Streamlining Information Technology (IT) Functions and Operating Model Across Group Case Study: PT Telekomunikasi Indonesia, Tbk

Business entities are expanding their business portfolio by creating child business entities and finally building a large entity known as a Corporate Group, which is a collection of parent and subsidiary corporations that function as a single economic entity through a common source of control. The correlated business issue derives from the existence of Information Technology (IT) units in each company under the group, in which the IT functions are still conducted and maintained solely. This may lead to un-optimized resource of the assets (People, Application, Platform, and Infrastructure) and redundant IT Processes. Consequently, this phenomenon raises questions on how the most suitable IT operating model should be designed and adopted in the group among the entities. This paper is intended to design a new IT operating model, define the organizational structure and possible integration between entities, to obtain a more effective IT shared service operation model and asset optimization across the group. The research infers that the basic IT service management functions with an agile cyclic new way of working can be considered as the new IT operating model alternative, with IT service development and operation would be the most suitable process to be outsourced, rather than IT planning, design, change management, and evaluation. In addition, an IT shared service approach using a specialized federated organization structure is suggested, with an emphasis on promoting the current IT units as the single provider of specific services based on their strongest capability. As for group company, empowering the subsidiary IT units that already possess the expected capabilities and core competencies will be more beneficial and preferred than appointing a new single shared service unit for IT service.