As digital becomes central to achieving growth, organizations that are generally slow in uptake can still manage to realize reasonable gains if only they can adopt a fast-follower strategy; learning from the environment and  engaging in short but continuous digitization.

The advancements in digital technologies and emergence of new-age businesses have forced the traditional companies to rethink their strategies and defend their positions in order to survive in the increasingly dynamic and competitive environment. While the leaders among them have realized the need to reinvent themselves and become digital, many others have struggled to hit the right path and withered away in the market place. The reasons for the failures are many but the common ones are:

• Leadership disconnect – Inability of the top tier to comprehend the threats of competition and adequately connecting with their ecosystem to understand changes.
  
• Legacy drag – Compulsion to sustain archaic IT systems and processes that are high on maintenance and demand more management attention.
  
• Lack of champions – Dearth of brave hearts in the second line of leadership who can challenge the top tier/ Board on their outdated strategy and showcase the path to recovery.
  
• Siloed structures – Very functional and siloed organization structure that operating towards conflicting objectives thus preventing collaboration amongst the employees.
  

These negative forces weigh them down to be laggards in digital adoption and they tend to scramble to keep pace with the leaders. Instead of giving up, they can still recover and reap rewards of credible performance- if not superlative - if only they can adopt a smart follower strategy. However, this comes with a rider that they need to be FAST at that. Once they establish a momentum as a fast-follower, they can accelerate their digital quest and aspire to be among the leaders.

This article presents some actions companies can practice as a fast follower. Any business wanting to gather pace of digitization needs to strengthen one or more of the fundamental building blocks; a digital strategy that aligns with the overall direction of the company, market and customer orientation to understand and influence customer decisions, a collaborative culture among the workforce and an understanding of the applicability of digital technologies such as Cloud, Analytics, IoT etc. However, there are certain specific considerations fast followers should focus on to accelerate their digital pursuits.

Galvanize Support

The success of a fast follower strategy depends on, without doubt, the conviction of the CEO who is best placed to lead a digital transformation by setting direction and fixing responsibilities for actions. If the CEO is not on board, the battle is lost even before it has begun. He/she may, however, wish to appoint the CMO, CIO or any influencer to be the ‘chef de mission’ to take charge of execution. The first step is to build a small team –may be just 3 to 4 – of likeminded influences across functions that can together impress upon the leadership and peers to act. The team will be involved in all aspects of digital programs and involve their colleagues and subject matter experts as per need.

A blunder companies commit is to expect an individual such as a CIO or a management executive who may not have the authority within the organisation to spearhead the digitization. By appointing a small set of cross-functional influencers, the chances of furthering an idea to execution is much higher.  The team could make the right interventions and support each other to promote the ideas for organization buy-in.

Listen to the Environment 

Fast followers‘s strategy should be built on learnings from diverse sources.  Engaging with customers, connecting frequently with employees, observing competitors’ actions - not just traditional but also non-traditional, enlisting the industry experts, assessing the outcomes of digital ventures of leaders are crucial to constructing their own digital programs. These actions require one fundamental quality to be perfected – listening, a deep listening that goes beyond mere understanding but results in constructive ideas and plans.  Participating in industry events, focus groups and other platforms that bring leaders and experts together can be useful sources of inspiration.  The learnings will have to be contextualized to company’s needs and translated into actionable programs that feed into the Learning Lab.  

Institute a Learning Lab

Establishing a lab that actions on the learnings from the industry should be the next focus area for Fast Followers. The lab can develop prototypes of solutions or test third-party solutions to evaluate the fitment to the organization’s context. The lab can also be used to demonstrate to relevant stakeholders to get their feedback. It should be made to work with minimum resources to avoid high outlays. A common approach that can be considered is to run pilots using open source tools where relevant and move to enterprise specific products when proven.

