by Ted Schadler, VP and Principal Analyst, Forrester

CIOs: Are You Ready For The Empowered Era?

Nov 28, 2010

It’s time to accept that today’s customers have more power than ever before. We inhabit an age in which empowering technology is readily available first to individuals, not to institutions.

This means consumers and employees will always get the new good stuff first, and we can expect it to be this way from now on. We’re constantly seeing evidence of the empowered consumer: checking a price, reading a product review, or asking for advice from a friend right from the screen of a smartphone.

Brands are constantly being discussed by customers — good and bad— on Twitter and Facebook, and products and services are reviewed in blog posts, or on Yelp and And we’ve all been entertained by a brand-building or brand-destroying video that’s spread globally across YouTube.

But it’s not just consumers who are empowered, it’s also employees. In fact, 30 per cent of European information workers are solving customer and business problems using technology that they master first at home and then bring to work.

And this trend is showing no sign of slowing down. Forrester believes four technologies are empowering customers and employees alike, which we’ve detailed in the new book, Empowered. These technologies are mobile, social, video, and cloud, each of which is providing individuals tremendous access to information and resources.

As a result of these empowering technologies, the focus of technology innovation in the enterprise has shifted. People outside of IT — often in marketing, sales, and customer service — are innovating with new technology solutions to reach out to customers.

The CIO’s job is not to stop this activity, unless order and rigidity are more important to the company than competing in the empowered era. Instead, CIOs must shift their mindset for a world where technology projects can come from anywhere, and IT is a key advisor, not manager, on those projects.

To succeed in an era of empowered customers, CIOs must empower employees to solve customer and business problems.

Of course, the question that remains is how CIOs can empower employees to solve these problems? It’s important to note that empowered isn’t a phase that should be responded to and then moved past.

It’s inevitable that groundswell technologies will continue to shift information power to customers and employees. And this power shift can’t be stopped, but CIOs can take advantage of it.

To do so, customers should be treated as the most valuable marketing channel, and employees should be treated as the most valuable source of ideas and innovation.

This means recognising that success in the empowered era may start by acknowledging and harnessing the power of customers in marketing outreach, but it never stops as customers become an important marketing channel, product development advisory council, and support community.

We have identified four initiatives to help companies engage directly with customers:

Identify mass influencers

Deliver groundswell customer service

Engage with mobile applications

Amplify fan activity

On the flip side, only employees are agile enough to respond to the escalating demands of empowered customers. They’re also in the best position to see the problems and to experiment with solutions that take advantage of new technologies.

We call these employees HEROes — highly empowered and resourceful operatives. CIOs need to embrace and harness their ideas. Today that might be as simple as empowering them with social collaboration tools and access to iPads, Facebook, and Google Docs.

Tomorrow it might be as in-depth as establishing a groundswell innovation program as Chubb and Cisco have done.

CIOs can start empowering their customers and their employees by breaking down internal barriers to collaborate and govern across department boundaries. For example, consider adopting the HERO Compact to define responsibilities and manage risk.

With new technology coming to individuals first, CIOs have to think differently about how to manage technology-based innovation. Yes, there is risk. And it can’t be avoided by locking down the social, mobile, video, or cloud systems.

Instead, IT professionals need to work differently with employees and with business managers to assess and sign off on the risk. This is the HERO Compact and it defines the new role and responsibilities of each group:

It’s possible the empowered era will creep up on some organisations, slowly and steadily as empowerment projects appear on the radar screen. Or, it could explode onto the scene as a customer engagement goes badly and lands the CEO on the front page of the International Herald Tribune.

Either way, CIOs will have an entirely different agenda to manage that will make the IT team relevant and valuable for years to come. The key will be to tackle high-impact, customer-facing initiatives that will quickly build momentum and excitement.

A few ways to start this process include

– Incorporating a listening platform for marketing, service, and sales

– Focusing on community software for direct customer engagement

– Making the most out of mobile by supporting BlackBerry, iPhone, and Android devices

Now is the chance for every CIO to be the chief technology advisor on empowered initiatives.

Ted Schadler is Vice President and Principal Analyst at Forrester Research, serving content and collaboration professionals. He is co-author of Forrester’s latest book, Empowered: Unleash Your Employees, Energize Your Customers, and Transform Your Business (Harvard Business Review Press, September 2010).