In the UK, digital” has been dropped from the vocabulary of many organizations. Because it is assumed that everything that a business does has a digital element to it: Dealing with customers, suppliers, and staff is all expected to involve digital processes to some degree. This raises the question of what the role of IT is in an organization. The standard IT mantra of: “We enable business through the use of IT,” will get a response of: “Yes, that’s expected from you anyway. Now, what does IT do to make this organization succeed?”
So let’s look at what modern organizations value. The business world is characterized by change, intensified competition, global impacts, and instant communication, all of which are enabled by technology, of course. Saying, “We enable business through IT,” is like saying, “We do what is already done.”
Technology has accelerated the pace of change: New products come and go at a rapid rate, and indeed, the lifespan of organizations has dropped from about sixty years in the 1970s to less than 20 years now. A five-year plan may look good on paper, but may cover a quarter of the expected life of an organization. Strategy needs to keep pace with change. Some organizations are finding that annual strategies aren’t serving them, and have moved to an emergent strategy model, or a “sense and respond” strategy which both operate in monthly or even weekly cycles. IT needs to respond to business, customer, supplier, and staff requirements in weekly cycles. Those IT departments which haven’t “gone agile,” should consider it now.
Competition has been intensified by technology. There are three digital approaches to technology: Firstly, you can have a purely digital product – books, apps, productivity tools, connectors, and so on are digital. Uber, Airbnb, Travelstart, online banking, are all digital products, supported by back-office functions. Then you have physical products which are enhanced by digital tech – motor-cars, smartphones, home security and the like, all have a physical manifestation, but would be so much less without their digital components. Finally, you have digitally “wrapped” products. For instance, a mountain bike, which is a very physical product, can be wrapped in a digital site which is a virtual showroom, a trouble-shooting area, a maintenance tips area, and a cycling and fitness tips area. None of these is the bike, but they all make the bike experience more valuable to the customer. IT is more than an enabler of digital processes for products. In some cases, IT is the product, in others, IT is the value added to the product. In discussions with the CIO of a luxury car manufacturer, he said that they use AI for their testing of vehicles, and have eliminated physical testing completely. They also use 3D printing for parts, and concepts they wish to try out. They are more than an enabler here.
A change somewhere on the globe can affect your local business. A new procurement service in China can change how organizations worldwide procure their material. There is, for instance, a Chinese company of 50 people, which links 50 000 suppliers, to provide custom-procured content, parts, and products for other companies worldwide. They offer the platform and the ecosystem. One of the new roles of IT is to identify tech trends that affect their organization and to provide solutions and responses to mitigate threats or optimize opportunities no matter where they are in the world.
Finally, communication is instant and global. Your customers talk to each other, videos go viral, consumer sites rate your service, and competitive products are instantly comparable. A problem you have with a product will be known within days by your customers, but more importantly, a success story or deeply satisfactory customer experience can be communicated instantly. IT’s role is to monitor communications and discussions or make monitoring easy and available to your marketers. Your website cannot be a static affair but should be an ongoing interaction with customers and suppliers. IT can test opinion and mood, and alert the organization to changes and trends.
All of this is far from the “plan-build-run” enablers of business processes that some IT shops still cling to. The new role of IT means that it is a driver of change, it talks to customers, it helps develop products, and it is always aware of what’s happening in business circles. They use outsource and use managed service providers to deliver the essential but routine elements of their service. Their team is mainly outward-facing, and a few managers of services focus on the “enabler of business process” element of what they do. This back office IT is critical, of course, and CIOs should look to partner with service providers who share their passion and commitment to their organization’s success.
Author – Barbi Goldblatt – Regional Executive