From Products and Service to IT solutions: Nine Principles for Managing IT Solutions

Many organizations have transformed their business models from offering single products or service to providing IT solutions. IT solutions comprise hardware, software, and service components and are designed to solve a specific customer problem. Transforming to the IT solution business model, however, is often underestimated as it entails various challenges and risks: First, IT solution providers need to prepare for future customer engagements by building up or integrating personnel resources as well as platforms bundling software and hardware components. Second, IT solutions are highly customer-specific and providers need to interact with the customer during the entire solution lifecycle, including the design and operation of the IT solution. Third, the IT solution business model presents new risks such as operation, integration, and customer risks for providers. Building on a multiple case study with a medium-sized IT solution provider, we derive nine principles for managing IT solutions from a provider's perspective. The nine principles should be useful for CIOs and strategy-decision makers transforming their organization to IT solution providers.