ManagementSpeak: We are reallocating funds on this project.

Translation: You’d better be working on your resume.

Had this week’s contributor not remained anonymous he might have needed a good resume.

My friend Adam Hartung, author of Forbes‘ “Phoenix Principle” blog, is convinced we’re in the throes of a megatrend away from owning stuff. He’s further convinced this trend spells the end of corporate IT.

As covered in last week’s missive, this trend toward rentership is nowhere near an open-and-shut case. As correspondent Tim Harris points out, it’s a simple algorithm: If the costs of ownership (including intangibles), divided by total usage exceeds the cost of renting, rent. Otherwise don’t.

As for the death of IT:

According to The Phoenix Principle, the reason we wanted PCs in the first place was because of all the data we wanted to put on them. That data will now be in the cloud, so we don’t need PCs anymore.

This is bad history. I was there. We wanted PCs because of the programs we could run on them. That’s why we want smartphones too.

Yes, mobile devices can do some of what PCs can do. But does anyone seriously think you can replace a customer service rep’s PC and voice terminal with a smartphone?

The Phoenix Principle’s clincher: “What will a company need an IT department to do if employees use their own mobile devices, across common networks, using apps that cost a few bucks and store files on secure clouds?”

Answer: If?

We’ve seen this movie before. In the PC’s early days there were those who figured business users would soon be able to do on their PCs everything IT did on the mainframe, using cheap, simple programs without any need for IT involvement.

Another Phoenix Principle point: “If corporate technology is reduced to just operating some “core” large functions like accounting, how big — or strategic — is IT? The “T” (technology) becomes irrelevant as people focus on gathering and analyzing information. But that’s not been the historical training for IT employees.”

I agree. This entirely imaginary IT that never, for example, existed, will go away.

Unlike real IT, which runs, not “just” some “core” large functions like accounting. It runs systems that support every function in the enterprise, from supply chain to manufacturing to sales to finance and accounting to human resources to marketing. Oh, and information technology is required for every change business executives can envision, too.

It’s as strategic as things get.

So best of luck running an enterprise on apps that cost a few bucks with files stored on secure clouds. I can see JPMorgan Chase’s CFO right now, closing the year-end books with his Android edition of Quicken.

Or, for that matter, the CMO calculating some complex analytics on a petabyte Hadoop data set stored in the cloud with her ten-buck iPhone app. “Siri, which customer demographic and psychographic segments are most likely to want our new line of fashions? Rank them in order of size and willingness to buy, correlated with color and fabric preferences.”

This latest forecast of IT going away because it’s now all so easy completely misses everything IT has actually been doing all these years:

  • IT has never insisted on owning anything. IT always performs a lease/purchase analysis for hardware. As for software, IT licenses it, except when it “rents” it via a subscription. To my direct knowledge, these practices all date to the 1970s.
  • The historical training for IT employees hasn’t included information? News to me. Designing efficient data structures is at the heart of the discipline.
  • IT isn’t, at its core, about the technology. Or about information either. The heart of IT’s job is to configure and integrate … especially integrate … the multitude of applications a large enterprise needs to operate effectively. Owning vs leasing vs renting is a blip.
  • In ownership lies risk avoidance. As someone once said, those who ignore the lessons of history are doomed to repeat the seventh grade. This lesson goes back to 2000 when Pandesic, a cloud-based joint venture (back then it was called an ASP) between Intel and SAP didn’t pan out. The result: Intel and SAP shuttered it, giving its customers three whole months to make other arrangements.

IT isn’t going away any time soon. One wonders why, for so many years, so many management pundits have engaged in so much wishful thinking on the subject.

My guess: IT is expensive and hard to understand. Shipping it all offshore, into the cloud, or both means not having to worry about it anymore. Sure it does.

And if the logic required to accept this proposition is shaky, that’s okay, because the rules of confirmation bias are clear:

We only scrutinize evidence and logic that disagrees with what we want to be true.