Digital technology is radically remapping enterprise strategies and processes, and CIOs are at the center of the revolution.
By Samuel Greengard
Over the last decade, the typical enterprise has watched pixels replace paper and real-time communication and collaboration eclipse faxes, phone calls and in person meetings. At the same time, mobility, cloud computing, big data and social media have washed over the business world like a tsunami—and forever changing the way business takes place and the way employees work.
For CIOs, it's the best of times and the worst of times. On one hand, a CIO's opportunities to build a successful business and IT organization have never been greater. On the other hand, drawing a roadmap and creating a strategy that delivers the organization at the gateway to a digital enterprise is daunting. The upshot? "Becoming a truly digital business is key to how organizations innovate and differentiate themselves from competitors," observes Adam Burden, managing director of emerging technology innovation at Accenture.
Burden believes that CIOs play a vital role in guiding the enterprise toward a digital fabric that, in turn, supports new models of development and embraces a more agile and flexible framework. Part of the answer, he says, is shifting toward more modular and simpler apps that complement core—and complex—enterprise systems. Brad Brown, a senior partner at McKinsey & Company, says that CIOs must be open to radically different business and technology models based on innovation, generating ideas and building digital capabilities—while at the same time establishing a laser-like focus on customer trends.
Among other things, this new role involves aligning investment priorities and measuring ROI in entirely different ways. It also translates into business and IT leaders understanding customer, employee and partner connection points that simply didn't exist a few years ago. Mobility and the Internet of Things are an increasingly important piece of this puzzle. Now, and in the future, data will stream in from every direction and virtually everything. "The key question," Brown points out, "is how can digital technology fundamentally change the company? That is the issue CIOs and other senior executives must address."
Blazing a Digital Trail
Burden believes the role of the CIO will expand. Whereas it was once necessary to simply oversee enterprise systems and servers, it's now about understanding the knowledge a business requires and redefining myriad relationships. "Becoming a digital business isn't about deploying a software product or providing tablets to a sales force. It's a pervasive change that alters traditional ways of conducting business," he argues.
This may require CIOs to blaze the digital trail or take a back seat to others, such as newly designated chief digital officers. Ultimately, Brown says, it's critical to build a framework and infrastructure that allows the organization to transform ideas into real world capabilities. "It's an issue that's based on the needs of the organization and its culture," he says. "It's necessary to have a deep understanding of the business and technology—and how it can best be shaped and adapted."
But there's also a need to explore and experiment, particularly in the arena of idea generation and rapid prototyping. For example, an organization might turn to group jam sessions and hack-a-thons—or establish a bottom-up view that plugs in input from the entire workforce.
Finally, Brown points out that the digital enterprise requires entirely different skills and knowledge from its workforce and outside parties. "A lot of organizations currently lack the required skill sets, particularly in the area of big data and analytics. But there are also issues and challenges surrounding how companies digitize processes."
In the end, Brown says that organizations—and their CIOs—must examine every aspect of the business to identify where digital technology offers value and how the organization can best prioritize ideas and initiatives. This allows business leaders to understand how and where to invest in technology, and when strategic partners make sense. With an end-to-end view, it's possible to look at a portfolio of businesses and understand how to move forward in an optimal way. "In order to make good decisions you really need a crow's nest view," Brown concludes. "The digital enterprise requires a broader and deeper way of thinking."
About the Author
Samuel Greengard is a contributing writer for CIO Insight. To read his previous CIO Insight article, "Scripps Networks Broadcasts a Cloud Approach," click here.
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