The complexity of IT environments has grown to the point that traditional operating models no longer meet changing business requirements. The solution lies in a new kind of customer-centric lifecycle model that helps reduce technical debt, complexity, and costs. Digia's SVP Janne Tuominen believes that such an operating model will soon be taken for granted.
"In many organizations, managing the digital landscape is becoming increasingly difficult. The world has already seen problems related to this," says Janne Tuominen, Senior Vice President, Managed Solutions at Digia.
The reason for this situation is that IT environments have constantly expanded and become very complex. Artificial intelligence raises the challenges to a new level, and traditional ways to manage this complexity are increasingly insufficient.
"The old ways of working no longer work. IT environments are forced to move to a new kind of operating model, which is still developing," Tuominen says.
The new lifecycle model focuses on the management of larger entities, and responsibility is also transferred to IT suppliers.
The challenges are not due to the wrong things being done. It is more a matter of natural development, as organizations' operations have been digitized. Numerous core systems have been introduced, such as ERP and CRM, cloud services, and SaaS software. The business has also expanded into digital channels, and all of this has several different suppliers.
"One customer told me that they have about 140 systems in use. Old systems should be run down, but that would require a huge amount of work for which there is no money."
Tuominen says that in many organizations, CIOs are now considering three questions.
How much complexity and technical debt has accumulated in the environment?
How many systems are really needed?
And who is responsible for the long-term development of the whole?
"One CIO told me that they have 14 strategically critical IT transformation projects underway. He said that no new ones can be taken until the old ones are completed."
”At worst, complexity takes away the entire productivity benefit of AI."
"AI will take the current challenges to a new level. Various AI agents are introduced into the systems, and new functions can be quickly implemented with vibe coding. AI does not reduce complexity, but increases it," says Tuominen.
On the other hand, the use of artificial intelligence is critically important for companies. However, in a fragmented and complex environment, it is difficult to reap the benefits.
"If an organization has ten core systems, different digital channels, and several CRM systems, can customer data be collected in one place? If this is not possible, how can AI agents be introduced, for example, to help with customer work? At worst, complexity takes away the entire productivity benefit of artificial intelligence," Tuominen says.
Cost pressures do not allow for a large increase in resources. That is why a new approach is needed.
The solution to the current problems is to shift from a mindset that emphasizes projects and services to one that emphasizes managing larger entities. It is also necessary to transfer responsibility for this to IT suppliers.
"The level of abstraction cannot be only the expertise of experts, a single project, or even managed services. It should be the IT entity and its life cycle, and suppliers must take responsibility for its functionality in the long term."
Digia uses a customer-centric lifecycle model divided into six areas (Figure 1). It helps to:
direct development investments to the right things,
reduce technical debt and
take care of regulatory requirements, for example.
The aim is to use the lifecycle model to move from fragmented service management to comprehensive management of the entire digital base.
”The leap in productivity of AI is very realistic. It frees up people's time, allowing them to focus on developing the IT as a whole.”
While AI brings new challenges, it also plays a key role in solving them.
"AI can significantly improve the efficiency of service production and the development of new things. The productivity leap is very realistic. This, in turn, frees up people's time, allowing them to focus on developing the big picture," says Tuominen.
Digia does not introduce AI as a point-to-point solution. Instead, it aims to redesign delivery processes so that AI delivers the greatest benefit.
The comprehensive development of IT in accordance with the lifecycle model and the advent of AI require changes in some practical arrangements. For example, pricing models and service level agreements must be reconsidered.
"It is clear that suppliers need to have more lifecycle responsibility. If you just do the project and leave the scene, you may not care about the number of errors. But if the supplier is responsible for the system's lifecycle for the next five years, then the number of errors is of great interest," Tuominen says.
Invoicing and SLAs should be changed so that the supplier is rewarded not only for work but also for meeting goals – for example, quality, long-term functionality and increased automation. In this way, both the customer and the supplier benefit as operations become more efficient.
"I believe that in three years' time, this new kind of model will be taken for granted."
"Almost every CIO I've talked to has said that their organizations have been thinking about the same things lately. They also think that AI, in particular, will change IT development work significantly."
Tuominen estimates that there will be a widespread transition to new types of models, perhaps in the next two or three years. However, several customers are already planning to acquire services under the new model this year.
"We are now making a structural change in the IT industry. In summary, it is a new operating model that allows for better focus on managing complexity. I believe that in three years' time, this will be taken for granted, and that is why we have built a ready service model in which the IT environment is managed as a whole and not as separate projects and services," Tuominen adds.
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