Keep it Simple

Digital leaders tend to take high risks in improving existing solutions or deploying new ones in a ‘fail-fast’ mode and continuously augment their digital offerings. Followers may not have the organisation backing to take such risks. Instead they should execute short projects that are built and executed in multi stages than as a big-bang. Drawing from the labs, the team should cherry pick small bets that can leverage on the traditional strengths of the organization but brings in a digital swap.  They should showcase wins to gain more support from the management and the organisation.

Engage with the People

The success of digital programs hinges on acceptance of the employees and their buy-in can hardly be overemphasized. The senior management should be on-board at every stage. Towards this, the team should continuously engage with the key stakeholders; the management and the employees to enhance awareness, seek ideas and suggestions and encourage participation in the on-going programs.  The team may do well to consider deploying platforms that bring the employees together for collaboration and also bring in a sense of competitiveness among the functions. They should evaluate leveraging social influence and gamification tools to drive change in attitudes and behaviours by integrating such principles into the collaborative platforms.

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By continuously studying the digital successes of the leaders and contextualizing them for their businesses, fast followers can still achieve gains and be in a position to thwart competition reasonably well. The success lies in the perseverance of the fast-follower strategy and bringing changes that are in line with the organisation capacity.

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Change Management for a digital transformation can be more effective if it endeavours to go beyond achieving an ‘open mind’ (mindset change that emphasizes skill) to ‘open heart’ (that emphasizes will, an earnest desire to service and solve problems for the customers).

Today’s businesses are experiencing fundamental shifts around them as they encounter emergence of new businesses, changing customer preferences and surfacing of startups that threaten the established structures. Incumbents attempt to address these challenges by transforming themselves and increasing the pace of their digital investments, some succeed and some falter.

A crucial lever that determines success from failure of transformations is the way Change Management (CM) is orchestrated. However, it may be puzzling at times as to why even a regimental CM would come unstuck resulting in under-utilized investments or people reverting to old ways of working. As organizations learn from failures, it is being increasingly realized that for transformative programs like digital, companies should move away from conventional CM that is project based to a radically different approach of perpetual change.

This article attempts to illustrate further thinking on the approach to CM. True, businesses understand that in order to achieve transformation and embrace the new order, it is important to effect a mindset change among the workforce. While this intention is well placed, considering the moderate results, it may seem that this approach is inadequate.  Can they do more? Possibly yes.  Companies should strive to move from merely effecting a mindset change (the skill that opens their mind to new possibilities of business) to achieving a heartfelt change (the will that opens their hearts to servicing their customers).

Why is the need to transition from just a mindset change to heartfelt change? Traditional CM tends to largely emphasize the ‘technical side’ of the transformation that covers the business processes and technology enablement. While the relevance is understood, the question is whether they actually inspire the workforce to portray the sincere desire, the willingness and the empathy towards servicing their customers.

When customers are spoilt for choices, companies can hardly afford any gaps in overall experience across brands, functions and even geographical locations. They try to do the impossible of achieving standards of operations across these areas and hence design CM to promote the standards. Instead, if CM effort is oriented towards encouraging an ‘open heart’ culture that is people centric, employees will find ways of localizing them towards serving their customers.

Traversing from Open Mind to Open Heart

The journey from Open Mind to Open Heart is complex. How can companies guide their employees in this transition? There are atleast 4 fundamental shifts they need to accomplish. 

Shifting to Synergized Working from Siloed operations

When companies invest in transformation engagements they attempt to perfect the different functions of the organisation such as sales, customer service or logistics. In this quest, they tend to trip on the much needed co-ordination among these functions.  When the coordination fails due to lack of information or poor understanding of the problem, even the well designed customer-centric strategy would fail leading to dissatisfaction and churn. 

As customers, we may have experienced co-ordination gaps in our own interactions with our service providers.  We have may have had excellent interactions when our transactions fall into regular categories but seen it reverse when we report a problem and trying to get it solved.  We would wish that our service providers put more ‘heart’ to solve the than leaving us in frustration.

