The IT department as we know it, will no longer exist after 2012. Not only will there be a radical shift in skill sets but the traditional IT shop is likely to have a different name with IT managers even sporting new titles like innovation manager or director of processes.
In the next five years, the IT department will shrink by one third as a result of increased automation, according to John Roberts, Gartner vice president and distinguished analyst.
But it isn't just about size, Roberts said this transition will see IT's focus shift dramatically from technology to business processes and relationships.
"By 2010, 50 percent of IT organizations will refocus on brokering services and shaping business demand, rather than delivering IT services directly. This is up from five percent in 2004," he said.
"By 2012, at least 50 percent of large IT organizations will divide into at least two parts with one focused on technology sourcing and delivery while the other will focus on architecture and change."
Providing examples, Roberts said one piece of the split is technology where staff are involved in simply keeping the lights on and providing desktop support.
The other piece of the IT organization will focus on business outcomes.
"By 2010, at least 50 percent of new outsourcing deals will use measures based on business outcomes not IT service levels," he said.
"As a commodity the technology piece requires a lower level of skills. We have gone from building apps inhouse to buying it off the shelf through to software as a service.
"Staff numbers are dropping with server consolidation, virtualization and automation. These are the workers that press the reset buttom and are tasked with rescheduling."
As organizations grapple with information overload, Roberts said there is a new focus on business processes.
"There is a lot of data but its not in the data warehouse. It is no longer about knowledge worker management, we have moved to the high performance workplace which is about having the right information at the right time," he said.
"I met a guy the other day who was the manager of process and innovation. It signals to the business that technology is a commodity and that his department is focused on improving processes.
"CIOs are becoming the owners of the most critical transactional processes, which we see in banking, while business focuses on marketing and winning customers."
Roberts said in the next 18 months CIOs need to chose the main value focus of their department and rename it.
He said CIOs should not dwell on the existing IT organizational chart and boundaries as they need to create an environment where business and technology can be fused to deliver real competitive advantage.