The commercial side of IT helps IT organization lift its maturity as the strategic business partner, and transform IT from a cost center to a profit maker.
When IT only focuses on the technological side of operational management, it has often been perceived as a cost center and support function. To reinvent IT as the growth engine of the business, the digital CIO today needs to be "commercial" and has business acumen and know how to promote IT effectively, so the business partners understand the wholeness of how IT makes contributions across organizational boundaries.
When IT only focuses on the technological side of operational management, it has often been perceived as a cost center and support function. To reinvent IT as the growth engine of the business, the digital CIO today needs to be "commercial" and has business acumen and know how to promote IT effectively, so the business partners understand the wholeness of how IT makes contributions across organizational boundaries.
The readiness of IT for business initiatives: IT needs to understand how the organization works and then provides tailored business solutions that will increase the functionality and improve the business performance. Effective IT management means understanding every island of business operation and every important workflow process. It is through this comprehensive business understanding that a CIO would be able to identify true cost savings, workflow optimizations, and additional revenue opportunities. IT should be highly available and efficient internally that It can take minimum time to market. IT also 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, and increase the business’s responsiveness to changes. IT can not only contribute to the business growth, CIOs can help businesses improve net profit, by reducing the cost of doing business and keeping costs down while at the same time maximizing its output so when the business revenue increase, IT cost remain the same, it will improve net. The digital CIO has to foresee, anticipate business needs for information and then prepare and gear up the information systems to not only make readily pertinent information to top business decision makers but also preempt the need and present the multidimensional business value accordingly.
Optimize IT operational manageability and stop the revenue leakage due to IT systems errors: Due to the disruptive nature of technologies and overwhelming growth of information, IT simply cannot stand still, it has to keep improving IT services and operational manageability. IT optimization is about leveraging technologies to lower costs, improve operations, and increase revenue. The low maturity of IT stems from the industrial cultural norm that accepts IT as a tactical function, but not as a strategic partner. Therefore, to run a highly effective digital IT as the business growth engine, IT has to switch its perspective from inside-out operation driven to outside-in business focus and customer-centric. It means to leverage more resources and talent to increase revenue and improve customer satisfaction. It has to bring both effectiveness and efficiency of the process which is obviously run on IT Systems. Many traditional IT organizations spend significant time, cost and resources to maintain the heavy out of date IT system and legacy applications. The overly rigid process is an outcome of applying rigid process approaches where they don't belong, and IT systems errors will cause the revenue leakage and damage the business's reputation. Thus, the biggest challenge for CIOs is keeping up and stepping up, recognizing the responsibility for ensuring that the business is better informed than competitors and more nimble at building dynamic business capabilities to embrace the disruptive opportunities that are constantly emerging.
Customer experience is being the main driver for IT differentiation and in the end business profitability: Customers are at the center of a digital organization. IT has two sets of customers, internal business customers as well as end business customers. Now information can provide customer insight and technology can improve every touch point in customer intimacy, it provides a significant opportunity for IT to influence customer experience directly. Besides internal customers, end customers should also be IT focal point, CIOs must go out and talk with customers to understand business and understand their tastes and current and future needs. Customer centricity is built upon rigorous business’s capabilities and processes, it is not just support-related but can foster new and better ways the application can perform and optimize every touch point of customer experience. Imagine collecting valuable information about customers in real time and getting that to the right teams inside your company. New technology tools and business models allow a company to capture customer information on a continual basis. Retention of customers/reduction in the churn with better management of services provided to the customers will be an indirect way of increasing and maintaining the revenue. Keep in mind, customer experience isn't about improving things for the customer at any cost. It's about having the real insight to make confident business decisions that result in unambiguous ROI.
Digital IT has many faces, the technological side is perhaps hidden inside as the business enabler; the customer side of IT should be intuitive, and the commercial side of IT helps IT organization lift its maturity as the strategic business partner, and transform IT from a cost center to a profit maker. Doing so demands quality time spent with sales/marketing, operations, finance leaders and even end customers, to keep integrating, engaging, optimizing, and accelerating IT to reach the high level of business maturity.
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