CIO-CDO Dual Role Reinforces the Digital Commitment

NII Holdings

In 2012, Dave Truzinski was named CIO of NII Holdings, which provides wireless service to Latin America. In 2013, he was given the additional title of Chief Digital Officer. 

I am finding that CEOs across industries are making choices about which executive should lead the digital charge in their companies. Some are hiring Chief Digital Officers, with backgrounds in marketing, to give their companies a digital future. And others like Steven Shindler, NII Holdings’ CEO, are anointing their CIOs. 

Hiring CDOs from the outside is risky business. Do they have the experience of leading technology programs to adoption? Are they fully cognizant that pretty front-ends need to connect to messy back-ends? CIOs would be much better off positioning themselves as their company’s digital leader than have their CEO give that role to someone else.

When Dave Truzinski added CDO to his CIO title, I caught up with him to learn more.

Why were you given the CDO title?

I have been pushing a digital agenda for several years now. I have been promoting the notion that digital technology and digital engagement with our customers is the only business model that will survive in the future.

The very fact that I have been named CDO signals to the entire company that we have to move to a new business model. Our customers are interacting and engaging in a social media context and we need to be there in a significant way to meet their expectations. We are now in the digital age with a digital economy. The CDO title represents the recognition that we can no longer do business in the “industrial age” way.  

What differentiates the digital age from the industrial age?

In the digital age, we need to think about moving our core business processes to algorithms. To my mind, algorithms trump organizations. For years, we’ve been taught that when we have a business problem, we can solve it by bringing people and teams and organizations together. We’ve been taught that the more people you have, the more power you have. But that kind of thinking is a by-product of how organizations have evolved. That’s “back-office” or “business administration” thinking and it doesn’t help our customers. We need to push from a back-office culture to an algorithms culture and act faster. Speed and agility matter more than ever right now. People and processes create latency; algorithms, whose purest form is code, create speed.

Large organizations bloat quickly because they need more people to manage more stuff, when most of their business administration problems could be solved by code.  Think about what would happen if we automated everything your back office teams did and told them, “Now that you are free of that manual work, we want you to spend more time thinking about your customer and driving top line revenue.”

What are the challenges in moving from organizations to algorithms?

Legacy cultural pull is very strong.  The larger the organization, the more risk averse it is, and change represents risk. We’ve been building businesses for hundreds of years, but in an entirely different technological context. And now we have to change everything. Mobility has been one of the most powerful technologies we have ever seen, and that kind of change can be intimidating to large organizations with ‘working’ legacy solutions

I am lucky in that my boss, our CEO, understands this like no other. Our digital agenda has support at the highest level of the organization, which means that when I work with the presidents in our operating markets, they are already driving for digital transformation. We are a telecom company with over 9 million subscriber units. In this industry, if you are not on the leading edge of big data and mobility, you may soon become irrelevant; the fundamental business model for mobile network operators and many other businesses is changing.

What are some of the more effective ways that you have pushed your digital agenda?

We have big ideas and big visions, but we’ve gone after small wins. A few years ago, we were just launching some state-of-the-art data networks in Brazil. We looked for ways to drive additional revenue from the new data network and realized, “We can use automation to grow our revenue.” We commissioned an app that lets our customers know when they are getting close to the end of their data consumption. This allows our customers to buy more data, which has generated additional revenue for us. But more importantly, it has allowed us to engage with our customer in a digital context every month. Now we are enhancing that engagement to improve the customer experience.

As another example, we put together a small team to use Hadoop and other big data technologies to perform real-time analytics on our customer databases. With a minimal investment, we reduced the time it takes to process extremely large data sets and gain customer insight; a process that used to take days is now being done in minutes. In both of these cases we were prototyping, and achieved positive outcomes, which created the business confidence to go further.  The key to pushing our digital agenda has been small wins through prototyping.

What are you changing in IT to drive this new way of thinking?

We are in the process of moving all of our back office systems to the most current instance of our suppliers’ software packages with no customization; we are becoming militant about accepting no changes to back office systems. We used to spend our entire life customizing CRM, but now we spend that time customizing our customer facing platforms. We customize where we can create customer engagement and drive revenue. All of our back office systems have to have the most generic implementations with their capabilities exposed to web services. This is easy to say, but harder to do, especially when our IT people all have day jobs.

With our ERP system, we had been sub-optimizing the system to the function. Rather than aligning our processes to the capabilities of the ERP system, our IT teams used to ask our business partners, “What do you want the system to do?” They took those unique requirements and created a customized solution for a standard business process. But when we recently upgraded our ERP system, we took that as an opportunity to say, “No more changes.”  

When you can’t do a wholesale upgrade, you have to live with what you’ve got. We have a highly customized billing support system, but now we are pushing modifications out to the customer interface, out to the mobile context, where it matters.

As I mentioned earlier, we are big fans of prototyping. If the prototype fails, we just throw it out. We are creating an IT culture where you are allowed to chase after an idea. We are putting more emphasis on a test, learn, evolve pattern. We are seeing some early wins, particularly in the area of big data and customer insight.

Big data, cloud, and mobility are redefining customer engagement, and business speed and agility. These technologies allow us to understand our customers and operate at customer speed. Successful CIOs will rely on cloud solutions to digitize and simplify business administration activities. They will develop deep insights about their customer by leveraging the information available in big data to engage with customers in a context-aware manner. And they will deliver that engagement on mobile. CIOs and their IT teams are uniquely qualified to lead digital transformations, as they know every facet of the business and the underlying technology implications.

About Dave Truzinski

Dave Truzinski is Executive Vice President, Chief Information Officer and Chief Digital Officer of NII Holdings, Inc. He ensures the delivery of critical global IT initiatives, drives improvements in enterprise-wide productivity and customer service excellence and focuses on innovation to streamline operations. In addition, he supports the company’s vision of IT as a strategic enabler of the business, as well as CDO, he leads a coordinated and comprehensive digital strategy for the company. Previously, Dave was SVP and CIO at Leap Wireless for more than six years, as well as CIO for Cingular/AT&T Wireless’ International business. Dave holds a bachelor of business administration from California State University in Sacramento.

About NII Holdings, Inc.

NII Holdings is a provider of differentiated mobile communication services operating under the Nextel brand in Latin America. The company focuses on providing businesses and high value consumers with fully integrated wireless communication tools, superior customer service and an ever-expanding network. The company is headquartered in Reston, VA, and as of December 31, 2014, had more than 9.2 million subscribers.