Wednesday, April 3, 2013

INFORMATION-Driven IT is a Strategic Shift

A CIO can't just sit back and apply yesterday’s techniques to today's problems.

The tension between 'business' and IT has been around forever, but instead of getting better, it has gotten worse in the last couple of years. The reason is that digital has become ’normality,’ and almost everyone now feels at ease with digital technology. In other words, the natural knowledge advantage of the IT department has eroded. So what’s IT's digital advantage? How to shift IT focus from "T" - technology driven to "I" focus, and how to run a high-effective and high performance digital IT?


1.The Capitalization Problem

During the "glory years" when technology was exploding, leverage and capitalize it was more specialized and centralized, IT get lulled to sleep in the "T." Now that "T" has been demystified and become more cost-efficient and transparent and is aggressively sought after and embraced by business, it seems the value proposition of IT has devolved. However, there is plenty of value to be put in the "I" side, IT must be at the crest of conveying the difference between "data" and "information" and of creating, deploying and institutionalizing strategies and solutions for managing them.   

So does IT have a capitalization problem? When writing the abbreviation of "IT" but with industrial speed, it often means "iT." IT spends too much time talking about and trying to justify the "T" when "T" is only driven by "I." Business leaders understand the need for "I" and justifying "I" projects is not nearly as difficult. Should IT be written  as "It" where "I" takes precedence and "T" simply empowers it? The need for information has been around for a long time. Technology makes it faster, cheaper, and potentially more accurate. Do you (we) understand the information in our organizations or do we spend so much time trying to keep up with technology that we use that as an excuse to really understand "I.", "iT" might be seen as useless but "It" is powerful?

On the "T" side, IT must begin to drive home the point that everything on the buffet isn't good for you just because it's easy to get and it tastes good at the time. The ease of acquiring technology creates two potentially large threats to the (corporate) organization:

(1) Limited data integration across the enterprise results in localized visibility and heightens dueling reports, metrics, and indicators across functions and departments;

(2) Data security concerns due to dependence on cloud technologies without continuity and ownership contracting, monitoring and control at the enterprise level. The "I" discussion amplifies both "T" risks and demands greater and more persistent IT engagement even when procurement-driven operating paradigms would perhaps indicate the opposite.


2.  IT as DECISIONEERING & SOLUTIONEERING

In the end, the IT low maturity stems from the prevalent cultural norm that accepts IT as a tactical function, but not as a strategic partner. Until this changes, IT will be stuck in the struggle between "big bang" initiatives that take multiple years, huge budgets and rarely deliver as promised and "no bang" tasks that are mundane, misunderstood and underappreciated (if appreciated at all) by most of the organization. So what’re IT value proposition:

  • Decisioneering: Coining up with new lexicons like "Big Data" is not enough. IT must embrace a responsibility to engineer best practice decision paths, “decisioneering" if you will. This demands a disciplined, process-based approach not only to data and information but also a deep understanding of the decisions that need to be made and their impact. IT must design information strategies around decisions. 
  • Information Governance: IT plays a significant role in governance discipline, which is extremely crucial in today's digital dynamic with "shadow IT" phenomenon, as for long run, GRC will directly impact business's bottom line keep: the light on and top-line business growth. The centralized IT can oversight key business processes, and govern information with effectiveness & efficiency. 
  •  IT has to get more involved in the business as Solutioneering: IT needs to engage with the business units to find out how the department is perceived, what the pain points are and to identify opportunities for developing new services or improving/optimizing current ones. Too often, IT managers are happy to let their departments stay in that role. They can provide infrastructure or software without having to get involved in the business. These departments will always be viewed as cost centers. IT managers who become territorial over the department only compound the problem.  

3. CIOs as Business Leaders

In many companies, the person assuming the position of the CIO was rarely seen as the chief 'Information' Officer. People mostly perceived him as “Top Dog of the Nerd Herd and Boss of all things Bits and Bytes.”Thus, fundamentally, it boils down to whether the CIO perceive himself/herself as a business leader or leader of the IT function within the organization. This is then reflected in the communication between the CIO and other executives within the organization. If the CIO is myopically focused on IT and the cost of IT, then the IT function is viewed as a cost center, a necessary evil in achieving top line, but has negative bottom line impact. 

  • Focuses on the INFORMATION aspect of the role in the context of the business is part of the makeup of the person per se: The CIO has a role in selling the merits of IT to the business and quantifying projects in terms of ROI, also the board within the organization must support the CIO and seek to understand the importance of the services IT provides and future initiatives delivered with measured ROIs to the business. 
  • Building executive peer relationships is a key responsibility of a CIO and other CXOs: Communications at the CXO level would eliminate many delayed or missed business opportunities and solutions.  These peer relationships offer opportunities where business needs a surface, where business solutions emerge, and where true executive partnerships implement solutions that serve the business with IT value. These executive peer relationships bring problems with solutions to the board where no one CXO stands alone to fight for approval to proceed.  
  • CIOs that are successfully showing how much money IT can save and how much it can make) are the ones that get true buy-in and commitment from the board: So, in today's environment, how many CIOs are looking at the current regulatory environment, and seeking out ideas to help address these challenges? How many CIOs are looking at key elements within their businesses value chain to identify merger and acquisition opportunities that can leverage IT synergies to reduce cost and increase market share?  
  • CIOs as Chief Complexity Officer - keep it simple "up top": Manage the detail at the bottom, with a curious mix of "transparency" but just enough to inform without "boring" others. The CIO also needs to work with the other senior leaders to develop a vision for IT that fits with or is a key component of, the firm's strategy. If the CIO can accomplish these things, he/she can position IT as a strategic partner in the organization and turn it into something more than a cost center. 
A CIO can't just sit back and apply yesterday’s techniques to today's problems, the key is engagement with the business. IT gets "blinded by the beauty of technology gadgets" and push the tech because it is self-evidently worthwhile - without bothering to correlate it to the value it might actually provide the business. A good CIO needs to shift her/his perspective from what it probably was throughout her/his career and see things from the business point of view, from “T”-driven to “I”- focused. It's hard, but you need to cease to be an advocate of the engineers and start making the engineers prove their value every day. 

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