Back when I worked in I&O we weren’t very popular. Not personally, mind you, but as a team. Why? Because we seldom satisfied user requests quickly, and sometimes not at all. We were the defenders of stability, resistant to change. Just maintaining the technology every day - “keeping the lights on” - took a lot of manual effort. We chased down a lot of defects, and then we struggled to get fixes created and put into production. Sometimes the fix created a worse problem. It wasn’t a lot of fun, the pressure was grueling, and one by one we moved on to other jobs.
So today when I tell clients about transforming I&O from an under-appreciated cost center to a respected strategic advisor, I understand their skepticism. What does it take? For starters:
You have to change the monitoring and analytics technology.
You have to change the attitudes of the people within I&O.
You have to change the perception of I&O across the organization.
Those are not small changes, and cultural changes move especially slowly. Or do they?
The I&O team at Dixons Carphone, a UK technology retailer, transformed in a year. Yes, one year. With a motto of “say yes more,” Dixons Carphone I&O went all-in on customer focus and agile operations:
Rather than using a lengthy RFP process, monitoring technology proven effective in one business unit was extended across the organization.
Rather than focusing on technology health, the focus was shifted to customer experience.
Rather than focusing solely on the needs of consumer customers, attention was also given to the needs of internal users, line-of-business managers, and executives.
The pace of business – heck, the pace of life, gets faster and faster. Faster processing, faster delivery, faster innovation – and faster adoption and abandonment of that innovation -- is the reality we all live in today.
Leaders run fast businesses to win and to stay apace or in front of dynamic customers and disruptive competitive forces. They can’t out-slow the competition. Speed is the only option.
I had the pleasure of participating in a webinar panel to discuss what it means to work at one speed (fast) versus at two speeds as bimodal IT advocates. We discussed why businesses are forced to go fast, the reality and downside of a bimodal IT strategy, and the strategies and approaches to winning based on speed. Here is a quick view of the ground we covered.
The first part of our discussion focused on the factors that are making companies operate at fast speeds. Broadly, it comes down to three factors:
Hyper-adoption and hyper-abandonment: Customers are willing to rapidly try, use, and then possibly discard content, apps, and services in a world of seemingly infinite choices and extremely low cost to entry and exit. This dynamic fundamentally changes – speeds up – what it means to “have” a customer.
CEOs and their leadership teams are at a crossroads as technology underpins virtually all customers' expectations and unlocks new sources of customer value. The choice is rather straightforward: invest heavily in business technology (BT) to win, serve, and retain customers, or flounder under the weight of legacy IT.
This is no time to hedge. Strategies like bimodal IT that advocate for silos and two operating speeds may appeal to risk-averse leaders, but bimodal won't get the job done. In fact, it works directly against the key operating principles of customer-obsessed firms in B2B and B2C industries like General Electric, Netflix, and USAA. These firms and other leaders use the customer as the central design point for their business technology strategy and strive to be:
In addition to highlighting the importance of the BT agenda, these data also show the difference between BT-Leaders -- companies that embrace a BT agenda -- compared to BT-Laggards – companies that are entrenched in the traditional IT mentality vis-a-vis Business Technology needs.
Specifically, we found that businesses with IT departments that help accelerate business success are more likely to:
Have had double-digit growth in 2014. The bottom line is important. We found that 30% of companies that BT-Leaders grew at 10% or more in 2014 compared to 2013, compared to 26% of BT-Laggards.
For CIOs, finding a clear path forward in the Business Technology (BT) Agenda can seem daunting, as you work to balance critical operational requirements with new initiatives designed to help your organization win, serve, and retain customers. But there are trailblazers in your organization. Forrester continues to see spending on technology spread and move out of the CIO’s organization and into the business. In North America companies of more than 250 employees, 70% of technology spending is either business led or heavily influenced by business. That part is not new, but it is increasing.
