Startup lessons for traditional IT shops

Fast-growing companies like Square and MongoDB are driving IT innovation with leaner staffs, cloud-first computing, self-service everything and CTOs rather than CIOs.

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As a high-tech startup, MongoDB gave no real thought to IT as it was getting off the ground.

Laptops were purchased on an as-needed basis by individual employees and expensed alongside printer paper and working lunches. Free cloud applications like Google Apps and Dropbox were the go-to productivity tools, and engineers coding the NoSQL database were certainly tech-savvy enough to spin up servers and troubleshoot problems on their own.

Yet as the company launched into hypergrowth mode, ballooning from four people in 2009 to 330 employees in a stretch of four years, MongoDB had to adjust how it handled IT. The tipping point came in 2012 when the firm hit about 70 employees, many of whom weren't developers.

"From an IT perspective, anything works with two people because the requirements are so sparse," says Eliot Horowitz, MongoDB's CTO and a co-founder. "Engineers generally want as little configuration, security and day-to-day support as possible. Scaling the IT organisation had to happen when we started to support non-technical people."

MongoDB has formalised security standards and procurement policies and brought on a handful of full-time IT workers, yet its vision of IT is still a far cry from most traditional organisations. Like many newbie companies building an IT infrastructure from scratch, there's a shift away from on-premises enterprise applications to software-as-a-service (SaaS) tools and an emphasis on self-service, the goal being to empower business users and reduce the administrative and support burden on IT.

There is also a push for smaller, flatter IT organisations with more integration into the line of business. Instead of staffing up a dedicated department with dozens of network specialists, support staffers and business analysts, companies are relying on a core IT crew working in concert with business leaders and key outsourcing partners to build out and manage IT operations. Many are also folding IT into the domain of the CTO or chief operating officer as opposed to appointing a dedicated CIO.

For enterprises, two-speed IT

There's no question that companies building out a ground-floor IT operation have far greater latitude to experiment with new IT models since they are unencumbered by the baggage of legacy systems and cultural inertia, experts say.

Traditional IT shops have a lot to learn from the experiences of their much younger and more nubile counterparts. By applying some of the new deployment and organisational concepts, established IT groups can drive more innovation, particularly in the area of the front office, which has yet to be transformed by technology initiatives on the same level as back-office operations, notes Leigh McMullen, research vice president at Gartner.

For organisations that have left their startup days far behind, McMullen recommends "two-speed IT" -- where traditional IT organisations are augmented with a subgroup charged with pursuing "mission-enhancement" projects. Many of those projects are created for the front office, which Gartner defines as "the revenue or value-creating segment of the enterprise" -- think product development, marketing or sales.

To get a three-person, three-week project approved inside a traditional IT organisation takes longer than three weeks. Leigh McMullen, Gartner

Here, IT needs to play by a totally different set of rules, McMullen says, applying a startup mentality to establish lean teams and new development models. "This is a very different organisation that employs different funding and governance models and operates at a different tempo," he explains.

"The things that are going to help the front office are typically smaller, not the big monolithic ERP system" -- and IT typically doesn't have the ability to do little things, McMullen says. "To get a three-person, three-week project approved inside a traditional IT organisation takes longer than three weeks. It's just not built to do that."

What else can enterprises learn from the young guns just now entering IT adolescence? Read on for ideas to steal from rising stars MongoDB, Square, Plum Organics and Alex and Ani.

Idea No. 1: SaaS speeds delivery

One near-universal way startups are injecting agility into their IT infrastructure is by ditching the monolithic enterprise application in favor of SaaS models, whether it's for back-office functions like order processing or front-office tasks like collaboration and brainstorming. Rather than building out a technology stack with discrete systems like ERP or CRM, today's startup firms are more focused on delivering cloud-based business capabilities that serve a particular purpose -- for example, to help salespeople track leads or to facilitate collaboration among global team members.

"It's not just a cloud-first strategy, it's a capability strategy rather than an application focus," McMullen says. "Instead of procuring the best technology to deliver everything they need at once, they are focused on delivering what's good enough to get the mission done today. They are not hung up on the conventions of picking a platform and sticking to it."

We try to keep everything hosted and scalable as much as possible. Eliot Horowitz, MongoDB

While readily available cloud-based tools like Google Apps and Dropbox were the underpinnings of MongoDB's IT infrastructure, the firm stuck to the SaaS model as it branched out to enterprise functionality, Horowitz says. For example, the team uses Salesforce.com for CRM and is leveraging Cisco's Meraki cloud-based, managed Wi-Fi system to bring connectivity to its remote offices without having to staff up IT.

While Horowitz had initial concerns about the scalability of early SaaS tools, he says things have stabilised in the past five years and any risk associated with the cloud delivery model has dissipated. "We try to keep everything hosted and scalable as much as possible," he explains.

Under Horowitz's direction, the three-person IT team, in tandem with senior business leaders, created standard use and security policies. That allows business users to tap other SaaS tools at their discretion as long as they comply with the overall IT policies, Horowitz says.

"SaaS has been key in keeping our IT organisation small," he explains. "IT has become more of a policy center, and business teams manage their own deployments. It keeps things moving faster and is far more efficient."

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