CIOs R&D experience can produce innovative business models

The focus of CIOs can broadly take four forms: run the business (automation); save the business (salvation); grow the business (augmentation); and change the business (transformation).

Automation is typically why we were recruited, to drive out cost through taking people out of the business processes.

Salvation presents a Red Adair opportunity to be a corporate hero, though it is more usual for the CIO to be a convenient scapegoat for corporate tailspin and has since been ejected.

Augmentation can be good for business relevance. In essence the company needs more scale in respect of what it does and it sees new technology as an enabler in this regard. So enhancing the non-core systems – possibly built by interns to keep them busy – to lie at the core of global expansion is a thankless challenge. Stepping stones rarely make effective bridges, but it does the job and starting from scratch is not an option.

While being an augmentor is better than being an automator, it is still an ‘order-taking’ role in respect of business requirements. Of course you are well placed to suggest that the 16 CRM systems get consolidated down to one, but it hardly represents business transformation. Whereas automation made you the digital janitor, augmentation makes you the digital plumber. Your job is to optimise the flow of data around the organisation. This is an important role because blocked data pipes lead to inaccurate decision making and poor governance. Throw in some analytics services and we are looking at what a real CIO should be doing.

But given the importance of new technologies, why isn’t the IT function more deeply woven into the strategic fast lane?

The arrival of the web was the perfect ‘on ramp’ as is mobility and social media. Who in your boardroom is ruminating over augmented reality delivered by glasses, contact lenses or a car windscreen? Somehow you need to establish the trust with the leadership team to consider the implications of new technology on the existing business model. CIOs who have the attention of the C-suite in this respect are in a strong position to play a leading role in organisation transformation.

But this requires your technology radar to extend beyond HTML5, hypervisors and unified communications. Technology is driving frugal businesses, collaborative consumption and asymmetric businesses to name but a few technology-fuelled business models. So for the next few months just scan the business publications, including some of the more forward-thinking titles such as Wired and MIT Review, to get a feel for the ‘over the horizon’ trends.

Here is the good news. In the short term you are going to make a high impact very quickly in an area where you are likely to have great experience. There was once an approach to system development called Rad (Rapid Application Development). Today we call it Agile, and it has contributed significantly to technologists adding social skills to their repertoire in order to stay in demand. Engaging with users as business peers is challenging but ultimately rewarding as the chances of building what the business wants and needs increase drastically.

But the best news of all in respect of this approach to improved business relevance is that the business world has just discovered prototyping, albeit under swanky names such as ‘minimal viable concept’ and ‘minimal viable product’ to give it venture capital edginess.

To me this is an opportunity for the IT function to be extremely business-relevant. Instead of working with users to iterate the prototype, you work with the users and the market to do just the same.

For example, the users have an idea for a new online business that might take your car hire business into a collaborative consumption model whereby the customers provide the cars. You now work with the business leaders concerned to establish how this model can be tested with minimum cost and risk. If the initial prototype has merit you build on it otherwise it is discarded, abandoned or a different approach is taken. ‘Fail fast but fail smart’ is the mantra.

Imagine a future whereby one of your KPIs is the number of business models you have test-driven over the last quarter.

Thinking about it, the notion of taking some intern’s ‘prototype’ and building the business around it seems not so silly after all. I believe the new term for this is ‘an app’. Transformational.


Copyright © 2013 IDG Communications, Inc.

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