Wednesday, December 6, 2017

Modern IT organizations with Three Digital Competency


Digital CIOs have to develop a set of organizational competencies and shift IT reputation from a cost center to a profit center.

IT plays a significant role in the digital paradigm shift. The unprecedented opportunities brought by digital technologies and increasing speed of change can lift up a fast growing business promptly. It can also reinvent a well-established organization to reach the next level of the business growth cycle. The CIO must run a modern IT organization with core competency. A core competency is a harmonization of multiple organizational capabilities underpinned by business processes, such that it permeates the entire organization with a focus, and in alignment with the resource-based view. Here are modern IT organizations' three digital competencies.

The strategic competency of IT:
Technologies nowadays are the disruptive forces behind digital disruptions, and the information is the lifeblood of modern businesses. Thus, from a strategic perspective, IT is the value-added delivery that makes the organization different and competitive. IT is, in fact, the strategic competency of the business. From IT management perspective, there is no stand-alone IT strategy. IT is business and IT strategy is an integral component of business strategy. To build the strategic competency of IT, CIOs should have knowledge and ability to demonstrate IT as strategic business competency as well. CIOs need to be part of the executives for articulating differentiated IT-enabled business competency to underpin strategy execution. However, often the main problem is that business executives still limit their vision of IT as “IT supports a Strategy.” Thus, the digital CIO role as C-Level is to contribute to the formulation of the business strategy where new trends of technology and the abundance of information will provide strategic competencies to the business that will enhance the competitive advantages of the organization. Today's IT organizations encounter many distractions stopping them from laser focusing on achieving strategic goals. Many IT organizations suffer from overloaded tasks and overwhelming information, prioritization brings transparency and aligns IT portfolio management with the strategic business goals and objectives. Thus, keeping IT dynamic is crucial for adapting to unforeseen urgent changes in the business or other fields.

IT operational competency: “Keeping the lights on” is still fundamental. IT must ensure that operational business ecosystems not only function as expected but also achieve operation proficiency via continuous consolidation, modernization, integration, optimization, and orchestration to facilitate the business outcomes, develop premium operational competency and build an effective digital ecosystem. CIOs should optimize business operation management capacity with a keen eye to grasp growth opportunities, manage risks, and improve operational efficiency via applying lightweight technologies seamlessly. IT also plays a crucial role in empowering digital workforce with efficient tools to improving productivity, achieving workforce excellence, and integrating people, process, and technology into the differentiated business competency. That's a completely different mindset from managing technologies only. Building IT operational competency is fundamental, but it’s not easy. It is challenging because it requires some kind of rethinking and reinventing corporate processes and re-tuning the business competency. When IT operation is refined to the point that they are nimble, can adapt to changing business demands in a timely fashion, and it can be reapplied to altering business priorities and be effective with little down curve, IT is on the right track to achieve high-level operational competency.

IT innovation management competency: The essence of innovation is about how to manage people, assets, and resource to meet the business goals for innovation. CIOs need to become business leaders within IT and seek ways to grow revenues, profitability, and spur innovation. More specifically, the understanding of what technology can help companies achieve and run IT as an innovation engine of the digital business. IT is uniquely positioned to observe business processes across the enterprise. Sometimes when one business area has a new product that can be used by another, IT leaders can connect the wider dots to come up with new innovative solutions. To build innovation management competency for IT organization, the difficult challenge is not just launching successful teams, but maintaining the motivation and focus of the people. Innovation is not a serendipity, it is a management process and business competency. It requires much more time, energy, passion, courage, experimentation, practices, retreat, reflection and even failures, to get clear and focused on innovative ideas, business models, processes or solutions, and to then enact, embody and execute in a disciplined way.

Leveraging unique IT knowledge and capability to build business competency is crucial for the business's long-term growth and maturity. Digital CIOs have to develop a set of organizational competencies and shift IT reputation from a cost center to a profit center. It requires IT leaders to think longer term and better ways to do things. The unique business competency makes you shine even on the raining day, and differentiate yourself from competitors, to reach the next level of IT management maturity.






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