Specifically 50% of business managers, directors, and vice presidents are increasing their departmental budgets on technology products and services over the next 12 months.1 In fact, 16% of these business leaders are increasing their spend by more than 10%.2 This isn’t shadow IT in action; it’s the new way of doing business. Within your own organization a minority, but important, population of business leaders are aggressively investing in technology products and services to achieve three essential business goals. Over the next 12 months, the 16% of North American business leaders dramatically increasing their spending are focused on:
Digital technologies have shifted control into the hands of your customers. Your customers are now independent, active agents in everything, from selecting the channels and platforms they prefer, to the very definition of your brands. As CIO, you’re in an enviable position and are more essential to your firm’s success than ever. You have the technology know-how to tap into these digital technologies. And together with your CMO, you can lead your firm to become customer obsessed and create the digital experiences that win, serve, and retain customers. But you have to be willing to change the way you work.
CIOs of customer obsessed firms must embrace an accelerated pace of change and reinvention, for themselves and their organizations. But years of radical IT outsourcing have denuded many technology management organizations. In fact, Forrester's Q1 2015 Digital Experience Delivery Survey found that the top barrier to success was a lack of resources. So your first order of business as CIO? Invest heavily in new skills:
Software engineering.Software (and how well it does or doesn’t perform) underpins the brand for digital businesses, making core software development and delivery skills paramount to your firm’s future success. Agile methods, continuous-delivery techniques, and product management skills will be critical – not just in pockets, but scaled up to address all software engineering needs.
There are some simple guidelines to help measure where you are on the journey:
Where is your innovation happening? Innovate at the point of customer interactions – digital value is determined by how used the innovation is. There is no better way for CIOs to be part of the age of the customer than to deliver digital innovation when and where the customer needs it. The complexity of how to build enterprise-wide digital engagement can only be answered by having a strong BT agenda powered by BT professionals who think and act in an agile, iterative manner. Your customers will engage your enterprise in many different ways: if you are not building an adaptive experience for them they will move on no matter how good your products may be. This type of measurement approach is critical to realizing the effect of the digital experience you are building. In the end, the only thing that truly matters is how your customers are engaging your enterprise.
At Forrester’s Forum For Technology Leaders in Lisbon (June 2-3), Marcello V. Ronco, Senior Vice President and Head of Core Banking Production Line of UniCredit Business Integrated Solutions (UBIS), will be speaking about the bank's BT transformation journey and, in particular, its mobile banking initiative. Marcello is co-leading with Marketing Directors within the organization the restructuring of UniCredit Retail in Italy, Germany and Austria, to realize the company's ambition to become a truly digital omni-channel bank. In his session, Marcello will explain how to change a traditional IT department so that it is set up to support a modern multichannel bank, and why IT plays a strategic role to ensure the right level of customer service through mobile banking.
As I prepared for my role as Forum Chair, I spoke to Marcello about his views on the age of the customer and the impact it has on financial services organizations such as UniCredit. Here is what Marcello shared with me, and I hope you will enjoy his answers as much as I did.
Q: How is the age of the customer impacting your industry (financial services) and the solutions provided by UniCredit Business Integrated Solutions?
In case you missed it, Forrester recently published its predictions on what and how I&O organizations must prioritize in 2015 to pursue the Business Technology agenda. The predictions are focused on how to innovate so that you can meet the speed, quality and agility your business demands. It also discusses the transformation needs I&O organizations are facing across people, processes and technology -- in particular how you must focus much of your efforts on enabling your workforce to be productive.
As I have been in I&O since the beginning of my professional career (which means forever), I see 2015 as a year to transform our I&O profession and organizations. The opportunities are spanning from partnering with your Application Development & Design team in a new way of operations -- we call this Modern Service Delivery (you might have seen this as DevOps); explore new ways to enable your workforce and how to change your approach to the technology supply chain and ecosystem. See for yourself what our predictions are. The full details can be found here in the November 20, 2014 report, "Predictions 2015: Infrastructure & Operations Prioritizes Pursuing The BT Agenda".