One of the most common questions I get asked is “what is the transforming role of the CIO?”
It’s no surprise that this is top of mind for CIOs. In fact, according to a recent CIO.com survey , 45% say that becoming a “transformational” CIO is their number one priority for 2016. This rate is even higher than being a “functional” or “strategic” CIO. But, transformational is a very broad and non-specific priority. So what does it really mean to be transformational?
For years we have been talking about CIOs aligning with the business and how they should be focusing their efforts on what matters to business stakeholders. This is critical for success but it has now become table stakes. It’s synonymous to power windows, keyless entry, or even back-up cameras on new vehicles. You simply expect those items, just like you should expect any modern, effective CIO to be aligned with the business.
It’s true many organizations still have challenges with alignment and it is still a noble effort. However, the problem with alignment is that it is typically a “follower” or “reactive” mentality. The trap many run into is asking what the business needs and then following in their footsteps by delivering technology, projects, or infrastructure. It is not a “leader” mentality and still portrays the CIO as a cost-center, roadblock, or services-to-hire organization. CIOs are supposed to be leaders, not just technology leaders, but also business leaders with a seat at the strategy table. CIOs must transform their approach by driving more business initiatives and strategy, not just technology.
Let’s take a look at how you might be able to do this.
Create Your Own Value
While there needs to be collaboration, support, and alignment with the business, CIOs should be thinking beyond this and more about how they can create their own business value. You are probably thinking that CIOs do create value by delivering projects that save money, help scale the infrastructure, or simply increase the speed of system performance. However, these are typically focused on driving technology initiatives that were asked of the CIO and their IT teams – not necessarily suggested or driven out of the office of the CIO or the IT project management office (PMO).
As a CIO, you have access to project and resource data, enabling you to be more predictive by forecasting where the business should go to generate more business value. By leveraging a project portfolio management (PPM) solution for synthesizing the data, CIOs put themselves in a position to create value in the following ways:
- Justify which type of resources stakeholders need to hire and when
- Provide predictive insights into the impact of decisions, such as eliminating an application or reassigning a critical resource
- Predict the optimal portfolio roadmap, given current and future resource constraints
- Forecast how the organization is doing against goals and make decisions to get back on track
CIOs have the ability to “look around the corners” and provide more meaningful insights to drive the strategy forward. The key is to leverage data and change the mindset from merely providing value to creating it.
Think Outside In, Not Inside Out
Too often CIOs think in terms of process, tools, training, and best practices, causing their PMOs and teams to think “inside out.” This type of thinking quickly focuses attention on the organization and tries to solve internal challenges, which leads to asking the wrong questions like:
- What methodology should we adopt (i.e. agile or waterfall)?
- What certifications should we have our team members obtain?
- How do I get the organization to standardize on a particular tool/technology/application?
The alternative approach is to have more of a customer mindset, where you are solving business problems and not just internal inefficiencies. While there are merits for solving both internal and external challenges, most commonly the focus is on internal challenges. In fact, according to Forrester’s Global Business Technographics Budget Survey, business decision-makers say 69% of their IT spending is focused on ongoing operations and maintenance or replacement and expansion projects – mostly focused on solving internal challenges. By taking an “outside in” approach, CIOs will find themselves asking questions like:
- What are our strategic initiatives?
- What are the right programs to make the biggest impact?
- What do our customers need?
- How can we increase customer satisfaction?
- How do we help the organization meet business goals?
- How do we prioritize work based on value, not just urgency?
Turn the inside out perception around by asking questions that are focused on the outside in.
Continuous Planning and Value Delivery
The industry has been conditioned to think about IT and PMOs as project and task delivery machines. Too often these teams are handed work and asked how quickly they can deliver it. The focus is on “how” and “what” will be delivered and not “why” it is important. The value of the “why” gets lost because by the time it comes to the CIO’s team, it has already been decided and the focus is on execution. Transformational CIOs need to change the mindset of their colleagues by focusing on value delivery, not around delivery of some arbitrary project or task.
The primary way of doing this is to increase agility into the planning and initiation of work. Markets change, customers come and go, and strategy shifts occur as you go through the course of the year. Many times organizations “get stuck” with their current work, even though some market change has taken place. Most CIOs have not incorporated business agility into their processes, leaving their teams to simply carry on with the work until it is complete – even if it no longer adds value. Without a culture of accepting change or having the proper tools in place to reallocate resources, organizations cannot focus on delivering value. By enabling your team with portfolio and resource planning solutions, you are facilitating their decision-making and recommendation abilities around value delivery and not just focusing on the task at hand.
A major part of increasing agility is for CIOs to move towards continuous planning cycles by eliminating the traditional annual planning process. During normal annual planning cycles, value typically takes center stage and is maximized. However, the key assumption is that the value compass does not move as you enter the execution phases of work. By incorporating continuous planning, you establish an organizational culture where value is consistently discussed and decisions are made around maximizing it. When you move planning to continuous cycles, both existing and proposed projects are reviewed together. Even if a project is mid-cycle, your team will discuss the merits of continuing to execute or reallocating resources to higher value work. By highlighting value as the metric for deciding to start or continue work, CIOs will transform how they strategically drive the business.
Transforming the role of the CIO requires changing the focus to value creation by thinking outside in and enabling a culture where value delivery maintains focus through continuous planning.
For more on this topic, watch our recent webinar where Margo Visitacion, principal analyst at Forrester Research, takes a deep dive into how to transform the role of the CIO and how IT can play an intricate part in creating business value.