CM should encourage appreciation and learning of challenges of peer functions and more importantly inculcate willingness among the teams to move across functions or to collaborate to solve customer issues. This could sometimes require the individual functions to give up their metrics and work towards the tasks on hand.

Elevating to Empathizing from Engaging with Customers

As noted earlier, digital investments tend to over emphasize the business and technical side of the implementation and assume that the attraction of new technologies is enough to motivate the employees to change. The higher dose technicalities force employees to follow pre-defined scripts –newly developed possibly – than acquiring capabilities to deeply understand customer situations. In other words, the employees are trained to ‘engage’ with customers more efficiently than ‘empathize’ with them to understand their needs.

CM interventions should attempt to bring a perpetual shift that is high on empathy and educate the employees to look at issues from customer perspectives and their own roles from customers’ point of view.  Empathy encourages adopting different approaches and levels of interaction for different customers. A fundamental quality that helps in empathy is listening – one of the most undervalued skills.  A good listener would know when to stick to the script and when to move out to service a need by bringing necessary resources to the table.  Organizations would do well to encourage listening together as a team to a customer complaints or requirement in order to solve them and more importantly collectively learn together.  

Empowering to Taking Decisions from Escalating Issues

When over standardization translates into capabilities, the employees would hesitate to move out of the script and simply escalate to the higher levels. The employees should be empowered to make decisions, say in customizing or providing solutions to the customers.  Moving away from standardization should be encouraged within a overarching but flexible framework. In the long run, companies would realize that local decision making will eventually be more successful than global standards.

Towards this, CM should structure teams in a way that brings them closer to the customer.  Customer proximity should be enabled by technology such as social media analytics, customer journey mapping etc.

Moving to Bottom-up from Top-Down Construct of Changes

Customer centricity would remain just a slogan if the employees were not accustomed and trained to act in a truly customer-centric way. To bring about a change, employees should be allowed to be willing participants in the planning and encouraged to devise ways of servicing the customers.  Including the employees in designing CM programs by putting them at the centre of the strategy and allowing them to own the execution can help overcome their resistance and arduous nature of change. 

Achieving these Shifts

The journey to move from ‘open mind’ to ‘open heart’ is never easy and the rallying cry must start from the top.  The leadership should be united in the effort and reiterate the purpose and engage with employees as often as it could. Companies should follow certain general principles  that include but not limited to direct involvement of leadership, an effective employee engagement, social influence and appropriate technologies need to come together towards achieving the shifts.  The employee engagement should take centre stage and the CM should include employee-wise development plans, team workshops and identify and resolve conflicts.  A weekly if not daily debriefing on the quality of customer interactions that highlights the listening aspects, dialogue and outcomes across all levels of the organization would help further nurture the desired behaviours.

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In order to keep pace with dynamics of the digital world, organizations need to adopt new ways of managing transformations and driving the change within. They need to enthuse and empower the employees to move closer to their customers and encourage being more empathetic to their needs.  Achieving such behaviours require altering fundamental structure and traits of the workforce and bringing new norms of working across the organizations. Skills (open mind) are no doubt critical but more than that the will (open heart) to service customers is crucial to lead in the digital era.

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Digital efforts due to their profound impact on business landscapes require establishing a Board Committee with a mandate to guide the company’s strategies and govern the realization life cycle spanning opportunity identification, investment decisions and implementations.

Businesses pursuing a strong growth agenda are realizing that technology is inextricably linked to their actions on the ground.  Their business strategy and technology strategy are increasingly becoming indivisible as they attempt to harness IT solutions to effectively compete and sustain growth in the market place. A study by Gartner on CEOs’ priorities for next two years indicates the importance CEOs have placed on technology.  In the study, IT is ranked 5^th surprisingly ahead of profits and new product that are ranked 6^th and 8^th respectively.

There is no industry that has not been impacted by digital. The intensity may vary but not the intent. Companies can hardly take a ‘will not affect us’ position when they witness changes around them. Hence, it is impinging on them to be pro-active and continuously reshape their strategy fusing strong business models and impactful technologies.

