Monday, October 26, 2015

Three “V’s in Running a Digital IT

Digital IT is becoming more visible and transforming from a back-office cost center to a front office innovation engine.

IT provides competitive leverage to business’ long-term growth: Because more often, technology is the cause of innovation disruption and information is the lifeblood of business; How to run a digital IT which understands stakeholders’ expectations and propose a service/solution portfolio that correspond to both demand and cost drivers with a focus on business priority, and develops the professional competencies needed for successful business solution delivery? There is an “alphabetic soup” in running a digital IT which must lead in reaching high-level performance and maturity; besides triple “I”s - Information, Innovation, and Integration, triple “A”s - Automation, Analysis, and Agility, triple “C”s - Change, Collaboration, and Cloudification, triple “P”s - Principle, Process, and Performance, triple “E”s Enablement, Exploration, and Effectiveness & Efficiency. Here we introduce triple “V”s in running a high-performing and high mature digital IT:

Vision: Technological vision & problem-solving skills are about in-depth understanding both technology and business, and have genuine empathy with the users of technology. IT needs to have a clear vision and roadmap to which CIOs expect the IT department to deliver. To build and demonstrate IT success, IT leaders need to focus on the business -IT roadmap; that is how IT supports business objectives and processes leveraged by IT and an effective IT strategy as an integral component of business strategy. With a clear vision, passion follows. In order to drastically change IT landscape, you must have passion and drive at the core along with these qualities--Genuinely curious about Information. A great CIO should be able to not just understand business objectives and priorities, but also be able to break these down and cascade them downstream to his/her team in an IT-comprehensive format. It’s about having problem-solving skills and technological understanding  that give you the ability to invent new ways to create or manage information effectively to drive business growth. It is about determining what Information you need to make a difference, what data and what process is necessary to instrument that information and putting the data capture and information instrument processes in place. The common pitfall for IT leader is to fail to make the connection between IT and the business, lack the cognizance of how it will actually impact the company's top line and bottom line growth and, therefore, cannot be the enabler that companies need.

Value: Digital transformation starts with mind shift, business value has to be driven, indicated and understood at all levels of the organization. This is accomplished through establishing strong interdependent relationships, the shared vision and wisdom, the frictionless business culture, the re-framed processes to bridge silo, and the optimal sets of business capabilities to delight customers. IT value is multi-faceted and it’s interesting to see how IT value is in the eye of the beholder. IT value-based management needs to be driven by concepts like collaborative value or collective advantage and multi-layer ROIs. IT value is demonstrated through the rate of productivity increases, the rate of new product development, the rate of market share gains, the rate of customer approval and satisfaction gains, the rate of sales gains, etc.  There’s inspiration from prior design patterns, no value chain possible without UX perspective (at least according to the UX person), risk management perspective has made its appearance, as it has sunk cost, and (IT has no value if there are no improvements. In reality, it's a combination of all of the above. What combination is important in a given organization depends on who is beholding that value. One can start with a standard set of these metrics, but ultimately, only metrics that are worthwhile to the stakeholders should be employed. Triangulate value from different value lens in building a more comprehensive IT value proposition. There are tangible (cost savings, efficiency, etc.) and intangible (brand equity, sales enablement, etc.) components of value. Each IT organization has a set of capabilities that enable it to achieve successful outcomes, whether financial, brand, or double bottom line. So it needs to create the alternative IT value index- comprising of value lenses such as strategic imperative, operational excellence, and business agility.

Variety: Digital IT is dynamic, with a variety of teams to run the variety of IT portfolio. IT has to adapt to changes via managing a healthy portfolio via continuous consolidation, simplification, integration, modernization, cloudification, innovation, and optimization. Otherwise, the spread of applications can quickly get out of control. Often applications that once added significant value to the business remain in the portfolio, being supported and licenses being renewed, when they have been superseded by a 'better' alternative. Unused or under -utilized applications that consume a disproportionate amount of resource when compared to their value, need to be addressed.  Once you start treating projects that way and measure success of business projects as a whole, rather than keeping technology ones separate with silo thinking, and ensure that all business units required for the success of the project have requirement clearly defined with engaged stakeholders and with senior business leaders on the steering committee, you will see success of all projects increase. It takes holistic thinking and planning. The variety of IT portfolio is to build a unique and varying set of business capabilities, to enforce agility, harness innovation, and improving IT maturity.

The bonus "V" is Visibility - at industrial age, IT is invisible when the light is on and everything is normal; however, digital IT is becoming more visible and transforming from a back-office cost center to a front office innovation engine. And digital IT has visibility to both influence corporate strategy and culture and touch customer experience and employee engagement. Compared to traditional service- driven IT, a value driven and capability-based digital IT has clear VISION, laser focus on business goals, and multifaceted VALUE delivery, running a VARIETY of IT portfolio to build a unique set of business capabilities, and improve IT maturity from efficiency to effectiveness to agility; from functioning to firmness to delight.


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