OK, it’s not a competition or anything, but If you work for a startup or small company, is there any department that’s less developed than IT?
If IT is the most “neglected”, it does actually make sense from a business point of view when a company is first starting out. Temporarily, at least. For a few reasons:
- Your business systems are simple early on. You have a relatively small number of systems and they’re probably all online. Your headcount is manageable. You have no legacy systems, no technical debt, and a small (but growing) volume of data.
- IT isn’t a revenue driver. Company leadership is focused on building the business. Other, more urgent functions get more attention at first (Product, Sales, Marketing, Recruiting, Finance).
- Compliance may not be an issue yet. Security and compliance are always important, yes, but really only become business critical when you have customers.
- IT is technical. IT does a lot behind the scenes that many in the leadership team don’t necessarily know about or need to understand. Your business people are busy. Often, small companies are not even sure where IT should live on the org chart – nobody may really want IT but it has to report up to someone. In my career I’ve reported to everyone from the CEO to the COO, CFO, CTO, VP of Engineering, etc. There’s usually an informal agreement in place between Leadership and IT that basically says “you got this, right?”
- IT people tend not to be business people. It’s not just that IT is usually one of the last teams to get a “V” or a “C” leader. It’s also that IT people below the leadership level tend to be oriented toward technology and process and not toward business strategy (to make a broad generalization.)
So it’s not a problem then?
Well consider this: if internal IT is not a business driver but a business supporter, you’re going to want a proper IT framework in place as soon as is reasonably practical in your growth trajectory, so that IT will be in a position to support the business in its future state. As you scale, you want to have confidence that IT is going to be a strategic partner in your growth and not always just scrambling to catch up.
Also – spoiler alert – IT is becoming more of a business driver than it ever has been. This is partly because of evolving compliance obligations but mostly because of AI. As technology “runs” your business more and more, your business will increasingly need a coherent technology strategy.
The alternative is, your ad-hoc “startup IT” can persist well past your startup phase. Leadership can get accustomed to IT being “low visibility”, your IT processes and systems can fall further behind, and at a certain point this becomes a blocker to your growth.
Specific problems with keeping your “startup IT” into your scaling phase:
- Strategy gap – you’ll probably have no one thinking about internal IT and technology strategy as it relates to your business strategy. Technical solutions will be implemented in a fragmented, bottom-up, duplicative way that won’t scale well.
- Employee experience – your staff could suffer productivity, job satisfaction, and turnover problems.
- Expectation gap – if the organization never defines or builds a structure for what it expects from IT, this will scale poorly and you’ll end up not getting what you expect from IT.
- Project & change management – once your business starts to scale, managing change can suddenly become your biggest operational challenge. Technology will be at the center of it. Is your current IT ready to face this challenge?
- Risk and security – you’ll likely be unable to manage technology risk if you have poor visibility into your internal technology. Comprehensive, centralized information security controls don’t just happen! Someone will have to map out, oversee, implement, and track them.
This is where I mention that I can assist with all of the above! Reach out if your company is embarking on a growth phase and you need help structuring and positioning IT to support that growth.