Restructuring IT for Digital Transformation
Businesses need digital transformation to survive. That is probably an age-old dictum that has a variety of real-world examples, success stories, or cautionary tales. If you keep on doing the things you have been doing for a long time, then even the tried and tested will fail. Along with the changes that a business needs to undergo, roles are also changing.
These changes are essentially true with IT. According to CIO.com’s 2019 state of the CIO survey, technology leaders are expected to lead digital transformation initiatives in their respective organizations. More than a third, or around 38 percent, of chief executive officers, are counting on their CIOs to transform the business digitally. An overwhelming majority or approximately 88 percent of these chief executives are reporting that their CIOs are more involved in this initiative than any other role.
CIOs are also open to taking on new responsibilities and roles. More than six out of 10 are accepting data analytics as part of their jobs, while 32 percent are delving into customer service. Around 38 percent are doing business development. More than four out of 10, or 43 percent, are involved in operations. In short, CIOs are doing things that are outside of their traditional responsibilities.
If you zoom out of this, you would see that CIOs are now being tasked to find new avenues for business to generate income. When it comes to IT, it is no longer just ERPs, systems, infrastructures, programming, or development. They also need to fulfill the roles of being an advisor and an enabler of innovation. This is where technology can be used to solve problems or earn more.
Changes in the organization follow this thinking
That shift in the CIO’s role needs to be followed by changes in the organizational structure and processes. For instance, in one company, IT is no longer just part of support services, like human resources. Instead, they are treated as a shared resource that can be tapped in different projects for different departments.
Organizations now have different IT teams. These IT teams will include technology and business leaders, technicians, and programmers. Today, it is easy to find a frontliner who also handles customer service as part of an IT team.
These frontliners and other people from the operations side of business are the ones who know how the organization works. They are the people who interact with customers. They are the ones who are implementing the different flows and processes that help the company keep its doors open.
For instance, a retailer will have an IT delivery team that will include the usual suspects: the CIO, programmers, systems engineers, Web site developers, and other technical staff. But that team will also include the store manager, or perhaps a sales clerk. These non-conventional IT team members are the ones who can understand the customer better, so their inputs in creating a customer-centric IT solution are valuable.
Business-savvy, customer-centric IT
As the shift happens, we would be seeing IT teams that are business-savvy and focuses more on the customer than ever before. IT teams will need to speak the same language as the frontliners and those who handle the operations. This should have been the case long ago. IT has always been there to support operations. They are the ones designing, creating, and maintaining the systems that businesses need to interact with their customers. They are the ones that create the applications that customers use.
In the old scheme of things, IT personnel are out of touch with what the customers want and need. This is because they do not interact with them. What’s more, IT personnel do not work closely with frontliners who know the customers inside out.
However, with this new scheme, IT groups now have a frontliner or two as part of the team. As such, there is no disconnection with what the customers expect and what the IT teams deliver.
IT teams will no longer be geared towards stability as it was in the past. Instead, they will be focused on your business’ digital transformation. Because IT teams are now similar to a product team, they can quickly pivot and change directions. When developing a new product, you often have quality assurance processes and testing. These processes are used over and over for different products that are developed.
Now, imagine having IT teams that work that way. You can have processes that can be used in delivering a retail app, an HR system, or a supply chain technology. That can do wonders for scalability. What’s more, because IT teams are responsible for “products” they will tend to focus on the projects that will bring the highest potential outcomes.
IT is now tied to business outcomes
Which brings us to the next more important point: IT culture and mindset also need to change in order to achieve digital transformation.
In the past, IT teams evaluate success or failure on whether or not they can come up with the application on time. But in the new way of doing things, IT projects are only successful if they deliver the desired business outcomes. With this new mindset, IT projects are not gauged on whether it has gone live or not, but whether it helps your business increase productivity, save on costs, and other vital goals.
As such, businesses need to stop thinking about user requirements and start thinking about business requirements. Your IT initiative should allow for innovation to come through. In the past, you badger the IT staff for an application to capture customer data, record their sales, and other requirements. Now, you need to look at requirements and tie them to a business need, such as minimize customer turnover, increase customer retention, or make it easier for people to buy from you so that revenues are increased.
The company of the future will rely on IT to head their digital transformation.
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Each company will have to figure out how to restructure their IT for digital transformation. There is no one formula or recipe that will fit all organization. You will need to determine what structures to use, what skill sets to cultivate, and others.
Regardless of your setup, however, you will need to ensure that you do not put your IT teams in silos that separate them from the rest of your employees. Instead, you need to ensure that things are fluid as it makes way for more scalability and agility. As such, it is not only IT that you need to restructure. You will do best when the whole organization evolves.
Photo courtesy of Altimeter (from Flickr).