Digital transformation: Why the future is looking bright for CIOs

CIO Strategies: Digital transformation projects and the need to spread the use of technology throughout organisations is good news for tech chiefs.

Video: Why the customer experience in the real driver of digital transformation

While the pace of change continues to increase, so does the scope of IT leadership activities.

Analyst Gartner recently presented its vision for the future of IT leadership at its European CIO Symposium in Barcelona, with its key message for CIOs that executives who embrace digital disruption have more opportunities to excel across the business than ever before.

Here, we draw on the thoughts of Gartner analysts and CIOs to present six best practices for technology chiefs looking to inspire and lead digital initiatives across the organisation.

1. Recognise your wider ecosystem is the key to success

Gartner suggests successful CIOs will double the amount of technologies they use from trusted vendor partners during the next two years. Smart IT leaders, says Patrick Maes, group CTO at Credit Suisse, have realised they can't work in isolation and are collaborating with various partners.

Technology chiefs that want to make the most of digital change develop an ecosystem of partners that stretches across departments and beyond the business. "We have deep relationships with other banks, startups, researchers and incubators," he says.

"Digitisation happens when you work in an ecosystem. And you cannot collaborate externally if you don't take a similar approach internally. Collaboration provides real power when you see your internal people running innovative projects, like hackathons."

2. View your legacy IT as a help not a hindrance

Digital transformation is still the talk of the CIO community but that doesn't mean IT leaders can afford to forget about their existing technology investments. Gartner says 90 per cent of current applications will still be in use by 2023.

The analyst says digital platforms grow from the strong IT foundations CIOs have already built. Legacy technologies, in short, still matter. The technology businesses use today provides a base that, when modernised, will allow IT leaders to meet the requirements of digital business tomorrow.

"Legacy does not have to be a dirty word - legacy can be something you're proud to leave behind," says Tina Nunno, vice president at Gartner.

3. Find alternative sources to fill the AI skills gap

Scare stories about the replacement of people with robots are not hard to find. While Gartner warns 1.8 million jobs will be lost through automation by 2020, it also expects artificial intelligence (AI) to create new 2.3 million positions at the same time.

Moderately skilled roles, where most training is received in-job, will bear the brunt of job losses, while Gartner expects AI to create millions of new managerial and entry-level positions. CIOs should expect a significant fight for talent.

"While you need the capability, you might not be able to find the people," says Peter Sondergaard, global head of research at Gartner. "Find alternative ways to fill the need, such as contracting, developing and sourcing. And don't do it alone - work with the human resources department. They can help you to create an attractive workplace that attracts the best."

4. Grab the opportunities as digital chiefs disappear

Like other analyst firms, Gartner has received criticism for over-stating the potential impact of the chief digital officer (CDO). Gartner originally claimed a quarter of businesses would have a digital chief by 2015, and IDC said 60 percent of CIOs would be replaced by CDOs by 2020.

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Right now, those predictions look way off beam. Gartner says more than half (55 per cent) of the 300 top-performing CIOs in global businesses also hold the CDO role. While CDOs have helped drive innovation, Nunno says the analyst always viewed the digital chief as a temporary, transitory position.

"We've always believed in the criticality of CIOs and how important they are to the enterprise. Year-over-year technology investment continues to grow - and CIOs are not going anywhere soon," she says.

"For scale, you need a CIO. Companies and enterprises tend to be good at chopping stuff into silos and not great at collaborating. Many non-IT executives have been expressing frustration about the lack of opportunity to scale. The competency for scaling is with the CIO."

5. Continue to shift from the periphery to the core

Gartner vice-president Andy Rowsell-Jones says a key finding of the analyst's annual CIO survey is a quarter of European IT leaders expect their jobs to become more business-oriented. He says smaller, fleet-of-foot organisations demonstrate the benefits of a business-engaged approach to digital transformation.

"Disruptors are reaching out and showing they can work on a small scale with experimental ideas, but trying to do that at a larger scale when you're running a big enterprise is a different and difficult proposition," says Rowsell-Jones.

Gartner suggests CIOs must find ways to highlight the benefits of technology-led change. It is a sentiment that chimes with Jane Corolan, who is CIO at the Health Service Executive (HSE) in Ireland.

"I'm trying to find ways to influence health and healthcare through the introduction of digital solutions," she says. "My advice is to start small, pick off a few successes and demonstrate the positives to the people you want to influence."

6. Look for growth opportunities beyond the CIO role

Gartner says CIOs are adopting roles that drive growth. Such is the extent of the clamour for change that as many as 95 per cent of the highest achieving CIOs believe digitisation is altering the role of the technology chief.

Nunno says CIOs who act as digital pioneers move into pure revenue generation and are charged with creating new business models. Some of those CIOs are even spun off as CEOs running separate organisations. "It's a wonderful evolution to see," she says. "For a lot of CIOs, that's nirvana."

One such individual is Anders Torell, head of business transformation at construction specialist NCC Industry and charged with starting new ventures for his firm. Torell was previously a CIO and is using his new focus on entrepreneurship to transform into a business leader.

"If you can enable a new function, then you can say you're really creating something - you have a new business that is making money," he says, suggesting his team has already generated 15 new business ideas. "That is a proper metric. I'm ruthlessly focused on delivering more customer value."

woman-boardroom-view.jpg

"If you can enable a new function, then you can say you're really creating something - you have a new business that is making money,."

Image: iStock

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