The CIO role has clearly changed over the last several years. On average, CIOs are younger, more diverse and less focused on developing things. Given this, I thought it was time to get a fresh view of their information technology priorities.
CIOs say there should only be a direct correlation—100 percent alignment. One of CIO even said to me that this question is a layup. IT organization, CIOs say, need to function just like other business departments but differently IT’s priorities should be an aggregate of all businesses priorities.
Some CIOs even believe that alignment is not a good enough goal. These CIOs claim the modern CIO’s business is the enterprise’s collective businesses. They feel as well that CIOs should have their fingers into them. Clearly, business priorities often rely on invisible technologies, so these CIOs say it is essential that effort is made to be transparent regarding how IT initiatives connect to business priorities.
CIOs, in general, warn that business leaders may not grok the combined priorities that IT is pursuing. For example, if business priorities include web sales, PCI compliance should be a requirement. This could look like a technology priority at first blush and something that does not align to business priorities, but it aligns instead to overarching corporate priorities around governance, risk and compliance.
CIOs should not just be an ‘order taker’
At the same time, CIOs suggest that innovation outside the project list can be in or out of alignment. This means that priorities should be reviewed regularly for alignment. With this said, CIOs stress that alignment should not mean that the CIO just takes orders. Alignment means IT builds what business needs to get business results.
Here the CIO need to balance their role as a business sponsor and change agent for the business’ future. Sometimes in this role, CIOs need to push to make sure business priorities are the right ones or work to adjust them as business realities change. CIOs suggest importantly that innovation is a team sport. Effective CIOs will have ideas that are worth sharing with business leaders. CIOs believe that delivering on a business imperative or market expansion or rapid time to market of products can require CIOs to help the business recognize when a current tactical objective is no longer valid.
Shadow IT: an indicator of poor alignment?
CIOs interestingly suggest that one symptom of poor alignment between IT and business priorities is shadow IT without any IT involvement. CIOs, however, claim that shadow IT can be a great thing for an organization when it is done in a thoughtful way. In other words, there aren’t six versions of Salesforce. CIOs for this reason suggest that CIOs identify metrics that not only indicate performance of IT investments but also of IT alignment. CIOs stress that if you are looking at things as shadow IT vs. corporate IT, then you have already started with the wrong paradigm.
How should technology change get factored into business priorities?
CIOs say that ultimately, the CIO and greater IT organization need to bridge the gap between business priorities, outcomes, and the appropriate technologies to use as leverage. CIOs believe part of this involves the CIO being able to translate technology change into language and benefits that the rest of the business can understand. It is amazing, given this, how many vendors still sell features versus benefits to IT organizations.
At the same time, CIO should always be evaluating impact of emerging technologies in relation to their organization. This involves converting them into business outcomes and opportunities. At this point, one CIO asked which came first, the business opportunity chicken or the technology opportunity egg? This CIO suggested that CIOs need a ”Star Trek Universal Translator” that can translate both ways.
To do this well, it is increasing important that CIOs are actively involved in strategy and the operations of their businesses. CIOs say the quality of technology translation depends upon two things: (1) maturity of the IT organization, and (2) the level of trust for a CIO. It is essential that CIOs understanding their firm’s business model and put in place things like data governance. CIOs claim it is important to have champions in the business helping to stay connected below the C-level. Too often, CIOs say, the CIO is the only person that can do this. However, organizations ultimately need to involve more people and ensure the CIO isn’t a bottleneck.
Business discussions shouldn’t be one way
CIOs suggest as well that CIOs and IT should never have one-way business discussions—the business to IT. IT needs to be able bring ideas/projects to the table, formally (budgeted by IT) or informally (look at what you can do with this tool). This matters in the digital era because all companies are digital companies. Survival often depends upon the quality of the digital capabilities.
CIOs believe it is critical to activate the channel to strategy development and business-integration. As well, they suggest this really needs to be a collaborative effort and not some form of “groupthink.” Clearly, a CIO with the right mindset can lead here. CIOs and other IT leaders need to lead the discussions on the potential and impact of technology change just as business leads discussions on the potential and impact of business changes. In successful businesses, both voices must be heard.
How and where should there be an interlock with the business?
CIOs say that they are not as surprised that there has been limited understanding of business objectives by the CIO and IT leadership team. Nevertheless, they say it is hard to have a meaningful conversation without this. CIOs say that there should be engagement (discussion, education and trust) between business management and IT executives/managers at every level. Silos mean business questions move up a business stack, then down an IT stack, for answers. Horizontal relationships improve fluidity.
CIOs believe there should be an interlock. They suggest that any idea, strategy, initiative, imperative, and project is a business item to be assessed, prioritized, approved, funded and delivered. These just have varying degrees of technology size and complexity. The question shouldn’t be whether but when an interlock not occur. Today, CIOs believe the relationship needs to move toward a more symbiotic and aligned engagement.
CIOs say that they want CXO meetings, governance in architecture, and change management. CIOs suggest an interlock at the point of where technology offers the most value to business objectives. CIOs stress that there shouldn’t be IT priorities without something being directly created as a business priority. When I led the creation of an ITFM software, I ensured that all dollars could be integrated and tied back to a business priority.
CIOs should be informally, encouraging business interest in what the IT department is doing. CIOs think that servant leadership top-down can help this process. CIOs succeed here by serving the people who need something. This is key to CIOs being perceived a success. CIO should aim to always be transparent about (1) what it takes to run the “as-is” environment; (2) how they are driving continual improving and increasing efficiency/effectiveness including containing costs; and (3) how the security posture relates to new investment.
Should traceability between business and IT priorities?
CIOs said if you are not using the same language as the business at the outset, then you are two steps behind. They claim that it may seem like a small thing, but it makes a significant difference. IT should use the same name and unique identifier as the business uses.
CIOs said after all business priorities should drive IT priorities and not the other way around. They believe that it is a problem when the C-suite doesn’t understand the priorities of IT are aligned to the business. For this reason, CIOs say that changing the language of IT is critical. And this needs to span all priorities. This enables traceability into the business outcomes IT delivers.
CIOs say that so many communications documents—the IT internal documents—use technology labels. These things need to be linked to strategic plan items as a descriptor. You should try to use business language from things like annual reports. IT tasks don’t need arcane names. One CIO gave an example. They said “implement required security for payments project tucked under the payments project makes the ‘why’ clear. They said the ‘how’ belongs in technical specification documents.”
IT, product companies, and government agencies clearly having liked historically using cheeky code names for projects that have nothing to do with the project purpose. What is needed by today’s IT department is traceability—this means the business sees the value budgeted for and the impact for changing the cost/timeline. One CIO suggested here that traceable measure of success is business value delivered.
All of this means that IT leaders need to be able to speak to the performance of the investment as they conduct ongoing discussions about the return on mission or investment, depending on the type of enterprise. At the same time, it remains important to focus upon business metrics for projects and service delivery.
CIOs clearly want their priorities aimed at where the business is going. They want traceability, but they also want and need to be part of the process. Part of doing this involves creating two-way conversations and active sharing where IT is adding value to the organizations. There is still much to do here.