Thursday, August 18, 2016

CIOs’ Q&As for IT Digital Transformation

Digital is the leap that will see IT working together with the business to build a stronger company, a business based on performance, growth, and agility.

Nowadays information is overloading and technologies are permeating into every corner of the organization. IT plays a significant role in business growth and innovation. However, in reality, the majority of IT organizations still get stuck at the lower level of IT maturity with the reputation as a back-office support function and cost center only. CIOs as business strategists and senior executives, which questions should you self-diagnose or ask around (business, customers, employees, etc.) in order to improve IT agility and maturity?

Q1: Are IT goals (both at strategic and operational level) clear and achievable? CIOs have to have a clear and big picture of the company’s core business and strategy goals, if not, the IT organization may not be ready to work in new ways or to be able to change in a short time. The well-communicated, clearly defined goals and strategy mapping can help IT gain business respect. With such a volatile global marketplace, it’s time to consider how the business and IT can work together to make IT a differentiator between being midrange or top of your game. Regardless what you call it (alignment, collaboration, integration, engagement or harmony, etc), the top management team should work on identifying opportunities for enhancing IT-business relationship and clarify strategies and business goals. It’s time for IT to make the leap from a functional service provider to business enabler to a digital transformer, working with the business to create a new leaner business model. Digital is the leap that will see IT working together with the business to build a stronger company, a business based on performance, growth, and agility.
Q2: Why is IT still being treated as a supporting function? And how to promote IT as a competitive advantage? CIOs should collect feedback from business partners on how they perceive IT, and what IT can do to improve reputation and promote IT as a competitive advantage. There are two sides of problems. One of the issues is that that business executive still limits their vision of IT as “IT supports a strategy,” the CIO's role as a C-level leader is to contribute to the formulation of the business strategy where new trends of digital technologies will provide strategic business capabilities to the business that will enhance the competitive advantages of the organization. CIOs need to share their view of the company strategies and the strategies in their group, how their group works with other groups, or if any frictions existing, CIOs needs to bridge the knowledge gaps of business executives to the trends of new technology and its impact on the business. CIOs should have the knowledge and ability to demonstrate that IT capabilities as a strategic enabler of the business. The main role of the CIO is to demonstrate to the other executives the added value provided by technology using the business language (as businesses cases). CIOs should understand the business first, otherwise, it is challenging to link the dot between business and IT. Once you show and demonstrate to the other CxOs that you understand the business, they will respect you and give you authority, power, and influence in executive decision-making and strategy management.
Q3: What are CIOs’ best and next practices to build business capabilities and implement capability-based strategy smoothly? The business capability is at a higher level than business process. The core business capabilities are an integrated set of capabilities contribute directly to the competitive advantage of the business and directly impact the success rate of strategy execution. IT is the key component of the business capabilities. Organizational capabilities that exist and the need to be developed, both for necessity and competitive advantage. IT is not just the sum of services or processes, or monolithic hardware only, IT needs to build a set of value-added digital capabilities via weaving all necessary hard and soft elements, in reaching high-level maturity.
Q4: How do business leaders/ users believe decisions are made and how they make them - and how can IT help provide the right information to the right people to make the right decisions at the right time? Information applies to the context and environment in which decisions are made. Information, with the inclusiveness of data as input, is primary drivers of decisions when they apply to automated systems, not human beings. In order to make effective and timely decisions, one of the prerequisites is to recognize your own frame of reference prior to making any decision. Achieving such awareness through serious self-reflection frees you from the habituated 'scripts,' and allows you to see new possible options before decisions are made. Hence, collecting necessary information is an important step in making an objective decision, both analysis and intuition are important in making objective decisions. In the human context, information drives awareness, which can include all of these characteristics, uncertainty, surprise, difficulty, and entropy, although it can also trigger a sense of confidence, confirmation, validation, verification. In the organizational context, IT plays an important role as an information steward to provide the right information to the right people to make the right decisions at the right time.

Q5: How do IT leaders measure success and then pull together the thoughts on the gaps, priorities, disconnects, and needs that exist across the organizations? Historically, performance measurement systems for most businesses have been financing driven. However, in many business situations, financial indicators only cover part of the story. Your measures should cover all areas that contribute to value creation. It’s dangerous to impose metrics just because the focus on what’s measurable is manageable. IT leaders must keep in mind which KPIs best measure IT ability to deliver business value. Continually accelerating changes in IT consumption and production requires faster responses and better performance metrics. IT metrics have to evolve from being a cost center to becoming a revenue generator. The only way to do this is to show a clear link to top executives between IT efficiency and productivity/ top-line revenues. This is an important step to building IT reputation as a strategic business partner.

There are many more questions IT leaders need to ask, and they also should be open-minded to enjoy “out of the box” thinking with alternative answers to spark innovation. Because there’s really no standard answers for most of the questions. IT is not just part of the business; it is a critical, integral component of the business. When a CIO is able to position and leader the IT organization via inquiries to ensure it addresses both IT effectiveness and efficiency, agility and innovation, flexibility and scalability, they have earned their stripes.


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