uGovernIT

A Practical Approach for IT Governance

Posts Tagged ‘Future CIOs

Think like a CDO – Act like a CIO

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Businesswoman giving business card to client in office

Background

In two previous blog posts, we discussed the career of the CIO: “The  Six Stages of the CIO“,  I had suggested a six stage process:  Learn, Grow, Leap, Mature, Become Stable, and Share!   This was great if you just wanted to end the career as a CIO.  In a follow up to this blog post, CIO: Chapter 2, I proposed roles such as  CIO/COO, CIO/CFO and even CIO/CMO.  I always admired these lucky CIOs as they broke away from the mold.  Some suggested that I had missed an important alternative – the Chief Digital Officer (CDO).

The Role of the Chief Digital Officer

When organizations did not understand technology, they responded by creating the position of the Chief Information Officer.  The CIO was the bridge by helping businesses communicate their technology needs and helping IT align the resources to match those needs.  Many of the CIOs focused their attention on execution.  This focus on execution meant that CIOs were slow to respond to the Digital Enterprise.  Organizations responded by creating the CDO.   Many CIOs disagree with this approach. While most recognize the need, CIOs argue that the CDO should report to the CIO.  Sadly, the CIOs are losing. More than 80% of CDOs report to the Chief Marketing Officer (CMO).

Can the CIO also be the CDO?

CIO Executive Council (CEC), and yours truly, had the pleasure of interviewing Ashwin Rangan.  We asked Ashwin “There’s been some talk and more than a few articles concerning the current importance of the Chief Digital Officer. However, there is some speculation – even from CDOs themselves – that the need for such a position may be temporary as digital expertise and knowledge spreads across the C-suite and a company. Do you have any thoughts on that?”

In relationship to the CIO, Ashwin opined “To me, logic would argue that if the CIO is fully glued into the business of the organization, then the CIO ought to be the chief digital officer as well, because nobody understands the digital technology aspect as well as the CIO. The question that is being asked is who best understands the impact of the application, not the application itself. So, whenever there is a business-savvy CIO at the table who can understand and articulate the impact of digital technology as opposed to the application, I don’t believe there is a need for a separate Chief Digital Officer.”

 Reflections

At first glance, we may argue against Ashwin’s position.  The CIO has way too much on the plate, and the CDO’s role will only complicate things.  Upon reflection, Ashwin is right on the money.  The technology wave Analytics, Automation, Cloud, IOT (Internet of Things), Mobility, and Social Computing , have enabled enterprises of all sizes to embark on a journey where technology and core business are inseparable.  The CIO has to think about it anyway.

Let us look at it from the mid-market CIO perspctive.  Mid-market enterprises need an entrepreneurial individual who understands the technology and the business.  The key differentiators between the CIO and CDO are how they approach a technology solution.  CIO approaches it from the position of alignment to business, efficiency and risk aversion.  The CDO approaches it from the position of disrupting the market with innovative solutions.  These solutions have to be aligned to business, be efficient and low risk.   The CIO thinks top down, and the CDO thinks bottom up.  Therein, you have the answer.  Therefore, you can also be the CDO if you can think like a CDO, but act like a CIO.

Written by Subbu Murthy

April 28, 2016 at 6:35 am

The Digital Enterprise and Shadow IT: A Management Enigma!

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Background

We have all experienced some shades of shadow IT.   Gartner shared some facts at the recent CIO Summit in Orlando. In 2005, CIOs controlled 70% of IT, now they control only 58% and in 2017 they will control about 50%.  Is the growth of the Digital Enterprise a major contributor to this shift? This has led to a flurry of discussions and questions:

  1. What is the cause for this trend?  Why has the CIO lost control of IT Spending.  Is it Cloud computing, SaaS models or the push towards the Digital Enterprise?
  2. Do we encourage this trend or impose a rigid IT Governance framework that brings all control back to the CIO?
  3. If we want to encourage the trend, who should control the IT spend not controlled by the CIO?  Should we leave it to individual departments (aka shadow IT) or should we create a new position? Or should we revert to the CFO as the arbitrator?

The New Governance Model

There are no clear answers. Some argue that the reason for the shift in CIO spending is the emergence of inexpensive cloud based applications, and innovations such as autonomous robots, Internet of Things and 3-D Printing  that has led business units embrace technology easily.  Some argue that it was not the technology shift that caused the CIO to lose control, rather, it was the lack of response from the CIO that caused the business units to embrace technology on their own.

