM
  4. Outlook and key takeaways
  5. About Haydn Shaughnessy
  6. About Gigaom Research

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