Run-Grow-Transform (RGT) Model

What is Gartner's Run, Grow, Transform (RGT) Model?

Gartner's Run, Grow, Transform (RGT) Model is a classic model of managing IT in an enterprise. This approach aligns with the way businesses have been traditionally managed and guide IT investments accordingly.[1]

Run-Grow-Transform Model

  • Run: Operate and maintain: The run part of the model indicates how much of the IT resource is focused on the everyday operation of the business. Companies call this "business as usual," "keeping the lights on" or "sustaining IT" spending. Run expenses do not directly increase revenue or achieve new company goals, but they do maintain essential functions and deliver efficiency at the appropriate quality and price for performance. As companies grow more dependent on IT, it is possible to distinguish core run operations from activities needed to grow or transform the business. These core run functions are typically associated with the continuing operation of the business and tend to be nondiscretionary or fixed expenses. Some of these essential IT activities include:
    • Infrastructure and operations
    • Security, regulatory and compliance
    • Business support
    • IT financial management
    • Application maintenance
  • Grow: Enhance and expand: The grow part of the RGT model refers to how much of the IT resource is focused on developing and enhancing IT systems in support of business growth (typically organic growth or improvements in business processes). They extend existing capabilities, deliver differentiation and provide competitiveness. Companies that want to expand their market, revenue or influence must expand their products or services. The overall business strategy is therefore focused on growth, not just maintaining existing operations. To support this business objective, CIOs must ensure that there are appropriate capabilities within IT to build on its operational foundation and enhance business opportunities for growth. This is typically reflected by increased discretionary spending for capital projects, upgrading new technologies and working with other stakeholders on improved solutions to business issues. To provide these capabilities, CIOs can focus on developing these essential grow functions:
    • Business process analysis
    • PMO/project management
    • Solution/application architecture
    • Sourcing and procurement
  • Transform: Innovate and drive: The transform aspect of the RGT model shows how much of the IT resource is aimed at implementing IT systems that enable the enterprise to enter new markets, address new customer segments, create new value propositions and enact new business models. This is a high-risk, high-reward category. As companies mature in the digital age, the expectations on IT from the enterprise will evolve significantly. Transformational companies are looking at IT to deliver innovation, create new sources of revenue, explore new markets, and develop new products and services. CIOs cannot meet these objectives by focusing only on operational or growth capabilities, but must work hand-in-hand with business leaders to ensure IT capabilities can support transformation activities. The typical transform functions that are now needed in the IT organization include:
    • Research and development
    • Capital investment management
    • Architecture review board
    • Rapid solution pilots
    • Business architecture
    • Digital solutions development[2]

See Also