As digital takes the centre stage in the strategy conversations, companies try to ascertain who should lead the digital programs; whether it is CEO, CMO or CIO or the need for a new role like Chief Digital Officer and who the principle stakeholders are. However, while this debate gets traction, one group of key stakeholders does not seem to appear frequently in the deliberations; the Board of Directors. The Board’s involvement seems to be largely limited to providing approvals for digital investments and possibly review them if they come up during Board meetings.

When we try to investigate the extent of Board’s involvement, a quick scan of the constitution of the Board of a few randomly picked companies, would tell us that most of them, including a few leaders, do not have a Board committee for technology. While it is common to find committees for Audit, CSR or Shareholder Relations there is not one for technology and /or innovation. There could be reasons that are legacy related but as the businesses are increasingly driven by technology, one wonders whether the Board should play a more active role than be a passive participant. Consider the following:

• Technology is no longer seen as a mere enabler of business process but a strategy that can shape and employ new business models
  
• Nimble and new age competitors that have technology as the core of their businesses have the potential to disrupt the incumbents to the extent of even marginilising them in the market place
  
• Relationships with customers and vendors are increasingly determined by technology savviness than purely based on traditional strengths like brand or products.  A study by McKinsey suggests that about half of M&A successes depend on IT, which emphasises the strategy play of IT.
  

Given the high stakes, the rationale for the existing committees could well be applied to justify the need for a technology committee or better, a broad based digital committee. It can be modeled along the constitution of other committees with an aim to provide guidance and conduct periodic reviews of the digital programs.  The charter of a Board committee normally covers the mission, membership, meeting frequency and duties and responsibilities. Let us see how these apply to a digital Committee.

The Mandate

The mandate of the digital Committee would be to assist the Board and guide the company in the digitization efforts.  The committee can support the executives to strategise transformative digital programs to be an early mover in the market or quickly respond to competitors’ actions that may threaten the company’s position. The role of the Board committee becomes more prominent for small and mid-sized companies that may lack credible leadership across levels and resources to pursue successful digital programs.

Membership and Meetings

The committee should ideally be chaired by an independent director in the Board and can consist of fellow directors with need based support from executives. They can enlist experts and consultants to guide them where required. The committee can work with a structured plan that can act as a baseline and meet as frequently as possible with agreed minimum number of meetings.

The Responsibilities

The digital Committee needs to focus inter alia on 4 areas:

1. Digital Strategy

2. Portfolio Management

3. Leadership and Resource Management

4. Program Management

Digital Strategy - Asses Strategic Importance of Technology

A starting point for the committee could be to measure the effectiveness of existing technologies in their capability and flexibility to address the current business issues, respond to changing market conditions and scale up for future possibilities. The committee should guide formulating a digital strategy that can propel the company into the desired growth trajectory. The committee should also help move the strategy exercise beyond the CIO’s office by encouraging organization-wide participation and enlisting customers, business partners and industry experts where required.

The committee should continuously challenge their CxOs to ably leverage technology to further gains in areas such as business performance, employee comfort and customer satisfaction.  Their readiness should be measured against the new-age or technology savvy competitors’ efforts that may have the potential to threaten the position of the company in the immediate or near terms.  Armed with such reviews, the committee should periodically monitor the progress of technology strategy execution and ensure alignment and refinement to the changing business contexts.

In short, the committee should direct digital strategy in the following ways:

• Establish a ‘Digital Maturity’ scale that can reflect company’s position and market actions and that can measure the effectiveness of the current usage of technology and plans for the future.
  
• Collaborate with the leadership team, customers and business partners  to jointly formulate or refine technology strategy
  
• Periodically review the technology strategy execution and jointly address implementation issues.
  

