Sunday, May 22, 2016

“CIO Master” Book Tuning XXXVII: How to Understand the “Three Sides of Coin”

The three sides of coin is: business, IT, and interaction & integration of both.

Forward-looking organizations empower their CIOs to lead digital transformation because IT is at a unique position to oversight business process and becomes a critical component in building business capabilities. Most of the senior CIOs understand that the digital transformation of most of the organizations depends, to a large extent, on their capabilities to transform their duty from an inside-out focus into an outside-in focus. They must not just understand both sides: IT and business, but also focus on the third side: How can IT interact with both internal customers and end customers, and how can IT and business integrated into a “whole” to ensure that the holistic business is superior to the sum of pieces?

CIOs are Business Executive first, and IT managers the second: They must devote their time and energy, understand the business and the potential of digital technologies to improve customer experiences, improve business processes and work with senior executives to develop new digital enabled business models. This should be the focus of the digital CIO. Today’s organizations are at a crossroads where the segregation or siloing of business units are at a need to reach across the aisles and respectively work with each other. IT "glues" the silos and delivers the best solution to the business problems which meet business’s requirement or tailor customer’s needs. IT should facilitate the business partners to the right solutions and help to implement them. Therefore, CIOs need to also collect feedback from business upon how to improve IT services and satisfy customers.

Bridging the gap between IT and the Business are really issues of all about change: Some say, that the gap between business and IT has actually widened. The reason is that business and IT have evolved at a different pace over the past few decades. While IT has evolved significantly in all aspects - people, process, technology - business has, and continues to evolve faster. The world has changed and operational process efficiency needs to be on agenda to see economic prosperity return for future generations. Cutting out waste such as shrinking the gap between business and IT as described could make a significant contribution and the sooner it starts the better it will be for all involved. If there is a conflict inherent in serving both individual business functions and the enterprise as a whole, as a rationalization in many cases serves the enterprise at the cost of specific functions. What has to be realized is that sometimes the additional cost to the enterprise is worth it. That's a business call and it precludes an inflexible strategy on the part of functional executives. In this case, CIOs need to capture the full picture, the holistic business insight, rather than IT picture only.

The business needs to learn IT, just like IT needs to understand the business: Often, business still does not wish to learn about technology, operate it or deal with the IT department. Nevertheless, technology intricacies are increasingly hidden by smart interfaces that make possible for its direct operation and management by business people, avoiding as such as the IT department involvement. The CIO should educate other business functions with data that business as whole is superior to the sum of pieces. The CIO can also provide valuable insight in the form of cost saved, revenue from new unexplored business idea etc., Selling IT process improvements is relatively easy only when it is within the CIO's own budget authority. Once you cross that line, it is not easy and it shouldn’t be. Therefore, the “third side of the coin,” IT and business communication, collaboration, and integration becomes more strategic than ever.

It is increasingly more challenging for IT to deliver to business what it wants when it wants. The real paradox is that IT depends on the business to define their technology requirements but the business does not understand the capabilities of technology and it is difficult for them to provide functional requirements for applications. Therefore, In order to integrate IT and business seamlessly, IT needs to understand business problems via knowing the “three sides of the coin,” and provide consultation and recommendations to the business on how to leverage technology. CIOs can deliver ‘competitive capability” to business as many businesses will plateau without IT, so there is a co-dependency that should be recognized in a mature - respectful manner that facilitates the strategic goals and objectives of the Enterprise. It’s a collective and across-functional team effort!


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