The fundamental technology value proposition is enterprise competitive differentiation and innovation. The value is strengthening the customer experience, enabling operational excellence, introducing disruptive products and services and driving infrastructure innovation. The key objective of a CIO is to create an environment of trust and transparency where technology continuously strengthens and improves its value proposition. This cycle of enterprise improvements, coupled with an active business feedback loop, enables technology to drive sustained and increasingly higher levels of business benefit. Given the potential for technology to energize an enterprise, what must the CIO do to amplify the technology value proposition in the Digital Age? The objective is to minimize noise and maximize value. Effective CIO's understand that it is people and relationships that ultimately drive digital technology forward. Managing IT like a business fosters trust and transparency, and establishes the key relationships that will provide sustained amplified benefit.
“It is through active engagement of people and relationships-internal and external to the enterprise-that ultimately drives the sustained amplification of digital technology”
The fundamental management functions of IT must be performed effectively, otherwise relationships will constantly be framed with an eye to both cost reduction and correcting perceived shortfalls—versus the technology value proposition. The CIO must ensure that core processes such as; governance and demand management, program and project delivery, financial management, technical services and infrastructure, security and overall enterprise architecture are performing efficiently. You need consensus that IT is operating effectively and to have established the trust that the people and processes are in place to keep IT performing well into the future. In a sense, excelling at the IT core management functions—that runs IT like a business, and represents the base of the IT Hierarchy of Needs. In the Hierarchy of Needs a higher level of need cannot be met before the fundamental needs are satisfied.
Operationally, CIO's must establish transparent IT governance across the enterprise so that valuable IT resources are working on what is most important for the enterprise. When transparency, trust and teamwork drive investment decisions and priorities, CIO’s can build relationships based on value and optimizing enterprise performance. Projects must be delivered on budget at least 90 percent of the time and rigorous IT financial management must provide regular financial and IT operational metrics. CIO’s need to know how the department is performing, but peers are paying close attention as well. Chargeback processes need to be fair and cost competitive with outside providers. Fundamentally, there must be a clear line of sight between investments in IT and business performance. In addition, the underlying technical infrastructure must be secure, scalable, and cost effective and support industry best practice reliability and performance standards. With this core in place, the CIO’s key internal and external relationships, in the Digital Age, can be based on sustaining the technology value proposition.
The CIO's key internal partners include; the CEO, CFO, his or her peers, and the IT staff. If you've already established transparent investment and governance processes, value metrics and security your relationship with your CFO is likely already well grounded. Like the CIO, the CFO would rather not talk about core IT management functions; he or she would rather discuss innovation and how technology can enable business transformation. A strong CFO relationship provides insight into future business strategies and trends and is an invaluable sounding board to ensure IT investments are aligned with business strategies. Technical innovation and investment can amplify business performance and scale when aligned with a supportive CFO. Business leaders want to have confidence that IT can deliver on what they commit to—basically providing excellence in core IT management functions. Business leaders are highly vested in enterprise initiatives, their resources are hands on and used in all phases of technology and they are directly impacted by the business outcomes. In short, business leaders have skin in the game while also having the potential to provide invaluable information about the market. The CFO and business leaders are the CIO's best source of performance validation for the CEO. The CEO relationship is most critical; the subtle difference is that is it often dependent on the independent feedback from other internal relationships. Effective relationships with the CEO positions a CIO—to provide reciprocal feedback for advancing Digital initiatives. In terms of the IT staff, strong relationships result in less attrition, a highly motivated team and greater empathy for the enterprise needs. These relationships can also yield further adoption of current technologies to drive enterprise value. IT talent drives relationships deeper into the organization and provides a higher value delivery stream. Talent obsession and mentoring is a critical success factor for CIO's. Talent at all levels contributes to running IT like a business. The mindset must be to continuously optimize code, projects, programs and platforms. These key internal relationships all drive competitive advantage. Similarly, key external relationships have the same ability to positively move the needle.
Key external partners include; Customers, Suppliers and Industry Peers. An effective CIO establishes relationships with customers to understand their voice and how technology can enable a better customer experience. Even indirect customers, that is, customers in the same vertical are a source of information and value. Suppliers create a broader IT ecosystem and are often can be leveraged to provide innovation and augment IT effectiveness. While strong supplier relationships can influence supplier roadmaps, the CIO must also understand where agenda's and strategic goals differ and how much risk a supplier represents. Establishing relationships with industry peers and forums is an excellent source of ideas, continuous improvement and technology trends. Each symposium, conference, or industry meeting/event can yield ideas to leverage.
CIO’s require management and relationship skills to sustain the technology value proposition in the Digital Age. It is through active engagement of people and relationships—internal and external to the enterprise—that ultimately drive the sustained amplification of digital technology.