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A new IT model and CIO role for the digital age

A former CIO and author lays out the blueprint for how to disrupt old-school IT.

The traditional model of IT is starting to look like ancient history, according to Ian Cox. And that isn't good for CIOs who still see their roles as technology and services providers rather than technology and services brokers, said Cox, a former CIO-turned-consultant and author of Disrupt IT: A New Model for IT in the Digital Age. In the digital age, businesses are looking to technology to create new products and services, not just enable them.

SearchCIO senior news writer Nicole Laskowski recently caught up with Cox to discuss what he sees as the new core competencies for IT, what CIOs need to do to transform their role, and why clinging to old-school IT is helping pave the way for a new C-level executive -- the chief digital officer (CDO).

The title of your book is Disrupt IT. Why does IT need to be disrupted?

Ian CoxIan Cox

Ian Cox: The rest of the business is shifting now and thinking about how it can use technology to create value and new revenue streams, new business models, and products and services and digital experiences around existing products. If that's where the rest of the business is focusing, then the CIO and IT function also need to be focused on creating new business models, and new products and services. That takes a slightly different style of IT than reacting to business need; it's about working alongside the business and looking for the next opportunity to use technology to create a new product or service.

Because of that, you need different skills. Rather than the hands-on, techie skills we needed in the '90s, IT -- while it's still a technical department -- [needs to] become more business-focused and to look at the IT skills required to add value to the business.

What are those skills?

Cox: In the book, I lay out the core competencies of the new IT department:

  • The first one is architecture and design. Digital business moves quickly, and it needs to be flexible and agile; it needs to be able to do things quickly and securely. You need to have a solid architecture in place so you can plug in a new solution, try something new, bring in a new data field, [and] potentially expose a new data field.
  • Having to do things quicker and in a more flexible way makes delivery management a core competence. And being able to manage project progress of all manners is a core competence.
  • Data is valuable; data is the life blood of digital business. Getting the right data to the right person at the right time is absolutely essential. So data management is a core competence – which includes how you collect, how you store, how you structure, and how you make it available [for] people to use.
  • The fourth core competence comes from the fact that we're using more vendors. It's vendor management. One of the things I recommend is outsourcing anything that isn't part of a core competence.

That's a lot to outsource.

Cox: There's clearly going to be things you can't outsource for regulatory reasons, legal reasons or the fact that it's just not economic because it's a really old system. But other than that, unless it's something that's truly setting you apart in the marketplace, and you want to keep it close to you, my challenge for CIOs is to stop spending precious time and resources on something that is not adding value to the business anymore and won't make you stand out from your competitors.

If you decided to keep something in-house because it's a differentiator, it should be reviewed every year because a differentiator this year may not be a differentiator next year. You'll need to shed that and move your resources to the next differentiator.

Where do you recommend CIOs get started with this "disrupt IT" transformation?

Cox: First: Don't be technical. Effectively, what I'm saying is you still need to understand technology as a CIO, but you don't need to know it to the level of detail or depth that you did for the last 10, 15, 20 years. You don't need to be a technical expert and build things from first principle; you need to have a full breadth of technology and, more importantly, you need to know how you can use that technology to create value for the business -- and you've got to be able to articulate that.

Disrupt IT

Second: Get non-IT experience. A growing trend among some leading CIOs is they've spent some time outside of the IT function in the rest of the business. A lot of them know what it's like to deliver a P&L [profit and loss statement] or attract and retain customers. That's important for two reasons: For the CIOs' credibility going forward, if they're brought into discussions in the board room about creating new products and services and new revenue streams, they're more credible if they've actually done it themselves and know what it's like.

Third: In the digital age, the CIO is a far more social animal. They're spending more time outside of the IT function working with stakeholders across their business, but also with the stakeholders outside of the business -- so customers, partners, suppliers. They're looking at that whole value chain, as we tend to call it, that digital ecosystem, and at how to generate value across it. And they're looking at what comes next -- it's a far more proactive role than waiting for someone in the business to find a new technology and opportunity. Instead, it should be the CIO thinking a year or 18 months out about what's coming and how to introduce that to the business, and how to collectively work out whether it's relevant to them.

Is the emergence of the chief digital officer a byproduct of the still-lingering old-school IT model?

Cox: I sit on the judging panel of the CIO 100 in the U.K., so the top 100 CIOs [in the U.K.]. And, in my estimate, based on what I see from their submissions, only about 20% of them are the new-style CIO, or are on their way to being one. That leaves a large majority of CIOs who are not currently working this way. And they don't have the skills or experience -- or even the capabilities at the moment -- to be that kind of new-style CIO. A lot of CDO-type roles are borne out of frustration of CEOs who know they need to be doing something but don't have an executive they feel can drive that kind of change forward.