Portfolio Management- Construct a right portfolio of digital programs

IT Portfolio management would typically mean optimizing the IT assets of the company by refreshing the portfolio through introducing or dropping IT assets due to technical reasons such as obsolescence, scalability etc. Such decisions normally fall in the domain of CIO. However, companies need to take portfolio management to a more strategic level where the decisions are based on business imperatives and future demands. This is where the Board committee can step in and guide the executives.

In most organizations, a substantial portion of the IT budget, even to the extent of 70% go to maintenance of existing IT assets and the rest on fresh investments. This undermines the company’s ability to explore and invest in future-ready technologies. The Board should guide the company to swap the ratio in gradual manner.

The future-ready can be looked at in two categories – the near future state and future state; the near future state is those technologies that have been proven but not yet part of the mainstream usage. An ideal company would have tested and accepted prototypes or already using these technologies in a small way. SMAC stack can be a good example for this category. The future state is the technologies that are in early stages of development, not yet proven but the company can start building prototypes. A good example could be IoT or Cognitive solutions. The Board would need to ensure appropriate investments in the future technologies while optimizing the spend on operational systems.

To summarise,  the Board’s involvement in this area could cover the following:

• Ensure the company bets on immediate and future technologies
  
• Budgeting that  commensurate with the bets
  
• Align performance measures and reviews to the investments
  

Leadership and Resourcing- Enlist right owners and adequate resources empowering them for success

Some companies still see digital as a technology foray and any attempts on digitization land at the door of CIO.  A seasoned CIO could be qualified to lead digital programs, however it may not always be effective as digital is often and should be deeply welded into the differentiators be it customer service, marketing or operations.  Hence, in order to realize the intended benefits and to fix end-to-end ownership, the efforts may need to be led by the most appropriate head. It could be function heads such as the CMO or Chief of Operations by a CDO.

The Board Committee is best placed to formulate guidelines on ownership and governance for digital programs that can cut out layers of decision making and minimize ‘baton-passing’ risks. The framework thus developed could empower and encourage the right owners to lead and navigate through the complexities of business models, technology and people alignment. A number of digital programs may need to be executed rapidly to either grab an opportunity or solve a pressing problem. Such fast paced moves bound to have their share of missteps, hence it is important that the framework encourages owners to take risks without the fear of failures.  The Board may choose to intervene to sufficiently resource the programs to ensure there the programs do not face any hurdles.

Hence, the Board can assist in the area of leadership and resourcing in the following ways:

• Formulate guidelines and mechanisms to plan and execute digital programs
  
• Bring in the right leadership to own the programs and ensure adequate resources to support the programs
  
• Evaluate business case and approve investments
  
• Help bring an high performing culture and encourage the teams to take risks and not intimidated by failures
  

Program Management – Provide for execution oversight and course corrections to ensure benefit realization

Execution is where the rubber meets the road and comes with inherent risks due to complexities involved. Many technology projects fail due to increased costs, inordinate delays and poor outcomes. According to an Oliver Wyman analysis, the world’s largest 500 com­panies lose more than $14 billion every year because of failed IT projects. 

The Board has to take active role in reviewing the progress of the digital initiatives periodically and ensuring the value is realized on the investment.  Where possible, one of the members of Board digital Committee can be drafted into the Steering Committee of implementation projects to monitor the progress and intervene when required.

Digitization is generally an enterprise-wide effort and depending on the areas could also focus on extended enterprise involving business partners and customers. The transition could be quick and may disturb the existing structures and positions.  Hence, driving change is crucial to achieve desired results.  The committee needs to strategise change management programs, communicate frequently with stakeholders to demonstrate that they are fully behind the initiative and ensure participation across groups. 

Most companies miss out on learning and gaining knowledge. What one arm of the organization does is not known to other arm. It is critical to bring in a learning culture in the company to know what works and what doesn’t and use the learning to improve in the execution of digital programs.  The Board committee should address this common flaw and force executives to share experiences across functions and group companies.

