Digital is dramatically changing business
Digital insurgents are upending successful businesses and becoming the new incumbents.
CIOs have an important leadership role in shaping an enterprise's digital agenda. According to a 2017 Deloitte survey, CIOs are poised to lead enterprise-wide digital transformation efforts. This is a topic where each CIO - in many cases the top technology leader for the enterprise - needs to fully engage with the board and the rest of the C-suite to ensure that digital opportunities and threats are identified and addressed properly.
Tesla, Uber, Airbnb and others are examples of companies using technology to drive incredible shareholder value and, in many cases, they are doing it by disrupting well-established market leaders or entire industries. For established businesses, a key strategic question is whether they will become a digital disruptor or be disrupted.
This article is intended to challenge CIOs to channel their inner CEO and apply their technical and business expertise to help their enterprise become a disruptor and, hopefully, avoid being disrupted.
Disruption is accelerating as a result of new technologies going mainstream
Forecasts around the adoption of new and innovative technologies are jaw-dropping. McKinsey estimates that Internet of Things (IOT) adoption has potential to generate $3.9 trillion in economic impact by 2025. That's the low end of their estimate - the upper estimate more than twice that at $11.1 trillion.
A significant element of this economic impact will be achieved through automation and efficiency improvements. And there are labor market consequences to that. A 2016 federal government report predicted that over the next couple of decades, millions of jobs are at risk due to AI and automation. There is a need to develop and train workers with the new skills needed to calibrate workforces with the new job opportunities created by the new technologies.
CIOs need to be leaders of digital disruption
As technology leaders, business colleagues are looking to CIOs as never before to determine how to put these new technologies to use. CIOs need to master the ability to apply these technologies in ways that differentiate our businesses and create shareholder value.
And if we're not already underway, we need to get moving. Our competitors - both real and aspiring - aren't waiting for CIOs to complete their ERP deployments or refresh architecture standards before turning their attention to setting (and delivering) a business-focused digital strategy.
This can be an overwhelming agenda for companies of any size. But it's critical for CIOs and fellow members of the C-suite to execute effectively if our businesses are to stay relevant in the digital world.
But wait a minute - IT teams are working as hard as possible, right? How can you possibly move faster at deploying these new digital technologies? In terms of acceleration, the public cloud and Agile are your new friends. And, of course, you need to be ruthlessly focused on developing new capabilities that really move the needle.
In a world where technology can sometimes seem to be the answer to everything, don't lose sight of the fact that it's people that apply technology - and a capable and engaged team can deliver incredible innovation if they are properly empowered.
The 1-2-3 of setting, and delivering, a digital strategy
- Set a strategy. If not in place, the starting point for delivering a digital agenda is to lay out a digital strategy. In many cases, the most effective way of doing this is to integrate with the existing business strategy planning process and extend it to form a specific digital strategy. If you have a trusted business consulting group, consider engaging and using their expertise and methodology.
- Each enterprise has its own strategic planning framework but consider including the following techniques, tools and deliverables:
- SWOT analyses
- Case studies on digital disruption
- Use of idea generation/collaboration tools such as MindNode
- A transparent, collaborative strategic plan that's accessible to all stakeholders (PDF, PowerPoint)
- If you're short on ideas, tap into your local start-up community and remember that M&A isn't limited to the CEO - it's an option that can help you jump-start technology disruption for your business.
- Start-ups are typically lean and have an incredible focus and a high rate of innovation. Many larger enterprises will find much to be learned from this type of environment. Partner for co-innovation and, who knows, maybe that start-up could become a good acquisition target.
- In addition to the traditional build-or-buy model for generating technical capability, evaluate the option of acquiring a company to fast-track digital capability, talent and know-how.
- Your strategy should be defined in a way that easily translates into a three-year plan:
- Year 1 - Defines goals and objectives that are specific and measurable
- Years 2 & 3 - Establishes broader roadmap goals that may change based on business performance and market priorities
- Surround yourself with talent. The #1 determinant of business success is having the right talent - and when it comes to talent, you need to be brutally honest about your current team.
- You need talent that:
- Can embrace change
- Has proven digital capability and experience
- Encompasses the experience of your enterprise
- Has credibility with the executive leadership team
- If you have the right talent in place, or you can upgrade through training and development, congratulations! But don't hesitate to make external hires if that's what is needed to get the right team in place.
- Execute with quality. Running secure and reliable environments are table stakes for technology leaders. Credibility and trust come from consistently delivering against your operational and project commitments to your C-suite colleagues.
Make a difference!
Every CIO can make a difference in deploying technology to drive value. Digital is a board and C-suite topic so be sure to talk in business terms that the board and the C-suite understand and, most importantly, talk about the new technologies in the context of how they advance business goals.
There is no standing still in business, especially now. If you're not growing, you're dying and organizations that can rapidly adopt and integrate new technologies will create lasting competitive advantage in their marketplace.
CIOs who can blend their tactical experience along with the courageous leadership traits needed to partner effectively with the C-suite and the board position themselves to spearhead digital transformation strategies that will drive exceptional value.
Steve Phillips will be speaking at the upcoming HMG Strategy 2018 Phoenix CIO Executive Leadership Summit. To learn more about the summit and about Steve, visit the 2018 Phoenix CIO Executive Leadership Summit and Steve's blog.