CIOs (and CTOs) should be corporate strategists. They have no choice. If their role is confined to operational/ infrastructure duties, they will eventually be marginalized and/or completely outsourced. Worse, they will be an afterthought at the big business strategy table. Sure, it can be a comfortable life. Worry about desktops, networks and data bases – and that’s it. But given the role that technology plays in business – arguably, technology is business – opting out of the strategic business planning process is a huge mistake for CIOs who want to survive the digital wave crashing on every corporate beach in the world.
Why should CIOs become strategists?
Business now depends upon technology for its very existence. Operational technology – office apps, networks, devices – is required for all business models and processes. Nothing works without digital. Regardless of how inwardly focused a CIO may be, there’s no escaping the role that technology plays in business at the most basic level – which enables the strategic level.
The distinction between operational and strategic technology has permanently blurred. The data bases resident in the corporate (on-premise or cloud-based) data base management platforms fuel analytics of all kinds. The strategic goal to leverage social media analytics for customer retention, for example, requires a variety of applications and platforms, some of which are “operational” and some “strategic.” The adoption of IOT requires access to existing data bases as well as the creation of new ones that are subsequently leveraged in all sorts of ways by sensors the CIO’s team install. Operational? Strategic? Both. The dependencies between operational and strategic technologies are growing so fast that it’s impossible to tell where one starts and the other ends. There’s no way even a diehard operational CIO can avoid this synergism – nor should they want to.
Another reason for CIOs to become business strategists is to protect their budgets. By linking operational budgets to strategic budgets, which tend to receive green lights more often than, for example, network and server upgrades, CIOs can protect their infrastructure budgets while enabling strategic spend. The argument is simple: if you want to pilot artificial intelligence (AI), machine learning (ML), augmented analytics, Internet of Things (IOT), blockchain and even augmented reality (AR)/virtual reality (VR) you cannot reduce the infrastructure budget upon which the strategic pilots depend. Right? Can you hear the pitch? It’s compelling – and accurate.
There are also organizational risks connected with “infrastructure only” CIOs. If CIOs step away from strategic planning and strategic technology, they run the risk of end-arounds, when business managers find someone else to satisfy their requirements. This is the new “Shadow IT” that usually happens outside the building. The worst thing that can happen to a CIO is to be sidelined with commodifiable responsibilities, especially when their company is looking for new products and services to increase revenue. If they’re not invited, CIOs should grab a seat at the big strategy table.
How should CIOs become strategists?
CIOs should adopt a two criteria filter: save money/make money. Filter #1 is designed to get the CFO’s attention. Reducing the operational technology budget should be the goal of every CIO – if they want kudos from the CFO – an ever-powerful corporate actor. There are existing operational technologies and emerging operational and strategic technologies – like robotic process automation (RPA) – that can significantly reduce technology spending. CIOs should constantly search for methods, tools and technologies that can reduce costs. Cost reduction should become a constant, highly visible project with meaningful milestones. While many operational CIOs are acutely aware of pressure to reduce their budgets, very few agree with CFOs convinced that technology costs way too much. Imagine a CFO’s reaction to a CIO who says, “you’re right … technology does cost too much! Let’s reduce the budget!” The alignment pivot is important. It builds credibility with the CFO and creates a partnershipthat enables strategic spending. Credibility is the grease here – even if the actual cost savings are small. It’s more about which side of the fence CIOs are perceived to occupy.
Filter #2 is targeted at sales, marketing and the senior management team. CIOs should champion revenue generation through technology-enabled strategic products and services. CIOs should befriend all those responsible for revenue generation. They should treat them as “users” whose requirements they must satisfy. For example, CIOs should become best friends of digital marketers and sales and customers managers, since sales and marketing cannot exist without operational and strategic technology. The last thing CIOs want sales and marketing to do is look elsewhere for technology support – and business technology strategy.
CIOs should also partner with those officially responsible for strategic planning. Every company has a strategic planning group, task force or some such group dedicated to thinking strategically about the company’s short and longer-term position in the marketplace. These teams also collect competitive intelligence. Since the competition and market trajectories will always be at least 75% technology-driven, there’s no way corporate strategists cannot be digital strategists. In 2019 – and forever – it’s simply impossible. So where should the corporate business strategists get their digital business insight? CIOs should offer their friendly services ideally as full-time members of any and all strategy teams in the company.
In response to this expanded strategic role, CIOs should establish strategic teams within their own organizations. These teams should link arms with the corporate strategists and work continuously to identify digital competitors that can disrupt the market – and threaten the company’s revenue. They should also develop new product and service ideas for the teams to consider.
Finally, CIOs should lead emerging technology in the company. This is an appropriate role for CIOs for obvious reasons. But CIOs should not keep this activity separate from the rest of the company. They should instead become the technology coffee shop for the entire company – all the lines of business, all the managers, all the strategists and all of the executives – the place where everyone comes to brainstorm about how emerging technology can transform business processes and whole business models. Yes, it’s a physical space (in the Office of the CIO) – a demo center – where emerging technologies can be demonstrated and prototyped. Food, coffee and technology toys should be mainstays of this space, where vendors are also invited to showcase their new ideas and new technologies.
The point of all this? Technology is business and business is technology – now and forever. While the trains, planes and automobiles must still run on time, CIOs should also be part of the development of bullet trains, hypersonic planes and self-driving cars. Who doesn’t want to go to that party?
