CAMBRIDGE, Mass. -- The emergence of the chief digital officer in some enterprises has revived theory that the CIO role is doomed. But CIOs say that partnerships with CDOs, CMOs and other senior executives who own different aspects of the business are essential to fostering healthy digital transformations.
"You read the press [about] the rise of the CDO, the demise of the CDO, the threats that the CDO places to the CIO," said CVS Health CIO Stephen Gold, on a digital transformation panel at the MIT Sloan Symposium Wednesday. "But I don't see it that way." Gold said he "strategizes" regularly with CDO Brian Tilzer, whom CVS Health hired from Staples in 2013 to help cultivate a more customer-centric approach to innovation.
CIOs must serve customers
Companies are scrambling to deliver software and services that enable customers to better connect with their brands. This is adding new wrinkles for CIOs selected by CEOs to build platforms that deliver on a digital strategy. In some companies, CIOs are partnering on these strategies with CDOs and CMOs. In other, CDOs have taken the digital reins. Gartner said 25 percent of large companies will have CDOs by 2017.
However a CEO opts to assign digital responsibilities, CIOs are being asked to focus on customers in ways they never have before. “The voice of the customer still remains the most powerful," factor in their decision-making, said panel moderator Shawn Banerji, managing director at Russell Reynolds Associates.
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As part of an effort to create a more seamless experience for customers, CVS Health in 2012 began consolidating its websites and mobile applications. Behind the scenes Gold wrestled with "enormous technology implications," including data governance issues, as well as how to get portions of disparate systems to operate in unison. To ensure that CVS Health was adequately addressing customer-facing digital capabilities, it brought on Tilzer to lead the company's digital strategy. "I don't view it as a threat at all, I view it as an opportunity," Gold said.
Tilzer and Gold last May opened a digital innovation lab in Boston, where it co-locates IT and business workers to vet and test various ideas. Early projects, including digital prescription and insurance card scanning and integration with Apple Watch, have already come to fruition. The company also integrated technology from startup Curbside into its mobile app that lets shoppers order and pick up products in front of a CVS store. Gold says the innovation team’s remit is to fail fast. “Part of the output of innovating is going to be things that don’t work and that’s fine as long as you discover that early in the process as opposed to late in the process,” Gold says.
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At many companies, marketing and IT have long enjoyed a contentious relationship, with the CMO striving to move fast to get ahead of customer trends with little concern for business risks, leaving the CIO scrambling to pump the breaks. But as customers prefer to connect with their brands digitally, CIOs and CMOs find themselves working together rather than at cross purposes.
For this digital flight, please check that ego
As far as JetBlue Airways CIO Eash Sundaram is concerned, whether the CIO, CMO or CDO own digital is of little consequence as long as the business is giving customers what it wants. CIOs and other senior leaders need to check their egos at the door. "Leave the titles at home and come to work with a vision to make a new customer experience and then see how you want to structure your organization," Sundaram says.
Sundaram works closely with Marty St. George, JetBlue’s executive vice president of commercial & planning, to deliver digital capabilities. They share resources -- St. George has moved some of his marketing team to Sundaram's IT team -- and operate under the belief that the airline's customers drive its digital strategy.
Sundaram and St. George sit on the board of JetBlue Technology Ventures, an effort Sundaram leads to invest in technology startups that could help the airline improve passenger and employee experiences, as well as better leverage data in, the travel and hospitality industries. The venture unit is housed in GSVLabs, the Redwood City, Calif. incubator that is close to technology startups native to Silicon Valley. Sundaram says the startups JetBlue chooses to invest in could fill gaps in the airline’s technology portfolio, helping it to better serve customers.
The panel’s focus on growing digital capabilities was off-putting to at least one audience member, who said the panelists were suggesting that teaching traditional information management wasn’t a good tack for training future technology leaders. Gold said that universities must teach both fundamental IT management skills as well as what it means to be a business-focused CIO. "You have to understand the architecture of how the systems get built and maintained,” Gold said.