In short, the Board can involve in execution in the following ways:

• Measure value of incumbent IT projects and ensure they are in right track, adjust project mandates on the fly to suit business conditions
  
• Drive change, connect with stakeholders more frequently to know their feedback and ensure course corrections
  
• Encourage organizational learning that cuts across past and on-going programs
  

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The responsibilities outlined may indicate a higher involvement of Board in areas that normally fall in the executive domain. So do we expect the Boards to be more ‘hands-on’?  To what extent can they question and challenge the plans and proposed decisions of the executives?  The answer lies in recognizing what digital can bring in. It can both be an opportunity and a threat; when pursued incisively by the company it has the power to shape the business for the future, on the other hand competitors can potentially destroy the position of the company by their calculated moves.  The companies thus face opportunities beckoning growth on side and threat of even closure due to early start competitors on the other side.  Because such changes are rapid, Board’s direct involvement will ensure that the company’s sails are set in the right direction to navigate through a rough and highly competitive business environment.   

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As the CIOs prepare themselves to play a more strategic role in the Digital world and become part of the C-suite, there are certain traits they need to develop and practice to make a meaningful contribution to the direction of the businesses. 

According to some experts, the title CIO was probably created in late 80’s / early 90’s. The Chief in the tile reflected the growing importance of the position, a marked change from other tiles like IT Manager or IT Director given to IT heads, as companies started recognizing the role of IT in their businesses.  The title meant that the position would have same level of influence in the organization as the other ‘C’ level positions, like CFO or COO had. However, for inexplicable reasons, the role did not live up to that expectation.

The developments in technology in the 90’s had considerable influence in managing the businesses  as companies moved from largely manual operations to centralized data processing and further to networked enterprise applications. IT was becoming more integral to the business. CIOs have always front-ended these initiatives and though one may argue these were not transformative in nature, companies did benefit to a large extent. Despite such achievements reaching the top echelons of the organization eluded the CIOs.  In some organizations, the role reported to another CxO (CFO in most cases) and not to CEO.  Not many companies bothered to invite their CIO for a strategy discussion and worse still there was still a certain degree of distrust towards technology and CIO in particular.

The digital era we witness has once again turned the spotlight on the CIO possibly more sharply this time. Companies are increasingly recognising the true potential of IT to navigate the business uncertainties.  The advancements in technology such as cloud, mobility and analytics coupled with success of ‘digital’ businesses have compelled companies to look at IT more strategically than ever before. If there is a radical shift that defines IT then it is its leverage to power revenue enhancement than the traditional cost containment.  In this transformation, it is only natural that the CIOs occupy the centre stage as they understand where technology can meet the business and thus potentially step up the pace of the change. As a consequence, the IT box buried under Finance or operations in the company map suddenly seem to get the arrow pointed from the CEO.  Board invites CIOS for PoVs,  CxOs expect CIOs to energize the strategy deliberations and the business divisions that were treating IT at arm’s-length now look up to their CIOs to realise their departmental goals.

Not all CIOs are primed for such higher stakes.  Some CIOs  easily make this journey because of their inherent leadership qualities but most find it difficult. What can CIOs do to stand up to the expectations?  How can they prepare themselves to perform a role that will become highly visible at every major decision?

This article presents a few suggestions to the CIOs to navigate the route and become an integral part of the C-suite.

Common C-Suite Traits

Before we discuss specific actions for CIO, it may be worthwhile to look at some common traits of C-suite leaders. Borris Groysberg et al, in their HBR article ‘The New Path to the C-Suite’ share a few. They say that the C-level executives have more in common with their executive peers than they do with the people in functions they run.  Not only are they expected to support the CEO but also when required challenge and contribute to key decisions. At that level, the technical and functional expertise matter less than the leadership skills and strong grasp of business fundamentals.

A study conducted by the same author on the most prized skills of a C-Suite executive listed a few common ones – (a) strategic thinking and execution – the ability to think on a global level and have unwavering focus on execution (b) deep familiarity with a specific area of operations , in areas like manufacturing, markets, financials or even technology (c) team and relationship building – building and leading teams and working collegially (d) communication and presentation – possessing the power of persuasion and achieving organization buy-in and (e) change management – the ability to lead change transformation. Additionally, the study indicated traits such as integrity, ethical conduct, inspiring leadership are highly valued.