The second argument has more teeth in it.  The paradigm most CIO’s use is top-down.  Nothing wrong with it, except that the innovation is not just happening top down.   Innovation is also, in fact more often than not, happening bottom up.  Users are demanding more and oppose any structure that inhibits them.  Top down models focus on data and users focus on experience which are workflow-centric.  Therefore organizations will lose out if they do not encourage innovation.

Was the CIO a tortoise or did the technology move fast or both? In a broader sense the argument is irrelevant.  Irrespective of the cause of the shift, be it the slow CIO or rapid technology shift, the outcome is clear.  The Digital Enterprise is real – it is only a matter of time.

The Chief Digital Officer

When organizations did not understand technology, they responded by creating the position of the Chief Information Officer.  The CIO was the bridge by helping businesses communicate their technology needs and helping IT align the resources to match those needs.  Many of the CIOs focused their attention on execution.  This focus on execution meant that CIOs were slow to respond to the Digital Enterprise.  The organizations responded by creating a new role – the “Chief Digital Officer (CDO)”.  Many CIOs disagree with this approach.  Ashwin Rangan, Chief Innovation Officer & CIO at ICANN, and former CIO at Edwards Life Sciences and Walmart, opined “To me, logic would argue that if the CIO is fully glued into the business of the organization, then the CIO ought to be the chief digital officer as well, because nobody understands the digital technology aspect as well as the CIO. The question that is being asked is who best understands the impact of the application, not the application itself. So, whenever there is a business-savvy CIO at the table who can understand and articulate the impact of digital technology as opposed to the application, I don’t believe there is a need for a separate chief digital officer.”

Relationship to the CIO

If we accept the role of the CDO, many believe that the CDO should report to the CEO and be independent of the CIO.  Not everybody agrees:  Janet Schijns, Chief Marketing Technologist, Verizon shared the view that if there is a Chief Digital Officer, then the CDO should report to the CIO.  Her rationale was that IT Governance was extremely critical and the core values of security, information integrity and quality of IT cannot be overlooked. There is considerable merit in this argument – imagine what would shadow CFOs do to the integrity of financial data.

Conclusion

Organizations need to be nimble, alert and innovate. That said, if it is the CIO who is responsible for technology, then the CIO should be responsible for all aspects: Keeping the Lights On, leveraging technology to increase revenues and decrease costs, and foster innovation. The CDO may just be a function like the CISO reporting to the CIO.    On the flip-side, the CIO should be some combination  of a business genius, technology wizard, a benevolent leader, a great communicator, and to be a bit cheeky, automate routine management functions using tools.

Written by Subbu Murthy

October 20, 2015 at 8:09 am

Posted in Helping CIOs, IT Governance

Tagged with ,

The C-Suite needs to wake up to the Digital Age!

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Background

At the Avasant CIO Digital Connect in Washington DC earlier this month, Kevin Parikh, CEO of Avasant,remarked “Today’s digital technology options are creating opportunities for government and corporations to be more nimble and better serve their constituents”.  He then posed a question to us (Jay Ferro, CIO, American Cancer Society;  Vivek Kalra, Senior Vice President, Tech Mahindra; and Subbu Murthy,  CEO, UGovernIT) sitting on the panel:  “How does digital innovation impact how we design and deliver technology to the Enterprise?”

The Old Paradigm 

Over the past decade, many IT Advisers, including yours truly have been canvassing the idea that IT needs to be aligned to the enterprise, IT should be an enabler, IT should be scalable, flexible, so on and so forth.  In an earlier blog post,  I identified that for the CIOs to run IT as a business, they need to develop an IT Governance mechanism that covers four key aspects:

The first and the most critical aspect is safety and security of the enterprise. This implies providing a scalable, reliable, and secure Enterprise Architecture.  It should be pointed out that the Enterprise Architecture is not just technology components, but using a framework like Zachman, it encompasses people, process and technology.  While cost efficiency, getting value out of IT and innovation are essential components of aligning IT to business, these do not matter if the enterprise is at risk. Target, Home Depot and now Anthem Blue Cross serve as grim reminders as to how critical managing risk is to the enterprise.  So the first pillar in managing IT as a business is Security and Mitigating Risk.

The notion of shared services helps IT manage and deliver shared services efficiently. This helps IT leadership use the same service framework within the department and extend its use to other functions in the business.  The second pillar in managing IT as a business is Shared Services.

