Organizations that fail to create an effective balance between IT decentralization and control face severe security and financial implications.

A VMware survey found that 69 percent of business users and technology professionals queried believe IT management has become increasingly decentralized in the past three years. The survey, conducted by Vanson Bourne in August and September, targeted 3,300 people from 20 countries across the Americas, Asia-Pacific and Europe.

Titled “The IT Archipelago: The Decentralisation of Enterprise Technology,” the report confirmed that decentralized IT can produce big benefits for businesses, but the shift must be managed correctly. Rather than stepping back entirely, technology departments should take an active role in IT decentralization.

Disrupting Business Models

The consumerization of IT and the use of cloud computing have facilitated this decentralization. Employees find it easier than ever to purchase applications on-demand through their devices, often without permission from the chief information officer (CIO), chief information security officer (CISO) or security teams.

Business models in all sectors are being disrupted. According to Infosecurity Magazine, digital transformation is critical to enabling organizations to remain innovative, competitive and agile. The survey results suggested that decentralization can increase responsiveness to market changes, create more freedom to drive innovation and enable the quicker launch of new products and services.

It may also lead to questions about the long-term viability of the traditional technology department, however. More than half of the survey respondents agreed that decentralization has created a lack of clear accountability for IT.

Security and Financial Implications

The survey also revealed that businesses are not always ready for the transition to a new form of IT procurement — 57 percent of respondents believe decentralization leads to the purchase of unsecure IT solutions. Another 60 percent think decentralization leads to the development of applications outside corporate or government regulations, while 56 percent believe it creates a lack of regulatory compliance of data protection.

IT decentralization can also have a big financial impact. Businesses reported a 5.7 percent average increase on IT spending as a result of decentralization. Furthermore, 61 percent of technology professionals believe decentralization leads to duplication of IT spending across the organization, and 57 percent said it creates a lack of awareness of overall IT spending across the business.

Opportunities and Challenges of IT Decentralization

IT decentralization creates both opportunities and challenges. While it can empower all business units to drive innovation and ease pressure on IT, it also creates a range of management, security and compliance issues.

The survey suggested CISOs and their senior technology peers must strive to create an effective balance between decentralization and control. In Europe, for example, 60 percent of IT decision-makers believe the technology department must play an active role in the decentralization of IT to other business units.

However, IT is pushing back: In total, the survey found that 65 percent of IT professionals want IT to be more centralized. Only time will tell if these professionals change their tune thanks to the many benefits decentralization can bring.