CIO in C-Suite

If the CIOs have to play the role of strategists and influencers in their organizations, it is clear that they need to imbibe the traits of C-suite executives, draw inspiration from successful leaders, learn from their thinking and actions and adopt the learnings in their areas of operations.

There are four transformative traits that can help the CIO in his journey to be part of the leadership circle. These are:

1.  CIO as a Business Proponent-  Ability to look at the business holistically and into the future

2.  CIO as a Team Builder - Ability to build and sustain a high performance IT Organization

3.  CIO as a Risk Taker - Ability to place bets and prove outcomes

4.  CIO as a Learner - Ability to invest time in enhancing  personal proficiency

Not all these traits can be gained academically by attending a few training programs. CIOs have to demonstrate through sustained actions and prove their capability to the leadership.

CIO as a Business Proponent

CIOs should gain the ability to view and analyse business holistically across functions and operations. They need to understand the current business imperatives and the future direction and pro-actively assess how they can build the bridge to the future through technology.

Participating in Business Reviews - As a corollary to the above, CIOs should offer to participate and contribute to the business reviews by sharing their observations of business and making presentations on the companies’ performance as supported by the data.  During the meetings, it is important for the CIOs to see the situations from the business point of view than the comfortable technology view and make recommendations on possible course of actions on the business front. It may be difficult to convince the business leaders and be recognized as a serious contributor in the initial stages, but a relentless persuasion using data can change the minds of the leaders.

CIO as a Team Builder

If the CIOs have to focus more on strategic affairs, they have lay the foundation and build a strong IT organization that can run efficiently and manage the regular demands with little supervision. IT delivery is always a team work considering the range of skills required. Poor team structure leads to inept resourcing, inability to resolve operational issues and other risks reducing the CIOs to fire-fighting mode and severely restricting them to do justice to their ‘C’ tag.

Running IT department as a business – CIOs should attempt to run their departments like a business right from developing a vision, formulating and communicating clear objectives, documenting the business plan, following consistent measurement systems and all the works. CIOs also need to publish the monthly / quarterly performance for the stakeholders to communicate the hits and misses of the department.   Another important indicator of the way the IT organizations function is how the IT budgets are structured. There have been a number of studies which point out that more than 70% of the IT costs are spent on maintenance of existing systems leaving a much smaller share for future requirements. If their organization suffers from this issue, the CIOs should make effort to swap this ratio as early as they can. They need to re-orient their approach to budgeting and evaluate measures towards running the existing operations tightly and investing for the future.

Building a high performance team – A team that is self-sufficient and empowered can relieve the CIOs from the daily chores. An approach CIOs could consider is structuring the team differently for the current operations and the future requirements. The ‘Run’ team (managing current operations) would stress on governance, risk mitigation and continuous improvements. The team for the future would be more risk taking, working closer with the business functions and willing to experiment. Overall, the CIOs should bring in a culture of ideation, customer orientation and knowledge sharing.

CIO as a Risk Taker

A key characteristic of C-Suite leaders is their ability to take risks and lead from the front on new initiatives.  For companies, the digital transformation is about placing bets on a number of technologies that are in the offer and choose the right mix and scope of such technologies. CIO is best placed to explore and bring these technologies to the business. There may be many first time attempts which may not provide the required results and thus may require multiple trials. CIO should take such risks considering that the value of successful attempts even if they are small in number will far outweigh the value of large number of failed attempts. Most CIOs are normally tuned to taking up safe projects that are proven in the industry and taking bets is not natural to them.

