One hears it all the time. Trade press headlines tell us that IT has lost its way and is no longer relevant. Some even say that IT doesn't matter anymore.

The reason? Users are unsure that they are getting what they need from IT. Senior business managers don't understand why IT costs so much. IT's trusted vendors (telecommunications, ERP, BI providers, etc.) are successfully going over IT's head and selling directly to senior business management. And everybody is bandying about the two "O" words, outsourcing and offshoring.

And the CIO? Well, some think that the CIO would be wise to get his or her resume spiffed up. Is it really this bad? Is IT's obituary being written?

Actually, IT is not as much doomed as it is confused. The fundamental problem is not with IT's current status or even its future, but with its mission. The main problem: IT sells technology, but users buy service. Until IT understands this, it will remain in economic harm's way.

Any business worth its salt knows and understands its core competencies, what it does better for its customers (users) than anyone else. What is IT's core competency? What does IT do that users cannot buy better and/or cheaper elsewhere? Network support? Probably not. Data centre management? Sorry. Help desk? Afraid not. Deskside support? You're kidding, right? In most every case, some outside organisation can do what IT does better and possibly cheaper. Which raises the awkward question: Why do we need IT?

Thankfully, for most organisations, there is one area where outside parties cannot compete with IT. One skill where the systems integrators, consultants, and hardware, software and network vendors come up short.

That is IT's knowledge of the people in the business, how they work, and how to successfully use technology to support their efforts. IT's core competency is helping its customers (users) employ technology in the pursuit of common corporate goals. The reality is that IT is not a technology organisation, but a service organisation.

Intimate knowledge of your company, its culture, products and people, and how they work to create corporate value are competencies that IT's suppliers would love to have. With them, they would be able to successfully cut IT out of the entire value chain. If IT tries to compete on its suppliers' playing field, it will lose. But if, instead, IT insists on competing based on its core competencies, it can easily win.

How well does the average IT organisation exploit this advantage? Not well. If you look at IT's strategy, its budgets and its hiring, training and appraisal programs, you will see that there is little emphasis on exploiting IT's core competencies and millions of dollars spent on competing with computer manufacturers, network providers and software vendors.

IT will always be on the existential precipice as long as it ignores its true organisational purpose and fails to focus on the real reason the business needs an IT organisation.

George Tillmann is a former CIO, management consultant, and the author of The Business-Oriented CIO (John Wiley & Sons, 2008).