Since there is usually more work than resources available, one challenge is how to identify and prioritize the IT workload?  The most effective way is to proactively work with users to enhance the value of IT delivered.  Traditional project management tools do not address this interaction between users and IT.  The key to success is to bridge the IT-User-Executive gap by providing a practical, efficient, and most important, a non-onerous process of managing IT workload.  The third pillar in managing IT as a business is Effective Demand Management.

The CIO has earned the seat at the table, but will not be able to keep it if the CIO is not helping the Enterprise meet its Strategic, Operational and Budgetary Objectives.  This requires the CIO to be the change agent driving efficiency and innovation to the Enterprise.  This also requires the CIO to align IT plans to the business plans and pay close attention to IT spend versus value delivered.  The fourth pillar in managing IT as a business is Aligning IT Spend to Business Needs.

The Digital Age and the Paradigm Shift!

As I reflected on the impact of the Digital Age, I recognize that the paradigm CIO’s use is top-down.  Nothing wrong with it, except that the innovation is not just happening top down.   Innovation is also, in fact more often than not, happening bottom up.  Users are demanding more and oppose any structure that inhibits them.  If top down design worked, why did the Taxi companies not anticipate Uber? By no means I am suggesting that we abandon IT Governance. Nor am I suggesting we abandon traditional IT alignment models.  I am suggesting that we need to incorporate the users in the innovation cycle.  We have to abandon top-down only models and add the bottom up model that keeps the user experience as a key component of developing the IT architecture.  Top down models focus on data and users focus on experience which are workflow-centric.

Janet Schijns, Chief Marketing Technologist, Verizon shared a great example.  When she manages her flights via the web, there is great help in making reservations but very little that is beneficial to the experience of the specific passenger on the specific flight.  For example:  Did your luggage make the connecting flight?  If there are delays, how are you rescheduled?

A Sandwich Model!

Borrowing from an old design paradigm,  we have to switch from the top down design model to the sandwich model.  By no means the sandwich model implies that we abandon the fundamentals we have all learnt as CIOs. But it does mean that we have to actively incorporate user-centric workflows built on easy to use platforms as part of our IT architecture, manage risk (not design rigid systems that eliminate risk), allow users to innovate, embrace change rapidly and harness the rapid changes in technology.

Implications of the Sandwich Model

Not that I have the crystal ball, but I feel that the CIO’s role will be very different from the present.  While CIOs will continue to be the change agent, and the bridge between Business and IT, the role will shift to becoming the “hermit” who will facilitate innovation.  From a technology perspective, there will be a radical shift to mobile computing.  This will force a fundamental shift from large monolithic Enterprise Systems such as SAP to modular, workflow centric mobile applications.  I hope so, I have spent millions building technology on this principle.

Written by Subbu Murthy

October 11, 2015 at 1:55 pm

CIOs are judged by the Results they Deliver!

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Close up shot of a caliper, measuring the word "Results".

My very good friend, and advisor, Ashwin Rangan, pointed out that in the early stages the CIO focussed on what needed to be done. Later they recognized that processes were needed to deliver technology.  This naturally led to identifying the tools that helped them.  Today’s focus, Ashwin argues, is all about the results they can deliver.  We can use a three stage framework for understanding the paradigm shift:  Corrective, Preventive and Results Driven.

The Shift From Corrective to Preventive

Let us look at how we measure our delivery of services.  SLAs helped CIOs  identify process bottlenecks, and helped them make the necessary corrections to improve the timeliness of the delivered services.  Surveys helped CIOs improve the quality of the delivered services.  While this is great, it was a corrective set of measures – not preventive.    The old adage “An ounce of prevention is worth a pound of cure” had not lost its luster.  CIOs realized the need to empower their organization to take proactive measures to prevent/mitigate gaps in the delivery of products and services they are entrusted to manage.

It was no different when CIOs delivered major IT initiatives.  They identified cost and schedule variance, and took corrective measures when they were off-track.  While corrective measures improve how CIOs delivered technology to the enterprise, preventive measures help them deliver more for less.  As an example, look at traditional project management tools.  Initially, they focussed on using cost and schedule variance as determinants of project success. The key thing they missed was “scope management”.  Scope creep accounted for delays and cost overruns about 70% of the time.  Agile methodologies mitigated this risk to a large extent by delivering projects on a specific schedule by controlling the scope of the delivered product.

The Shift From Preventive to Results Driven

CIOs used ITIL, and ITIL based tools, to help them be proactive.   ITIL, no doubt a great framework, caters to the older school of process adherence.  Most of the tools that support the CIO are focused on process adherence.  But the real challenge was not delivering the project or service efficiently, but did the CIO deliver the results the enterprise needed?

