In the second and final part of this series on the history and future of the chief information officer, we ask if CIOs need to become process and information architects to drive innovation inside their organisations.
IT has fast become a vital part of the internal mechanics of most enterprises. This has made the chief information officer’s role more important than ever as the quality of technology implementations often has a direct result on an organisation’s revenue potential and can even make or break reputations.
So does this mean that CIOs will need to morph into chief innovation and operation officers in the coming years? John Roberts, research vice-president of Gartner’s CIO and executive leadership research team, says there are a few possibilities.
These include IT simply being an engine room to run data centres, crunch numbers and maintain applications; or the IT organisation becomes a service global provider and plays a larger role in creating process and information architectures, even leading business process design, he says.
“Another scenario is where everyone accesses IT [from the cloud]. In that future, the CFO, for example, can simply access software-as-a-service and run everything from the cloud so the role of IT almost becomes a broker for these services.
“The answer is likely to be somewhere in the middle,” Roberts says.
Gartner’s Roberts says that an executive at a utility company in Singapore is known as the manager or process and innovation, who still runs IT, but is looking at opportunities for improvement through new business models, which are enabled by IT.
Allan Davies is the long-time Asia-Pacific CIO at global logistics systems supplier, Dematic. He says of all executives within an organisation, the CIO is one who – in more cases than not – has an intimate understanding of the business process across the organisation and is in a good position to provide some guidance.
However, he doesn’t see the CIO becoming the “information architect” because the CIO doesn’t own the business processes.
“My experience has shown that unless the process owner takes responsibility for the automation, they can be reluctant to use the end product as they see it as an IT solution,” he says. “CIOs can help business process owners challenge the status quo, challenge them to think past their immediate requirement and think long term.
“The fault many people make is they try to automate a manual process thinking that the automation is going to fix all the associated issues with the manual process; this is where the CIO can assist.”
Related: CIOs still acting as IT managers: Gartner.
Peter Nevin, who has been a CIO for more than 20 years, agrees that we are seeing a greater degree of automation of business processes across many organisations, which means CIOs need to become process architects.
He says the CIO should be affecting business processes and client interactions inside the organisation and “if they haven’t got that sorted out by now, they probably shouldn’t be there.”
But the influence of the CIO on these things will depends on a company’s size, segment and industry, says Nevin.
“The health industry, for example is very customer-focused, [but in] a knowledge working industry it is very difficult for the CIO to get to a point where they affect the client relationship because that’s what the knowledge worker does.”
There has always been a need for CIOs to be involved in business and process development and strategy and every new generation of managers needs to “learn the lessons all over again,” says IT industry analyst, Graeme Philipson.
“This whole idea of IT and business alignment is a journey, not a destination – no-one ever gets there,” he says. “There is always this divide between IT and business and if an organisation with different personalities and people bridge that gap to a greater or lesser extent but it’s always there.”
New technologies, new challenges
New technologies are also striking at the heart of how businesses operate, which is also forcing CIOs to rethink how technology aligns with their organisation’s objectives.
The massive amount of data being generated today – commonly known as big data – and the issues around allowing employees to bring their own devices to work are business issues that IT departments need to address.
For instance, dealing with unstructured data generated through numerous social networks is a challenge but some organisations have devised strategies to communicate and interact with their customers through these external networks.
Tennis Australia has learnt how to do it well. The organisation analyses social media to measure players’ popularity at the Australian Open and ensure its systems can handle spikes in user activity.
But for many, it’s still an untapped opportunity. Dematic’s Davies says the rise of social media is certainly seen as a challenge for many CIOs at in his case, the angst stems from the “ingrained obligation to protect data within company borders.”
“However, the explosion of consumerisation to-date makes this an exceptional challenge and [it] will only get harder in the future. As a CIO, you know how much or how little consumerisation will benefit your organisation and if you’re in an industry sector where you allow BYOD, then you need to get a strategy in place pretty damn quick.”
Davies says an IT division would traditionally implement the appropriate level of security and take responsibility for breaches with users oblivious to the effort required or the “consequences for the CIO for breaches of security or loss of IP.”
“So what happens when you ask the end user to accept the same level of responsibility? Is the drive to bring your own device [to work] as attractive?” he says.
“I think the way forward is through end user education and I don’t mean in the form of yet another “policy” but by engaging with the end user to see what level of responsibility they are willing to accept.”
Philipson believes the issues created by the BYOD phenomenon around how CIOs deal with end-user devices is “very similar to what happened 25 years ago when PCs first came into the corporation and MIS managers had to deal with the proliferation of end user devices.”
He says that while allowing people to bring devices to work makes management more difficult, “there are mobile device management [tools] that help people do that.”
Nevin is adamant that the consumer technology industry will continue to mature and there will be “one or two” market leaders and CIOs will adopt that into their portfolio of management.
“In fact, it’s probably happening right now; instead of having 50 different types of smartphones that I support, I am pretty much there, I don’t care which brand it is anymore,” he says. “We are already starting to see that rationalisation.”
It’s only going to get harder
CIOs are different from other C-level executives because they are “spanning many, many things simultaneously” says Nevin.
“The complexity used to be [around the] hardware and that was incredibly difficult, and then over time it was the system; now [the complexity is around] understanding all of the organisation’s business processes.”:
He adds that a good CIO can have enormous benefit to any organisation, much more so than in the past.
“Unfortunately, the reverse is true, a bad CIO can utterly take out the organisation; they can spend massive amounts of money, they can damage culture, more so than they used to be able to.
“I [the CIO] can affect the culture of the organisation by the nature of the technology I roll out and the way I control that technology.”
While the role may be getting harder for some, Dematics’ Davies is hoping his future involves something significantly more relaxing.
“How I would like to see it [my role] evolve in the future involves the Mediterranean and a 20-metre yacht,” he says.
Follow Byron Connolly on Twitter: @ByronConnolly
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