Monday, November 11, 2019

The Digital CIO with “Strategic and Paradoxical Intelligence”

Only under the strategic leadership, IT can unleash its full potential and reach the next level of organizational maturity.

IT is increasingly supportive of competitive position of the business. IT matters not only because it’s pervasive, but also because it continues to advance, its nature of the "constructive disruption" and its “paradox in management.” IT leaders have to deal with issues that combine contradictory features or qualities. At the highest level of organizational maturity, IT needs to become the game changer for their company.

The digital CIO needs to fine tune both strategic competency and operational excellence of their organization: To survive in today’s digital dynamic, businesses across vertical industries have realized that this is not temporary, it’s a deep social, economical, political, and ecological shift that they are going through; it’s going to last, and it’s going to intensify. IT is an enabler of current and future capability for both the organization and its ecosystem. Thus, strategic thinking CIOs have to strike the right balance of long term vision and short-term profitability; strategic flexibility and operational excellence, growth and stability, etc. The key here is engaging the whole organization in knowing and understanding the key strategies of the business and why the leadership has chosen them.

 Digital CIOs are in the unique position to oversee the underlying organizational structures and functions, understand business complexity and its dynamic ecosystem, have a better chance to create a blue ocean for providing the business competitive advantage; and shape IT-enabled core business competencies.

Nowadays, strategic planning is a “living process,” with regular evaluation, scanning, listening, revisiting and potential course correction. It’s important to help the organization build strategic competency based on the circumstances that will allow the highest probability of business success. Besides that, achieving operational excellence is still fundamental for IT to integrate, optimize, and orchestrate organizational processes to facilitate business outcomes and develop an effective digital ecosystem.

The CIO needs to focus on both innovation and standardization: Innovation is about how to apply out-of-the-box thinking to come up with novel ideas and transform them to achieve their business value. The business should always be open to, conscious of, and feel empowered to act upon-Out of the box thinking. It is very much a "consciousness" thing, Standards are a form of embodied technical knowledge accessible to all types of business that enable highly effective products and processes development.

Standardization is inside-the-box, and innovation is outside-the-box. Hence, organizations need both, and in fact, cannot realistically exist without a healthy balance of both. Innovation is one of the differentiated business competencies which are underpinned by varying business elements such as people, process, and technology. Digital innovation expands its horizon to include soft innovations such as communication innovation or cultural innovation; besides hard innovations such as product/service/business model/process innovations. IT has to contribute to both- business innovation and standardization. It’s important to raise your consciousness of the balance for running a highly innovative and high mature IT organization

The CIO needs to master both management and governance: Digital technology is often the disruptive force behind change and information is permeating into the very fabric or core processes in modern organizations. IT management enables the business moving forward while IT governance is crucial to steering business toward the right direction and make effective business decisions. The management and governance are complementary functions, the digital CIO needs to master both well. 

In fact, IT oversees enterprise-wide information which is the lifeblood in modern businesses. As such, IT plays a significant role in overall business governance. The purpose of governance is to facilitate all business units in competing for the dollars based on benefit to the enterprise. Highly effective IT governance must create good IT performance, not only for keeping the lights on, but also for the long run business growth. 

In practice, making a good policy is actually part of governance discipline. No process works without policy. A process in and of itself must be governed or it won't be followed and the best procedure or program cannot enforce it, without policy. It means that the CIO role must drive a model of governance supported by business policy, then “the why and what” will be effective. 

Neither business nor IT knows the full picture on these two pieces of the puzzle - management and governance until they work together, thus, cross-functional collaboration is crucial. The possible governance methods, techniques, structures, etc, are based on the design of management system which generally has a strong process element and the manner in which those management systems mesh with the governance arrangements.

The digital CIO with strategic and paradoxical intelligence can run IT as a trustful business partner and a key differentiator of the company. Many factors influence a CIO's choice about where to position his/her information resources along with business continuum, such as the organization’s risk appetite, regulatory environment, size, stage in lifecycle, market environment and current conditions.

 The ultimate success of IT should be evaluated on how IT is able to deliver innovative products/services or supply a differentiated solution that contributes to both top line business growth and the bottom line success of the organization. Only under the strategic leadership, IT can unleash its full potential and reach the next level of organizational maturity.


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