Déjà Vu All Over Again, Or Why CIOs Still Fail At Communicating Value

Peter Burris

One of my colleagues, Karen Rubenstrunk, is a principal advisor for our CIO Executive Program. I’ve known Karen for close to 20 years; she is a superior CIO coach. Recently, we found ourselves discussing the challenges CIOs have communicating business value. Here is Karen’s point of view:

If you’ve been around tech management as long as I have, at some point you’ve had the conversation that keeps on giving (like heartburn): how to better communicate the value of technology to the business.

Like me, I’m sure you’ve continued to wonder why we keep having this conversation over and over and over.

At a recent CIO Group Member Meeting, I found myself drawn into this conversation yet again — and being the lone dissenter in the room about what to do about it. While we kept talking about which new technologies or recent economic trends were making the task of communicating value so difficult, I’ve learned that the real problem isn’t technical, it’s personal: CIOs need to focus on perceptions and invest in the power of personal relationships with business peers.

Perceptions Drive Value

Technology’s perceived value to the institution is directly related to the maturity of the relationship between technology management and other functional managers and their teams, and that relationship is built on two fundamental perceptions: 1) the business’ perception of its dependence on technology, and 2) the business’ perception of technology management competence (see figure below).

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HIMSS: Moving The Model From The Hospital To The Recipients Of Care

Skip Snow

Everybody at HIMSS, the annual health care IT conference (http://www.himssconference.org/) is telling the same story. Regulations and the need to reduce the burden of healthcare costs on the American economy is driving innovation to more efficient models of care delivery. The engine behind this drive is a changing model of incentives that reward quality and punish uncoordinated poor-quality care.

                           

Mark Bertolini, CEO of Aetna (HIMSS keynote speaker)

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Australian CIOs Talk Agility And Collaboration In Sydney

Michael Barnes

Last week I hosted Media Corp’s CIO Leaders Summit in Sydney. In addition to my emcee duties, I also moderated two panels, both of which inspired significant discussion among the more than 50 senior IT decision-makers present. Highlights included:

  • Peter Bourke, CIO of Westfield, helped drive a lively discussion on the changing role of the CIO and strategies for leading innovation within the organization versus simply responding to business needs.
  • Andrew Wiles, CIO of Vodafone, addressed the importance of talent management and the skills that IT professionals require to succeed in a fast-paced business environment.
  • The CTOs of Avaya and Cisco provided excellent insight from the vendor perspective, while David Gee, CIO of Credit Union Australia, wrapped up the event with a vision of the future — the “microtrends and megatrends” likely to affect our lives, both professionally and personally.
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3D Printing Expands The Reach Of Digital Disruption

Michael Yamnitsky

2013 was a year in which media attention and hype targeted 3D printing: “artisanal” do-it-yourself (DIY) upstarts on Kickstarter making headlines across the blogosphere every week; high-profile speculation, such as President Obama’s quip that 3D printing will create a new manufacturing economy in the US; and Victoria's Secret models strutting down the runway in elaborate 3D printed corsets and signature wing accessories.

The excitement has reached the C-suite, where execs are wondering how this elusive and unfamiliar new technology will affect their business. As the resident techie, the CIO should expect the questions to come her way: What are the business implications? How fast is the technology developing? What are the implications for business technology at your organization?

Over the past six months, my colleague Sophia Vargas and I have been working to understand the trajectory of 3D printing and its impact on business and technology. Clients can read our newly released Forrester report 3D Printing Drives Digitization Further Into Products, Processes, And Delivery Models for our full analysis.

Here are three angles on how 3D printing is driving business impact and digital disruption:

1. 3D printing can create tremendous business value — today. 3D printing enables key business imperatives in the age of the customer: faster time to market, new products and new markets, and the expansion of personalized products or services.

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The Facebook/WhatsApp Deal Is Bad News For Telcos

Dan Bieler

Facebook’s purchase of WhatsApp shows that the market for messaging is far from dead. But it’s just gotten worse for the telcos. We’ve already discussed the underlying reasons in a report — but the fact that Facebook put $19 billion on the table, of which $4 billion is in cash, for a global messaging service with 55 staff should scare telcos, with their millions of employees and high-cost structures. Over-the-top communications tools like WhatsApp, Line, KakaoTalk, WeChat, and Viber (which itself was bought a few days ago by Rakuten) have pushed telcos further and further away from any meaningful customer engagement.

To be sure, WhatsApp is about much more than instant messaging; it’s about content sharing — which is an emotional activity. Such emotional activities are critical to closer customer engagement. As the online giants use ever more granular user analytics to cement their position as marketing powerhouses, telcos’ hopes of developing new revenue streams from analyzing user behavior are slipping away faster and faster. This is what makes the deal so dangerous.

Of course, it’s tough to justify the deal simply on the basis of WhatsApp’s revenue model of $1 annual subscriptions. In my view, the deal is really about:

  • Bringing a major competitor into your family. Otherwise, someone else could have lured WhatsApp into theirs. The deal, which accounts for about 10% of Facebook’s market capitalization, could be seen therefore as an insurance cover.
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Rackspace Starts A Process Microsoft Just Finished

James Staten

With Satya Nadella now warming the CEO seat at Microsoft, executive recruiters can shift their attention to another cloud leader — Rackspace — who bids adieu to its 14-year leader, Lanham Napier. While both companies are clearly cloud platform leaders chasing the same competitor, the similarities in the top job stop there. Rackspace's needs in a CEO center more around how it tells its story than concerns about its strategy. 

