Services orientation for delivery of IT

I went to a networking/information sharing event in Wellington yesterday.  The presenter was Myles Ward, the CTO of Inland Revenue.  He spoke about the challenges of moving the New Zealand revenue ICT department to a services approach.  It gave me pause for thought.  While it was good to hear that one of the larger IT departments in the country was moving to this model, it seems odd that it isn't more common now.  After all, this "technology" has been talked about for at least 15 years, maybe longer.  

I asked the other attendees (as a group) to comment on whether they were considering service orientation, or had already implemented it.  To my surprise virtually no-one had anything to say.

This seems bizarre.  As a group, we want ICT to move beyond the plumbing of business, being a business enabler, and even providing ways to disrupt existing models (see newspapers, music and video for the prevalent examples).  

Most C-level executives find it hard to understand and be able to articulate the value that IT delivers to their business.  And to be fair, most IT people do too.  

When you orient your IT service delivery around business outcomes, it quickly becomes obvious to the consumers of those outcomes where the value proposition lies.  Which is why it is perplexing that so few IT teams deliver services in this way.

If we want IT to be considered strategically critical for business delivery, we must be able to demonstrate value.  Service orientation is an excellent way to do this.

Nicolas Carr famously wrote that "IT doesn't matter" (HBR, 2003).  It seems to me that if you're not considering how IT delivers value to your business or enterprise, you've already accepted his proposition.

What do you think?