Being a CIO today involves balance. The need to balance “keeping the lights on” while introducing new technologies.
Integrating those new technologies to allow data to flow seamlessly without anything falling over. Embracing opportunity while reducing risk. And balancing budgets as the IT department shifts from Cap-Ex to Op-Ex, steering the transition from IT as a cost centre, to IT as a value centre.
In this blog, I’ll take a look at the challenges facing CIOs, and possible responses to those challenges. Some of these were clearly articulated by our guests at March’s Future of the IT Department in the age of Cloud and Digital Transformation discussion. We were joined by ex Britvic CIO and visiting professor at Birmingham City University, Rob Pritchard, Nick Skelsey, IT Director Europe, Harding Retail and Liberty Global/Virgin Media’s Director of Performance and Metrics, Nick Good. Nick, Rob and Nick described a number of challenges faced or were anticipating, including internal reorganisation, dealing with legacy systems, leading innovation, integration, and disruptive competition.
It’s clear the role of IT in business is changing – to a great extent driven by ever increasing demands from customers, who expect a seamless interaction with business through many different channels. Introducing those channels and linking them together, along with any legacy systems in place, is a major undertaking, and the CIO is under pressure not only to do it right but do it quickly as well. This can be done, of course. Recently, we worked with Costa on a major digital transformation programme. We helped them introduce a Cloud based integration platform to enable different channels and technologies come together to provide a consistent business process. Costa introduced 106 APIs in just three months, which would usually have taken significantly longer, so it’s clear integration can be done at pace and done well too.
The challenge from disruptors is one that can’t be ignored. Millions of words have been written about the impact of Amazon, Uber, Spotify and the like, and thousands of other challenger companies are having similar effects across all areas of business. Even higher education isn’t immune: Rob Prichard mentioned the new Higher Education and Research Bill which will allow the set up of new universities. As with any start up, they’ll have the advantage of establishing their business model from scratch, using the latest technologies to build their offering, without any encumbrance from legacy technology or culture.
Other challenges, such as internal reorganisation or a merger or acquisition may also occur. Nick Good, for example, explained how Liberty Global’s nine separate regionally based European IT functions are being reorganised into one new IT department. Initially, this involved organisational change but ultimately, this will also be from a technical platform perspective as well. And of course, this change must be effected while continuing to balance the ongoing support of business growth. Mergers and Acquisitions also need careful attention: there is much to consider. For example, when major online tri-sports retailer Wiggle merged with Chain Reaction, Searchlight’s CEO, Steve Sharp, and Enterprise Architect, David Gray, used our own unique detailed methodology to analyse the companies’ tech landscape, conduct a rigorous risk assessment, evaluate human resources, budget the IT aspect of the merger and advise on how the two businesses could best work together in the future.
All these challenges call for the need for the IT department to play a greater role in business strategy as a whole. The CIO needs to understand how IT can make the business organisation faster, smarter and more responsive, and that means being able to scan and plan on three different levels.
- The Horizon Scan – Thinking ahead of current strategy, look at markets (and not just your own) innovations, disruptors, even social trends to get a wide ranging, clear picture of what the next few years might bring.
- Business Capability Planning – a more medium term view of your business capabilities and how to upgrade them – that means looking at how processes, people, information and technology need to work together .
- Immediate responses – using agile techniques and DevOps principles to deliver rapid change of current environments – both in terms of changes themselves, but also having your organisation and governance processes set up to deliver incrementally and rapidly.
In order to make such long, medium and short term responses, the CIO needs to enhance or develop a skill set that embraces business leadership as well as tech know-how. We’ll take a look at leadership skills for the CIO in our next blog.
In the meantime, if you’d like to explore more of our discussion with Nick, Nick and Rob on the Impact of Cloud and Digital on the Future of the IT Organisation, please click here for the webinar recording.