In part, that's because traditionally, the CIO role has been very much inward-looking in terms of controlling what the company is doing as opposed to growing the business. So, CIOs haven't developed processing skills, resources and structures to do that, and I think they're being called out a little that the role is changing around them.

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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Read more from our New Books series, including Q&As with authors Tom Davenport, Ben Yoskovitz and Mark Hopkins.

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Do you agree with the premise "business first, technology second"? Why or why not?
it is unfirtunately not a clear cut decision. it depends on the level of maturity of the business. i am tempted to add business type as well but it is more of maturity than business type. on the whole it helps to consider it in the same breath as the business, i.e. NOT second but equal first
I've written about some of these topics in the past:

- New Business Models - https://itknowledgeexchange.techtarget.com/cloud-computing-enterprise/the-new-rules-of-it-are-new-business-models/

- New IT Tools - https://itknowledgeexchange.techtarget.com/cloud-computing-enterprise/the-rise-of-the-saas-management-tools/

- IT Job Opportunity - https://itknowledgeexchange.techtarget.com/cloud-computing-enterprise/cloud-means-change-and-opportunity-if-you-want-it/

- Transform IT or the Business - https://itknowledgeexchange.techtarget.com/cloud-computing-enterprise/transforming-it-or-transforming-the-business/
Too many decisions are predicated on the technology,rather than the actually operations a business wants to perform. While it's not possible to completely place technology second, it's vital an organization figure out what it wants to do before it invests heavily in any infrastructure that "may" give it what it wants.
One area that needs challenging is the reluctance to be open minded, and the be willing to change strategies in order better suit the business requirements. Keeping a close watch on the progress of technology is important, but should not dictate direction. Alas, I have seen the effects of trying to ignore customers who actually know far more about how they need to work than IT is willing to cater for. The consumerisation of IT has changed the backdrop completely, and if IT Departments don't become more flexible they look stupid. I had an ex Head of IT who thought that raising the possibilities of Apple's strategies and products was not worth mentioning - indeed he felt it was 'confusing'.  The same person lost control of BYOD in schools - a near disaster. Instead of looking at what was driving the customer moves, he just didn't want Apple technologies. Such a shame - it held Blackpool Council back.  This outdated attitude is particularly limiting when it is actually the fear of new ways of working that are the source of the fear.  
The reason I think the business is the First is because more the business is successful will give you the possibility to move with the new technology. Any reluctance to the new technology should be treated as an exception and correct it immediately. 

I would say Business and Technology shares the slot, not like one first and the other second. 

Even though, the above has always been the actual fact, reality is the business mentality attained more maturity long time back than how technology evolved in past 20/30 years. 

However, anyone would acknowledge the better fact that ever since technology was considered, it has always proved that it is an enabler if applied in the right manner and right time. 

Rather it is such a fantabulous enabler of business the gains from it is mega-exponential in most cases compared to without right technology. 

Hence, I think smart business owners in current era, would probably think what is the right technology and when and how to use it? How do we couple it seamlessly with business? Is it a core competency or is it an enabler that should be outsourced? These would be the questions....

Absolutely - we need to think big in terms of how to create value for our companies, start small with key pilots, fail fast where required and then for the successful pilots scale quickly - all of this takes real business knowledge coupled with the background of being a good technologist not a techie - for me that has always been the rtole of a CIO
In this day and age, you need understanding of both to stand a chance of making sound decisions. So for me not a choice between the two, but how you bring the two together.
I apologize for not knowing which C-suite role the "CIO" replaced some years ago, yet it seems reasonable to conclude that this article was valid at that time. Surviving and keeping a C-seat applies to all functions that report to the CEO. However, the notion that the company and you as the CIO can take for granted the IT function, presumably because it's being run by people who actually have technology depth and keep current, makes sense if and only if you as the CIO aspire to be the CEO. When articles suggest C-seat executives can wander away from their specialty what they actually mean is broaden your perspective and value to the company so you become a candidate for the next level.... because industry hype indicates that the function you represent is no longer the strategic differentiator it once was.
I think this article is spot on. I’ve noticed this is developing as a trend over the last several years, and have been able to witness it first-hand over the last 1.5 years. Our current CIO comes from the business, and plays a key role in not only leading IT to be more business-focused and learning the IT skills required to add value to the business, but also repairing IT’s relationship with the business, helping IT transition from the technical department that produced solutions they thought the business needed to a true business partner, working with the business to deliver new solutions and revenue streams.