Leading the digital enterprise: Five tips on how to get there

This year's MIT Sloan CIO Symposium focused on the digital enterprise and how the line between internal and external customers is blurring.

The 11th annual MIT Sloan CIO Symposium's theme, "Lead Your Digital Enterprise Forward," focused on how CIOs can...

ensure technology helps determine business strategy rather than simply enabling the status quo. The day-long event provided food for thought on how CIOs can use technology to help transform the enterprise -- and inoculate their companies against digital disruptors. Here are five tidbits to get the wheels turning.

1. Be great at these three things

"The defense to disruption is to be great," Peter Weill, senior researcher and chairman of the MIT Center for Information Systems Research (CISR), said during the opening panel. "The question is what to be good at." 

For CIOs who believe that list is too long to even think about, think again. Weill believes that the successful digital enterprise hinges on three things: products and information; multi-customer experience; and the platforms to deliver new or existing products and services in an interactive, user-friendly, integrated way. "When we challenge boards we talk to, we talk about how good are you at those three," he said. "Which ones are going to be your sources of competitive advantage going forward?"

2. Build holistic alignment

The old and often-scorned term of IT-business alignment enjoyed a revival at the symposium -- but with a twist. For Stephen Neff, enterprise CTO at Fidelity Investments, it's "all about alignment: alignment between technology and business, between the different technology groups, and, in our particular case, alignment on a global basis because we have a number of locations in the U.S. and in three countries overseas."

Ricardo Bartra, CIO for the Americas at the freight company Deutsche Post DHL-Global Forwarding, also championed alignment: "I think this is very important: Aligning priorities, whether you're doing customer-facing solutions or you're doing internal projects." He said that one way to ensure everyone's on the same page is, to "talk in business terms."

As Bartra's comment suggests and other CIOs throughout the day confirmed, alignment needs to be broad and include not only a company's external customers but also its shareholders. Right now, however, CIOs generally do not have enough interaction with company boards of directors, according to Stephanie Woerner, research scientist with MIT CISR. "The issues boards and CIOs are talking about right now are strategic in a reactive sort of way. So, it's about security and privacy," she said.

Based on Woerner's new research, CIOs and boards aren't talking about how "digitization is going to change the business model," she said, or how the company could be disrupted. She predicts that will change in the next couple of years, as more industries are upended by digital disruption and boards begin to consider what IT can do "to alleviate or stop this kind of disruption."

3. Meet customers on their digital territory

Consumers are tech-savvy and plugged in, with more information about a company's products and services at the tips of their fingers than ever before. For Roger Gurnani, CIO at Verizon, that's creating new ways to engage Verizon customers.

Rather than wait for customers to interact with the company through its channels, Verizon is seeking out "customer immersive channels," he said, "where we engage with the customers the way they want to live their lives."

Last holiday season, as Verizon customers brought new digital devices into their homes, the telecommunications company helped connect those devices to its FiOS service and, in some cases, made what Gurnani referred to as "smart recommendations." For customers who would benefit from increased bandwidth, Verizon pushed a notification onto a customer's tablet or television. With a tap or click, a customer could upgrade their service.

"We immersed ourselves into the natural experience -- the lives -- of our customers," Gurnani said. "That's the new, immersive engagement model that we're seeing."

4. Contribute to the top and bottom line

Rebecca Rhoads, CIO at Raytheon Co., says her team is "an integral part of top- and bottom-line results." For top-line value, Rhoads and her team help develop proposals, capture strategies and even evaluate adjacent markets to figure where to expand the company's footprint. When it comes to the bottom line, IT is also "expected to contribute, show up and be a part of optimizing everything -- from working capital to optimizing margins," she said.

Archive: MIT CIO Symposium

2013: The big data revolution

2012: The untethered enterprise

2011: The viability of IT innovation

2010: The CIO job under a microscope

The same thinking led Andi Karaboutis, global CIO at Dell, to ditch the company's IT steering committee. "I'm not a ship; I don't need to be steered," she said. In its place, Dell established the business architecture team, where Karaboutis and the business discuss business strategy and how they can enable people, processes, technology, tools and information to push forward on that strategy. As for how she and her department refer to themselves vis à vis the business?

"We never say they support the business; we never say they partner with the business," Karaboutis said. "Dell IT is in the business."

5. Hone your collective IQ

The social Web shows that leveraging collective intelligence can pay dividends, but how should CIOs refine that collective IQ for their digital enteprises? Thomas W. Malone, the Patrick J. McGovern professor of management at the MIT Center for Collective Intelligence, figured that if he could measure collective intelligence, he could answer that question.

Through his research, Malone discovered that "just having a whole bunch of smart people in the group doesn't necessarily make a smart group," though it is moderately helpful. He found three additional "statistically correlated" factors that influence a group's collective intelligence: social intelligence; group dynamics and gender. "If one or two people dominated the group conversation, then, on average, the group was less collectively intelligent," he said. Gender plays a role because "the group's collective intelligence is significantly correlated with the proportion of women in the group."

Women tend to score better than men on social intelligence tests, Malone said. Socially intelligent men could have a positive impact on collective intelligence as well, he added. "But if you know nothing about a person besides their gender, you're more likely to get that if you have more women."

Let us know what you think of the story; email Nicole Laskowski, senior news writer, or find her on Twitter @TT_Nicole.

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Are you talking to your boards about how to fight digital disruption?
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I suggested to my board (we are a bank in Cameroon) to create a digital unit directely related to the board to really take the digital threats and opportunities up front. They were no convinced of the emegency of the situation (in the banking sector in Africa, Telcos are already creating virtual accounts and people can transfer money from their virtual account to others, they can also pay for services using mobile money and Telcos are heading to other Financial activities; moreover Major High Tech firms like Apple, Google, Facebook, Microsoft are also entering the market of payments and transfers with a huge potential and are threatening the banks monopole on those Financial services and more).

Banks future seems very dull to me while the digital disruption is speeding up and as they stay quite conservatives (business model, work place, operations...) and don't seem aware of the threats and opportunities it uncovers.

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