Is ‘smart modernisation’ the key to transformation?

The endless stream of new and emerging technologies flooding the market is creating a ‘kid in a candy store’ scenario for modern-day CIOs, amid board-level calls for internal modernisation.

Driven by a desire to become innovative, and therefore more competitive, organisations are converting pilot phase trials into real-time deployments to push through company-wide change.

Such plans are well-documented across all sectors in ASEAN, as CIOs assume a leadership position in transformation.

Yet legacy remains the Achilles heel of such transformation, with executives hampered by age-old infrastructure and worn-down systems.

“Most of the companies in our industry still manage a large percentage of legacy systems and services,” said Uli Braun, CTO of Asia Pacific at Atos. “Investing in new technologies is therefore a question of smart modernisation. The return on investment of a modernisation project can be very favourable when taking into account the cost that would be required to refresh a legacy system.”

From an internal perspective, Braun’s leading priority centres around “legacy modernisation”, a move designed to build the foundation required to “develop and deploy” future solutions.

For example, over the past two years Atos – a professional services firm – has been “heavily investing” in industrialising Internet of Things (IoT) solutions, spanning a wide-range of technologies.

“This includes the entire spectrum of related technologies, from developing edge devices [BullSequana Edge] through our technologies division, connectivity solutions including 5G pilots and software solutions in big data and analytics through the Atos Codex Suite of products,” Braun said.

“IoT is a major innovation catalyst as it requires new solutions to manage the unprecedented flood of data using machine learning, advanced visualisation and artificial intelligence [AI] to extract value from a huge amount of internal and external data sources.”

In assessing the changing market, Braun acknowledged that “no single” disruptive technology exists in isolation, rather a combination of solutions derived from a core AI base.

“They are leading to the biggest disruption of how we live and work since the beginning of the Information Age,” he added. “IoT, machine learning, deep learning, robotics and ultimately AI fundamentally change how we obtain, filter, interpret and use information and knowledge.”

When pressed, Braun said AI and IoT especially are the leading technologies disrupting the industry today, similar to the impact of Airbnb, WeChat, Apple Pay and Uber.

“Automation, robotics and machine learning in IT are quickly replacing traditional operations jobs and are fundamentally changing the way we do business,” he said.

“Changing and developing employee skills is paramount to stay relevant in this new environment – as a company but also as an individual.

“We are changing the skill mix of our workforce to further develop the capabilities in the technologies that will be relevant in the next 10 years.

“Ultimately technology is a tool to support a business outcome. Therefore, the measurement of success in technology projects depends on what the customer business is trying to achieve.

“If the purpose is to launch a new and innovative product, then cost maybe a secondary consideration, but if the aim is to increase the volume of transactions or production then incremental cost plays a major role.”

In light of such industry change, Braun said the CIO of 2019 has a “unique opportunity” to lead how a company changes rather than reacting to business requirements.

“The proliferation and complexity of emerging technologies can usually not be managed by an individual business unit but requires a unifying entity within the company to define, manage and develop the enterprise architecture and advise how to build new services on top of it,” he said.

Yet Braun accepted that “people skills and resistance to change” rank as the overriding barriers to innovation for technology executives today.

“There is a significant shortage of relevant skills in mathematics, data science, analytics and modern software development which impacts the ability to execute,” he explained. “And even if a project is developed successfully the resistance to change the ways of working can be high especially if people’s jobs are impacted.”

Braun said the role of the CIO has changed over the past 10 years from managing internal information systems to becoming a business adviser or consultant.

“Many companies have tried to react to the change in business demand by creating the role of the CDO and marginalising the CIO through that,” he said. “Many successful CIOs have assumed the role of the CDO and provide a technology driven business service. Less successful companies usually relegate their CIO under the CFO and run IT as a cost centre.

“Modern-day CIOs are technology savvy, business minded, able to see the big picture and have a vision, while understanding the enterprise data flow and attracting and retaining a diverse team of people.”