Data Digest: Business Technology-Focused Companies Win In The Age Of The Customer

Christopher Kelley

Forrester has written extensively about the Business Technology imperative in the Age of the Customer. While the transformation from IT to BT is challenging, Forrester’s Business Technographics data highlights how business leaders have increased – and plan to continue increasing – their technology spending. This means that the train has left the station and CIOs can either embrace this shift or fight against the BT transformation tide.

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.
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Data Digest: Internet of Things Success Requires a Close Partnership Between IT and Business

Marc Jacobson

Survey data from Forrester Research indicates that Internet of Things (IoT) solutions may finally be ready for ‘prime time.’ Business Decision Makers (BDMs) report that IoT has become a top business priority and they are assessing solution feasibility and, in some cases, already investing. IoT will be driven by the business side of the house, but a close collaboration between business and technology management stakeholders is a prerequisite for success. Forrester believes that IoT will ultimately serve as a driving force for the Business Tehcnology (BT) Agenda by changing processes, skills, and the mindset of technology management organizations. 

Forrester Business Technographics® runs a series of annual surveys with business and technology decision-makers measuring technology adoption plans, drivers, barriers and buyer behaviors. Let’s take a closer look at how adoption plans for IoT have evolved over the past year.

Compared with 2014, BDMs surveyed in 2015 were more than twice as likely to report they would begin IoT investment within the next 12 months, 50% more likely to report they were currently implementing or piloting IoT and dramatically less likely to be unfamiliar with IoT adoption plans or report they were not familiar with the technology. In 2015, 49% of BDMs reported that the expansion of IoT initiatives was a “high” or “critical” organizational priority over the coming 12 months.

 

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To Be Customer-Obsessed, Firms Must Also Be Technology-Obsessed

Ted Schadler

There is much talk about being customer-obsessed. What does it take to be customer-obsessed?

Recently, in The New Yorker, Mary Powell, CEO of Green Mountain Power, a small energy company in Vermont, told a story of customer-obsession. Her customer-obsession starts simply: Help customers reduce their energy footprint at no net cost. Green Mountain accomplishes this by investing hugely in the latest and best technology, to pull electricity from the sun, insulate the bejesus out of the house, run massively efficient heat pumps, and micro-manage the draw on the power grid draw. Yes, the capital expenses and labor costs are immense. But when you reduce a home's energy footprint by 85%, you reduce the $250 electric bill by 85% -- or more than $25,000 over 10 years.

Green Mountain Power has a customer-obsessed culture and a customer-obsessed operating model. But it also has become expert in using technology to win, serve, and retain customers. The company is technology-obsessed, often out ahead of even the pundits when it comes to the latest technology. Green Mountain Power unites all three forces to be customer-obsessed: culture, operating model, technology.

The same is true for every company and government. Igniting a culture of customer experience is important. Relentlessly improving the operating model to put customers first is also important. But without the right customer-serving business technology in place, customers will be stuck with ancient web sites, cranky mobile apps, pathetic call centers, and disempowered employees.

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How To Go From Dinosaur To Eagle - Or Risk Being The CISO That Got Hit By The Comet

Peter Cerrato

Peter Cerrato is a principal consultant for Forrester's Business Technology consulting practice.  

A very strange and sudden thing happened 66 million years ago. A comet crashing into the Mexican Yucatan peninsula near Chicxulub put an end to the long reign of the dinosaurs. But not so fast. We now know that some of those dinosaurs survived the massive Cretaceous-Tertiary extinction event: the smaller, faster, feathered and headed-toward-warm-blooded early ancestors of our eagles and hawks.

(source: http://www.newscientist.com/special/living-dinosaur-bird)

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Data Digest: Partner With Business Leaders To Lead The Business Technology Transformation

Tyler McDaniel

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:

  • Improving customer experience – 86% of these leaders rate this as a High or Critical priority
  • Improving products or services – 83% of these leaders rate this as a High or Critical priority
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The Technology Skills Needed To Deliver In A Customer-Obsessed Organization

Sharyn Leaver

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.
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Where Are You On The BT Transformation Journey?

Leonard Couture

The age of the customer offers a unique opportunity for CIOs to own their destiny.  The role of technology and information in helping enterprises win, serve and retain clients has never been more important.  As the leaders of the digital agenda for their enterprises, CIO and CTOs are the key drivers in improving how customers engage with your enterpriseWe call this focus the Business Technology (BT) agenda and there is a major shift going on to invest in both human and technical capital to address it. 

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.
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Customer-Obsessed Technology Platforms: If You Don't Know, You're Doing IT Wrong

Michael Facemire
 
"I don't know about you people, but I don't want to live in a world where someone else makes the world a better place better than we do."
-- Gavin Belson, Silicon Valley
 
Writing software to make the world a better place -- that's a lofty goal, even for Gavin Belson on the HBO hit comedy, Silicon Valley. Yet why is it that we've spent years doing the exact opposite with software in enterprise IT? We've built applications to simply show data living in our data centers. Have a lot of products to sell? Put them all on a web page! Myriad of services you offer to your customers? Throw them all on that web page too! If they really want our help, they'll figure out what it all means, right?
 
Unfortunately this is a terrible way to create applications, regardless if it's on the web, mobile, or any other emerging digital channel. The data is good, but we cannot start with our data in mind -- instead we must start with our customers' needs in mind. But why this change and why now? Our customers (and increasingly our employees) are being presented with so many more options from your competitors, both those known today and tomorrow's digital startups. Simply put, the barrier to creating new software solutions is approaching zero. Making this transformation is central to the BT Agenda -- applying technology to win, serve, and retain customers.
 
 
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Building A Customer-Obsessed Operating Model

Kyle McNabb

Empowered customers, armed with ever-increasing digital capability, increasingly expect any information, any service, at their moment of need. We call this the age of the customer. Innovative brands, from Delta to Southwest, T-Mobile to Verizon, Home Depot to Walgreens, and Caterpillar to Rolls Royce, are sharing with Forrester how they are disrupting the way they work to meet their empowered customers’ needs, to become customer-obsessed. Becoming customer-obsessed gives you, the CIO, an unprecedented opportunity: to overcome the nagging frustration of IT gravity that suppresses your and your team’s ability to influence the direction of your business, to build new competitive advantage. But you have to be willing to change the way you work.  

You’re in an enviable position and are more essential to your firm’s success than ever. Together with your CMO, you have the best overall knowledge of your customers and the technology know-how to deliver a superior customer experience and drive growth.

We’ve begun to identify how leading firms change their operating models to deliver more value and become truly customer-obsessed. Much of that change falls on the CIO to drive. This research is ongoing, but the actions leaders take to shape their customer-obsessed operating model — focused on customer loyalty, innovation, and most importantly, growth, and fueled by customer insight — are becoming clear:

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Business As Usual Not An Option For Customer-Obsessed CIOs

Steven Peltzman

As Forrester’s own Chief Business Technology Officer, I’m immersed in our strategic view that consumers and businesses alike demand outstanding customer experiences and expect them more than ever before. In fact, it’s so important to us that we are being measured against the Customer Experience Index (CX Index™) on delivering a great customer experience.

The trouble is I’m experiencing many of the same blockers that our client CIOs say they have: the over-customized legacy infrastructure that won’t go away, constrained budgets, and less resources than we wish we had. Sound familiar? Through it all, we’ve made great progress — an improved website, a great iPad app, cloud infrastructure, etc. — and there’s more to come.

That’s all good, but good is not good enough in the age of the customer. With the threat of Digital Disruption all around us, we feel a great urgency to do more and do it quickly.

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