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CIOs at companies where digital transformation is a top priority should aim to spearhead this change, according to new research out of Deloitte. They can start by helping their business peers understand the foundation of digital transformation, not just the aspect most closely aligned with their respective departments.
"A CFO, for example, may only be focused on analytics as a way to drive insights into the business. Or a chief operations officer may only be focused on ways to drive efficiency through technology and so on," said Khalid Kark, U.S. CIO program research leader at Deloitte LLP and a co-author of the 2016 to 2017 global CIO survey Navigating legacy: Charting the course to business value.
What they see is the tip of the digital iceberg, according to Kark. Under the surface, digital transformations are upending systems, processes and technologies -- all of the places where CIOs operate. "Our conclusion was that CIOs are best equipped to handle this mass transformation of [a] business ... because they're able to look at the whole iceberg," he said.
The unique perspective of CIOs represents an opportunity to create long-term value for their organizations, or what Deloitte calls a CIO legacy. Moreover, building a CIO legacy doesn't depend on the chief information officer's personality or personal working style, Deloitte has concluded. "What matters is that what you're developing and what you're building right now is in response to the business need," Kark said.
The CIO Legacy Project
Last year for its CIO Legacy Project, Deloitte researchers wanted to pinpoint the methods, tools and competencies CIOs used to create value for their organizations. "To a little bit of our surprise, there wasn't a lot of difference across industries and geographies," Kark said. Instead, they uncovered three roles that CIOs take on to do this -- the trusted operator is focused on operational excellence; the change instigator is focused on business transformation; the business co-creator is focused on revenue and growth.
This year, researchers wanted to know what characteristics are associated with each of the three "pattern types," be it personality, leadership skills, working style or IT capabilities. They hypothesized, for example, that trusted operators would be more risk-averse and less outgoing than change instigators and business co-creators.
But, again, to the researchers' surprise, personality had less to do with how CIOs help to push the business agenda forward than their ability to align IT strategy to business goals, deliver on that strategy, develop a vision for the department, build a strong team and foster a culture of innovation. The research showed that these abilities were not exclusive to just one personality type. "This is actually a good thing for CIOs," Kark said. "A vast majority of the efforts they put in -- in terms of building personal competencies and building IT capabilities -- allows them to drive the value and impact that they want."
The digital opportunity
More than finance, marketing, HR or operations chiefs, Kark contends that CIOs have a better grasp of how to drive digital transformation because they understand that what goes on in the front office with customer-facing tools and technologies has a ripple effect into the back office. Once CIOs realize that digital leadership is tied to their ability to clearly see the scope of digital transformation, rather than to personality or a particular leadership style, they should feel more confident about driving digital transformation, he said. Not that it will be easy or quick or inexpensive.
"When we talked to CIOs and asked them about the significance of change they're going through, we realized all of that huge transformation -- all of the investment in legacy, in core modernization -- was the highest level of investment," he said. "And the reason for that was that the front-end digital was driving a lot of back-end changes in terms of systems, processes and technologies."
Khalid KarkU.S. CIO program research leader, Deloitte LLP
Indeed, CIOs can't do it alone, Kark said. But they can bring the leadership together to talk about digital transformation, a conversation that should begin with coming to a consensus about what digital means to the company. Doing so will ensure employees don't talk past each other, initiatives don't overlap and the legacy infrastructure won't become too complex and hard to manage.
There's another plus to taking the lead on explaining the roadmap to digital transformation and driving the process. CIOs can use digital transformation as a stage to redefine or expand on their traditional roles as trusted operators or as IT change instigators to become business co-creators. The key is not to be pigeonholed -- by themselves or by their business peers. Deloitte's research found that the most successful CIOs are the ones who can move between the three pattern types depending on the current state of the business.
"A CIO that's adaptable is much more likely to succeed than a CIO who is fixed in terms of not being able to learn new skill sets or new capabilities," Kark said. "You've got to adjust to the changing business needs. And if you do, you'll succeed."
As such, CIOs can't simply focus on operations or solving current problems; they also need to be proactive, according to the report. "As leaders within their organization, CIOs need to drive the business understanding of the latest and greatest technology, influence organizational leadership to use technology to support business needs, and advocate for appropriate technology deployments," the report reads. "Each CIO should think of himself or herself as a business leader and start setting their course based on an understanding of both present and future business priorities."
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