Is there a fundamental problem in today’s IT? I believe there is, and it’s this: IT decision-makers are too often focused on the wrong things.
In a recent study, Forrester examined the top priorities, topics, and terms from a variety of data sources for both business decision-makers and technology decision-makers. What we found was a very clear — and to my mind, troubling — distinction between these two groups.
Business decision-makers focus on topics like growing revenue, improving customer satisfaction, and hiring, developing, and retaining the best talent. By contrast, IT decision-makers focus on topics like improving project delivery performance, improving budget performance, and cutting IT costs.
The fact that IT decision-makers have so little focus on business outcomes is one of the main reasons IT is seen as disconnected from the rest of the business.
The only way for CEOs and CIOs to fix this is to begin to measure IT professionals more in terms of business-outcomes and less on project delivery and system uptime. In other words, we need to measure IT professionals using the same KPIs we use to measure leaders across the rest of the business. This means we must begin measuring IT’s impact on things like the change in customer satisfaction (that’s the company’s customer satisfaction and not IT’s internal “customers” as some groups like to refer to other employees in the company), or the increase in sales, or the ability to attract and retain top talent.
While Social Business continued to evolve in 2012, 2013 will see the emergence of digital business as a new strategic theme for many firms. What's driving this shift and what does it mean for CIOs, CEOs, and chief digital officers?
The Communications Evolution
Communications continue to evolve. Consider how humans have transformed communications over the centuries: signal fires; semaphore; Morse code; the telegraph; the telephone; telex; fax; email; SMS; Facebook; and Twitter. I have no doubt that this evolution will continue in 2013 and beyond. Perhaps beyond 2013 we will eventually achieve the ability to communicate our thoughts directly — whether we’ll want to is a different question. As people the world over learn to use new social networking tools, they drop older tools that are no longer useful to them. Regardless of where you are in your personal communications evolution, the undeniable truth is that over the past decade we have significantly changed how people communicate; we are no longer dependent upon email. But social tools and 24/7 mobile access have not removed the complexity or decreased the volume of information we must process. Time remains our most precious resource and we’ll always seek ways to use it more effectively — but social tools are not necessarily the silver bullet we might think. In 2013 we need to rethink business processes to take this new communications paradigm into account.
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. . . and thanks in advance for sharing your experiences.
As I analyzed examples of digital disruption I’ll be highlighting at the upcoming CIO Forum — “Leading Digital Disruption” — I was struck by the way in which every example could be tied to a shift in customer experience along two dimensions: pleasure and time.
Along the pleasure dimension, disruptive technologies significantly increase the pleasure (or reduce the frustration) derived from the customer experience. For example the iPad significantly increased my pleasure in browsing the web and engaging with brands I like through tailored apps.
And on the time dimension, disruptive technologies save customers significant amounts of time; time being the most precious commodity in the world. My iPad allows me to do many things much faster than I could before because it is easy-to-use and contains many apps which connect my lifestyle together.
So I began to explore how CIOs might use this understanding to help shape the analysis of prospective disruptive strategies. What I came up with is the customer experience zone of disruption (or CxZOD for short — see illustration).
In the zone of disruption, the impact on pleasure and/or time is so great as to cause a disruptive force in the marketplace. When coupled with an assessment of potential market impact, this becomes an easy-to-understand visual model for comparing potential disruptive initiatives.
In my session at the forum, I’ll be exploring this model and showing how to use it to better understand existing technologies, such as mobile apps, and their potential to become disruptive.
What disruptive digital technologies would you place in the CxZOD? Post your comments below or Tweet #CXZOD
Forrester held its first CIO Summit in New Delhi, India on September 26, 2012. The theme of the event was “From IT To Business Technology (BT) And Beyond.” There were more than 100 attendees, and it was truly a memorable experience interacting with everyone. By the end of the day, I had received encouraging responses from attendees, as many CIOs expressed their willingness to work with Forrester. They found that no other research firm focuses on understanding how changing customer expectations affect what the business needs from them or helps them make better decisions to become successful and influential leaders. We had a great mix of analyst and CIO presentations, and the panel discussion on “Taking Your First Business Technology Steps” with our guest CIO speakers was complete bliss.
The key takeaways from the summit:
· IT/business alignment doesn’t necessarily equate to success. The consumerization of IT and fast-changing business dynamics make it challenging for CIOs to continue to align their IT organizations with the business. The reality in today’s world is that IT must become an integral part of the business and CIOs need to develop their IT strategy in conjunction with business leaders.
· Disrupt or be ready to get disrupted. According to Forrester’sForrsights Budgets and Priorities Tracker Survey, Q2 2012,customer expectations are the top concern among business decision-makers in Asia Pacific. Today, customers are redefining differentiation for organizations in the age of the customer and are setting the stage for rapid digital disruption.
George Colony, our CEO, just released a post on his blog about enterprise architecture, aptly enough named “Enterprise Architects For Dummies (CEOs).” I retweeted the post to my followers and received a flood of responses, most of which were violently disagreeing with George’s assertion that EA works for the CIO. I think this is a pointless argument, but underscores a very important change that most are missing.
