Why the customer relationship now matters to CIOs

IBM has released a study showing how the consumerisation of IT has forced CIOs to reposition the IT function in their businesses.
Written by Aimee Chanthadavong, Contributor

CIOs were once responsible for leading the way in supporting basic IT services and operations, but over the next three to five years, IBM has predicted that they will take on a larger role in making decisions in the broader business.

According to findings of the latest IBM Global C-suite study (PDF), CIOs have proposed that they will be spending more time on customer-related activities by adopting new technologies in order to reposition the IT function in their business.

IBM ANZ interactive experience leader Ian Wong said that there are three main themes driving the changing expectations of the role of CIOs. These are the expectation that organisations need to open their business up to customer influences; that businesses need to pioneer with technology-enabled innovations; and that businesses also need to craft an engaging digital experience around the physical relationship they have with their customers.

"There is the changing role of the CIO within the CXO segment, where they are moving from the back office to the front line," he said.

The study also showed that only 47 percent of Australian customers wield influence on business leaders, which is the lowest compared to 54 percent of customers globally. Today, only 29 percent of enterprises claim they have strong collaboration with customers, but over the next five years, Australian CIOs hope to triple that effort to 87 percent.

Based on the study, face-to-face is still the lead channel for customer engagement for 80 percent of businesses, followed by digital, at 66 percent. But over the next three to five years, this trend is expected to reverse, with 92 percent of business leaders identifying digital as the main channel to engage with customers.

"What is happening is the balance of power has shifted to the customer because of what we're calling as the term of the 'consumerisation of IT'. Everyone now has a device, or multiple devices, where they have access to more information and they're interconnecting with each other, therefore the customer is becoming a stronger force in that balance of power," Wong said.

Business leaders have identified to IBM the top three priorities for improving customer engagement: Creating a consistent customer experience (81 percent); quickly responding to emerging trends (77 percent); and combining internal and external data to gain insights (76 percent).

The IBM research showed the main digital channel that 84 percent of CIOs used in 2013 to support a closer customer engagement is mobility solutions — ahead of business analytics (83 percent) and cloud computing (64 percent).

Wong said mobility is helping organisations craft the business and customer relationship.

"We have jumped from a stationary way of consuming digital to a very mobile way. So that's why mobile is first," he said.

"The interaction platform is now becoming predominately mobile and tablet, which is usually where we're seeing the first interaction happen. When the relationship deepens, that's when the interaction may move to desktop or to a physical interaction. Mostly, where we see the frequent interaction is in mobile. In fact, the mobile space is the way to intersect the digital and physical interaction at once."

However, two thirds of Australian business leaders in the study still admitted that they have a weak digital strategy — or none at all, with only 32 percent claiming to have an integrated digital-physical strategy.

Wong advises the way forward into a technology-influenced environment is for businesses to have a collaborative strategy amongst their CXOs.

"The CMO and CIO need to become a duo, while getting directions from the CEO in terms of stitching together that digital strategy," he said.

"The art of the digital strategy comes from the CMO who understands the customer and knowing what the vision is, while the science of that digital strategy comes from the CIO. The two of them working together in unison — where all components of that strategy is laid down in a roadmap and stitched together in a meaningful way — is the best approach to a digital strategy.

"What we're seeing right now is components of strategies being implemented, but they're taking a very silo approach."

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