What is badly needed is an outcome focussed tool that helps the CIO define and deliver results to the enterprise.  CIOs need to walk the talk – they talk about the role of technology in transforming the enterprise, yet they fail to use the tools internally.  In an earlier blogpost I identified that “We are so involved with day to day challenges, we seldom get the time to use some of the same tools we are delivering to our customers. The solution is quite simple – we should think and act like CEOs of an IT company. Using Key Performance Metrics (KPMs) to help manage your IT as an enterprise, IT Analytics provides you the ability to prioritize your demand and allocate resources that best serves the interest of the enterprise.”  

However, shifting to Results Driven management is much more difficult.  It requires that IT is aligned to the Enterprise, and more important, the Enterprise has not just accepted the CIO to sit at the table, but to listen and act on the CIO’s advice as well.

Written by Subbu Murthy

October 11, 2015 at 1:51 pm

Revisiting IT Analytics

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We are so involved with day to day challenges, we seldom get the time to use some of the same tools we are delivering to our customers. The solution is quite simple – we should think and act like CEOs of an IT company. Using Key Performance Metrics (KPMs) to help manage your IT as an enterprise, IT Analytics provides you the ability to prioritize your demand and allocate resources that best serves the interest of the enterprise.

From the IT perspective, Analytics can be classified into four types: Financial, Business Alignment, Request Source and Resource Analytics. Financial Analytics help understand IT using a Project Portfolio approach. Business Alignment Analytics focus on the value IT brings to the Enterprise. Resource Analytics helps understand how to deliver technology efficiently. Request Analytics helps identify the source of the technology needs and indicates the technology maturity of the organization.

As an illustration of the use of Analytics, consider the challenge of managing a portfolio of projects. It is very difficult to visualize the project performance without developing a common project assessment framework. Yet, common frameworks have the challenge that each project is unique and may have specific characteristics. To help resolve this issue, an IT Analytic can be developed to provide a project score. The project score can be used to assess the impact of the project using a Portfolio Management approach. Suppose we want to assess the project portfolio using a set of Financial Analytics. We can define each project using a common set of evaluators using measures such as budget variance, schedule variance, scope changes (“churn”), and also a set of measures that are unique to the project. These measures are weighted specific to each project but all contribute to a common scale such as 0 to 100. To illustrate the use of Business Alignment Analytics, we can use the same project portfolio, except the projects are now scored on the value they bring to the Enterprise and how closely they match to the business needs. Similarly, we can develop Request Analytics which essentially map the project scores to requesting organizations. Early stage companies may show a higher use of technology, say for example, in engineering and marketing to drive innovation and create demand, whereas mature enterprises will show a balanced use of technology across the enterprise. As technology is resource intensive, Resource Analytics (utilization and demand) are essential to triage and develop an IT plan that best meets the enterprise needs.

Using IT Analytics is a simple and effective mechanism to visualize each project in the portfolio. Clearly, the Project Portfolio Analytic does not replace the functions of the PMO, but facilitates management by providing a mechanism to quickly see trends and issues, and drill down to understand the direction and develop a IT strategic plan.

Written by Subbu Murthy

February 20, 2015 at 1:00 am

A Forum For CIOs and Future CIOs

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I was asked to chair a Business Forum for a cultural group from India.  It was a wonderful opportunity to reopen my network.  The Navika Business Forum will be held in Pasadena at the Convention Center on July 2nd, 2010. The Business Forum is under the aegis of Navika, a non-profit cultural organization.  It will provide an opportunity to showcase some of the project opportunities in Karnataka. Karnataka is a state in Southern India and is best known for its picturesque gardens and tourist spots,and the hub for aerospace, software industry and now biotechnology. Words cannot do justice to the great history, culture or the wonderful people who have made this state India’s crown jewel. 

It is an ideal platform to reach groups of people for furthering business contacts and business interests.  It has multiple tracks including the CIO Forum, Electronic Medical Records (EMR) Forum, Infrastructure Forum, and the Youth Entrepreneur Forum.  Leaders from the state of Karnataka and global entrepreneurs will be attending this event providing great networking opportunities for C-level executives and future C-Level Executives.  Budding CIOs will learn from experienced CIOs on what it takes to be at the executive table.

Written by Subbu Murthy

May 3, 2010 at 10:27 pm