Where Microsoft is struggling to ensure its ongoing relevancy in a world that is shifting away from the desktop and the on-premise enterprise, Rackspace has strong cloud credibility. Its issues are more around the fact that it isn't a cloud pure play, isn't another managed services cloudwasher, isn't an incumbent enterprise IT supplier, and no longer runs OpenStack. So if you're looking for companies to compare it to in order to value its stock, there aren't good comparisons. And if you’re looking for metrics to use to judge its success, the ones being disclosed don't paint a rosy picture. If you want to understand Rackspace, you'll have to really understand the company and why it isn't what it isn't. So let's start there:

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Computers, Privacy & Data Protection Conference 2014: Embracing User Privacy As A Competitive Advantage

Dan Bieler

By Enza Iannopollo and Dan Bieler

The recent Computers, Privacy & Data Protection Conference (CPDP) showcased a series of innovative projects that are based on big data. Big data is one of the four imperatives that shape the age of the customer — one of Forrester’s main focus areas — and the changing regulatory framework of data protection in Europe has big implications for big data initiatives.

Central to data protection is the existing EU Data Protection Directive, which legislators have been trying to update for years to reflect the changing online realities. The proposed Data Protection Regulation focuses on a redefinition of the concept of “consent.” User consent now has to be freely given, specific, informed, and explicit.

This new definition forces businesses to be more transparent about how they gather, use, disclose, and manage customer data in the form of the principles of privacy notice and purpose limitation. Complying with these new privacy principles is a challenge in the age of the customer, as privacy regulation affects:

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Sharing Is More Than Caring: Shared Services Enable Public Sector Tech Upgrades

Jennifer Belissent, Ph.D.

As we all learned as kids, it's nice to share.  That holds true for public sector organizations as well, particularly in tough times. Public sector organizations don't have the privilege of dialing back on scope in challenging economic times. In fact, when the going gets tough, government organizations often have to kick into high gear. And that was the case with state unemployment insurance (UI) programs in the US, which saw spikes in applications when the economy slumped.  But in most states the technology infrastructure wasn’t up to the task.  

  • Legacy systems were on life-support... Colorado’s 25-year-old COBOL-based mainframe systems continued to process unemployment insurance claims, but it was increasingly difficult and costly to find the "doctors" to keep it alive. They had to bring developers out of retirement to maintain it.  State officials knew it was only a matter of time before they had to pull the plug on their system.
  • …and just weren’t up to the task. Not only did the “look and feel” leave a lot to be desired, the legacy system failed to deliver. The system ran processes in batch mode, meaning that data was typically collected over a period of time (daily, weekly, or monthly) and processed into the system at the end of the period. Daily downtime for processing excluded the possibility of 24-hour availability or even extended hours. The delays and lack of availability frustrated end users who wanted or needed real-time or near-real-time information to make decisions.
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Level-Up Your Mobile Engagement With Proactive Experiences

Michael Yamnitsky

Last year, we saw mobile apps getting smarter, tapping a wider range of personal data to anticipate and deliver in-the-moment needs before a customer takes action. Google is in the lead with Google Now, but Apple and Microsoft also signal interest in this space. Much like the VIP concierge services of major credit cards and airlines, these apps have the potential to form intimate customer relationships and increase affinity for products and services. And they are resetting expectations in a new paradigm we call the mobile mind shift — the increasing expectation of individuals that they can access any service, in context, in their moments of need.

You have an opportunity to play in the game, but to a different tune, one that enriches your brand by enhancing existing scenarios, engagement points, and relationships. 

In 2014 and 2015, we anticipate that customer-obsessed companies in verticals such as retail, finance, and insurance will introduce and develop proactive features in their mobile loyalty apps. CIOs should expect an influx of requirements from marketing peers leading such efforts. With the opportunities will come challenges on three dimensions: 

1. Business strategy. Proactive experiences can reap extraodinary rewards but can also lead to devastating consequences. For example, achieving 85% accuracy with your recommendation engine appears to be a success — until you consider the diminishing returns of a 5x penalty on trust factor for that 15% you got wrong. 

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Bosch Connected World - Internet Of Things Made In Germany

Stefan Ried

Internet of Things is a hype - no question. But let's talk about the INTEGRATION Of Things. 

It’s been a while since Bosch completed the acquisition of the Germany BPM and Integration vendor Inubit AG in October 2011. Two years later Inubit has not only well arrived in the Bosch Group, it became even the nucleus of Bosch’s allover software business and helps the traditional manufacturer of automotive parts and consumer electronics to embrace an additional business model of a software vendor.

Nevertheless calling the conference ConnectedWorld articulates the repositioning of the former general purpose BPM and Integration software into the internet of things. This is where Bosch with its dominant automotive footprint and their good market share of home appliance in Europe is strong. It is a natural move to focus Bosch Software Innovation’s in the areas of Bosch core business. In this context, it is no surprise that every second visitor of the show is a Bosch employee who likes to understand if and how their Bosch units can use the new software assets. Ideally this results not only in internal use, but in joint external products. Today the clear majority of Bosch's software revenues are external and not yet related to other Bosch products.

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