Here’s what I mean:
The objection to putting EA under the CIO is based on an old-school notion.That notion is that CIOs are chief technology infrastructure managers. Our data shows that the role of CIO is changing, fueled by cloud and other as-a-service technology. CTOs or VPs of IT are increasingly taking on the job we used to think of as the CIO, while progressive CIOs are evolving to something else. Locating EA under the CTO is a bad idea, we all agree.
Every business is a digital business.If you don’t believe me, I’ll send you a pile of research. There is no such thing as a non-information-centric business anymore — or at least there won’t be for very long, because they are going out of business. Forrester has been using the term “business technology” (BT) for a while to indicate that there is no room for having separate business and IT — it simply won’t work much longer. Even in the most paper, analog verticals, we can give you example after example; check out Monsanto’s IFS (they are a seed company!).
With VMworld in full swing this week and Microsoft’s cloud-centered Windows Server 2012 launching soon after, your options for technology to build and deploy enterprise clouds is about to expand significantly. Meanwhile, Amazon continues to drop prices faster than your local Wal-Mart, introduce new cloud compute and storage services almost monthly, and has already gobbled up a trillion objects in S3. Is it time to start moving your workloads to the cloud?
Forrsights surveys show that companies are indeed moving to the cloud, primarily for speed and lower costs — but are the savings really there? The answer might not be obvious. Are you heavily virtualized already? Have you moved up the virtualization value chain beyond server consolidation to using virtual machines for better disaster recovery, less downtime, automated configuration management, and the like? Do you have a virtual-first policy and actively share resources across business units? If you run a mature virtual environment today, your internal infrastructure costs might already be competitive with the cloud.
Indian CIOs are at the risk of losing business credibility if they do not improve their understanding of business technology (BT). This is the key finding from thelatest report that John Brand and I just published. For this report, we surveyed 130 companies in India, using Forrester’s BT Leadership Maturity Model as a baseline for gauging the BT maturity and readiness of Indian organizations. Our survey revealed a surprising level of consistency and positivity about BT among Indian firms, regardless of organization size, type or industry.
This was especially surprising given that BT is a relatively new concept in emerging markets. When we asked CIOs at Indian organizations to define BT in their own words, the responses displayed an overwhelmingly enthusiastic and optimistic view of BT; the most common theme centered on the value of BT as a general principle. However, many topics that were widely cited in self-assessments from CIOs in more mature markets like North America, Europe, and Australia/New Zealand were all but ignored by Indian CIOs, including time-to-value, market differentiation, communication, and governance. As Indian CIOs have not long been exposed to the general concepts of BT, Forrester believes that inflated self-rankings are mainly attributed to a lack of understanding of just how comprehensive BT is.
The report helps answer key questions such as:
· Why are Indian CIOs remarkably consistent in their BT views and attitudes? And is this really just due to a common tendency to inflate their own BT maturity?
I recently spent a few days in Connecticut, USA, with Pitney Bowes. So why, you ask, is a CIO advisor who spends most of his time talking about the future of business technology in Asia Pacific spending time with a company that makes machines that stamp mail? That is a good question, and one I hope to answer while at the same time showing where I believe Pitney Bowes can help in your organisation.
So Pitney Bowes stamps mail. Yes — but they see it differently. They see that they enable communications with customers. Interesting. But mail is declining — right? Yes, it is, and Pitney Bowes has made many acquisitions to position itself as the leader in the digital mail space. And they have gone from just providing the communications capability to working across the entire customer lifecycle. Acquisitions of Portrait Software, MapInfo, Group 1 Software and many of the other firms they have acquired in the last 10 years have given them the ability to do:
- Customer profiling and segmentation
- Data preparation and composition
- Multi-channel customer output
- Customer response management
- Response analysis
I presented the keynote at the Biztech2 event in Mumbai last week. It was a big evening, as almost all key Indian CIOs were present at the event. The theme of my keynote was “The Empowered BT CIO,” which triggered some interesting thoughts, as all of the discussions that I had after the presentation were mainly around “business” with hardly any mention of “technology.” Below are the key points mentioned by CIOs in my discussions with them:
“We do all the work and business leaders take all the credit. But if something goes wrong, we are the ones who get the blame.”
“The money is with the finance and marketing departments, and we have to depend on them for our budget. My CEO should change this structure.”
“I don’t have followers in my organization.”
“My organization doesn’t give me the same importance as it gives the CFO or CMO.”
“Through technology innovation, I helped the company reduce IT spending and save money.”
All of these points have one thing in common: “my present role and issues that I face today.” But no one talked about their future role! My response to them was consistent, as I categorically highlighted that CIOs have two options:
Continue with your current approach — but then the future role of the CIO will be dismal.
Step up and take the challenge to shape the business. Take it as an opportunity to transform your role in the empowered world.