Gaining Value by Loosening Control: Many CIOs still believe having direct control on IT assets is key to managing them well and probably to their survival.  They wish to own the software, locate datacenters in proximity, restrict access to data, have their team working under their eyes and get involved in procurement of all IT needs. However, as the technology becomes more pervasive and widely spread-out, decentralizing is crucial to get the best results. CIOS should identify areas where decentralizing can help, establish guidelines and facilitate business functions to support themselves to the extent required.

Bets on Automation: The availability of multiple technologies across the operating spectrum has provided the organizations the tools to drastically enhance the automation levels and reduce manual dependencies.  The options can be overwhelming and risky but CIOs should make those bets and move into a continuous  process of prototyping and rollout across these technologies instead of waiting for them to be proven in the industry and taking them in a bing-bang’ approach. They also need to learn to put together a business case quickly for the changes they propose and continuously evaluate the results against the business case and take corrective actions.

CIO as a Learner

The most important quality among all is the ability of the CIOs to push themselves on to a continuous learning path. On one hand we see the business getting more complex and dynamic and on the other hand, we see an exponential change in technology.  Some get hyped and die soon and some really prove their worth to the business.  CEOs and CxOs often turn to the CIOs to get their perspective on what will work and what will not for their businesses. Only a continuous learning process will help to be on top of the situation.

CIOs need to dedicate a few hours every week towards learning the business and technology developments through primary and secondary sources. It may help to have clear learning goals and plans not just for them but also for their team members.  The advent of MOOC, for instance has transformed the learning process offering a number of courses on business and technology and a majority of them free. 

Strengthening the fundamentals – CIOs need to invest substantial time to strengthen their business fundamentals and they can do this by seconding themselves to work in another function. Most of the time, their knowledge of the business is based what the functional people say than what they themselves experience.  They could spend a few days in Sales to understand say customer journey cycle or with supply chain to know the distribution challenges. They have to pro-actively seek time from other CxOs for one-on-one sessions for a constructive exchange of ideas on business and technology and in the process figure out ways to power business through technology.

Developing Technology Proficiency:  CIOs should keep track of the progress of their domains in the industry. There are a number of ways CIOs can equip themselves with the developments. Industry seminars, CIO forums and peer groups discussions provide great learning experiences.  CIOs should encourage his team to build knowledge portals and share their learnings and articles of interest. There is a tendency to learn through ‘trial and error’ which may be individual oriented have a high rate of ‘giving up’, instead CIOs should move their team towards a group learning process and be themselves active in that learning circle.

Developing Personal Proficiency: As the CIOs will become key influencers, it will help their cause if they consciously develop in them certain fundamental skills that make c-suite executives stand out. Clarity in communication, compelling presentations, preparing clear business cases, being ease with numbers are some traits commonly observed among the C-suite executives.  This is important for the CIOs as they present business cases, they need to avoid technical jargons, use the business taxonomy and more importantly articulate the business benefits than technology specifications.  Further, managerial skills that a CIO ought to be proficient in, like stakeholder management - understanding their positions and converting the opponents –change management, program management continue to be critical qualities that CIOs should invest further. 

Character Shifts

So, here is a summary of what can be some o f the key shifts for the CIOs:

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It is indeed an interesting time to be a CIO. The renowned computer scientist Ray Kurzwel  said in the beginning of this century that the progress in technology in 21st century will be more like 20,000 years of progress at the prevailing rate that time. He defined it as ‘Law of Accelerating Returns’ where the ‘returns’, be it chip speed or cost effectiveness would increase exponentially.   As the technology is making deep inroads into businesses, CIOs are best placed to bring about the changes rapidly and effectively.  Locking the opportunities coming their way and being the one to take the initiative and risks, would make the CIOs central figures to orchestrate the business transformation and be recognized as one among the C-suite  leaders and move further to become part of the Board.

In the article “Unlocking the performance of a CIO”, the author Joe Peppard quotes a CIO who urged other CIOs to ask this question, “ Are you a business leader with special responsibility for IT or are you an IT leader delivering to business”.  The time has come for the CIOs from being the latter to becoming the former.

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