Five CIO tips for building an IT strategy in the digital age

Create a single business strategy that covers digital trends

Former CIO turned digital advisor Ian Cox says disruption usually happens in industries that have not seen any major change in business models, products and services for prolonged periods. In fact, he has strong words for people who hype transformation.

“Disruption is nothing new,” he says. “For as long as businesses have existed there has been disruption. And the disruption has usually been made possible by technology in some form. But the power of IT is undoubtedly much more relevant in the digital era.”

One approach some CIOs have taken is to develop a digital strategy that is separate to the firm’s overall approach to IT. But Cox is adamant than no separation should exist. In fact, he believes a CIO’s approach to technology should be integral to the broader business strategy.

“What every organisation needs is a single business strategy, and the CIO should take part to provoke debate and extend capabilities,” he says. “The modern CIO should be a person who knows what’s coming in terms of IT and the startup community.”

Use IT to improve operations and boost organisational value

Andy Wilton, CIO at Claranet, says that for all the fluffiness of the term “digital”, its adoption has affected one important change – the line between IT and the other departments of an organisation has been blurred to the point that a demarcation no longer exists. “Today, your industry determines your IT strategy, not your department,” he says.

Wilton has seen huge change in the technology industry, yet he believes retail is probably the best industry-specific example of where CIOs had to significantly adjust their strategies. He says the ease and efficiency that comes with in-store digital devices – and the boon of online ordering and automated processes along the supply chain – have driven huge growth.

However, he says not every sector is changing in the same radical way. He points to the motor industry and says that – despite advancements in car modelling and customer relationship management software – there have been fewer changes to the fundamentals of manufacturing, so the industry’s rate of change has not been as great. “Business value and digital growth are not always directly connected,” he says.

Wilton says this lack of connection means C-level executives, who are all too eager to sling buzzwords to mask their lack of activity, need to proceed with care.

“There’s no single label for digital,” he says. “The pace of change is instead largely determined by direct business value of certain products and how IT can seamlessly connect and improve operations, rather than a need to overhaul an entire business model.”

Give technical information to executives in a meaningful way

Richard Norris, head of IT and business change at Reliance Mutual Insurance, joined the business in late 2014 and was tasked with transforming a legacy IT operation. The programme helped create a platform for change, both in technology and human resources.

But despite the focus on all things digital, Norris must keep a watchful eye over more traditional operational IT concerns. The legacy business – the firm’s long-standing insurance clients – remains an important element of Reliance’s strategy. The reformed technology organisation now serves two roles – first, supporting existing systems and clients of Reliance; and second, supporting the development of website There.co.uk.

Norris recognises that strategic development plays a key role, both in terms of his own approach and the skills of his IT team. “I’ve brought Gartner in to mentor people inside their departments and to help them understand how IT can be used to make the business more efficient,” he says.

“By developing experience in other people, I can reduce the pressure on me – and I can focus on areas that will really make a difference in terms of competitive advantage.”

“By developing experience in other people, I can reduce the pressure on me – and I can focus on areas that will really make a difference”

Richard Norris, Reliance Mutual Insurance
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As a CIO at a digitally engaged business, Norris recognises that he focuses his IT leadership on human co-operation, rather than systems engineering.

He believes this transition from bits and bytes to communication and collaboration is far from unusual. As an individual moves up the IT career ladder, Norris says he or she starts to leave the technology behind. However, a smart CIO will always keep one eye on IT.

“I’ve worked hard to develop my people and relationship skills, but I’ve also always strived to ensure that I don’t leave my technical awareness behind. I still speak to enterprise architects about governance concerns, for example,” says Norris.

“I can play that information back to the rest of the business in a meaningful way. I can go to the business with a good understanding of how the available technology might be used to help meet key executives’ aspirations. “

Make line-of-business functions choose their own systems

Since joining the company in 2012, Chris Hewertson, chief technology officer (CTO) at hotel group GLH, has been at the forefront of an organisational transformation that has put customer experience at the centre of the firm’s business strategy. The hard work began in spring 2013, when he started making decisions regarding the future direction of IT in the business.

“We started with a fairly traditional technology roadmap,” says Hewertson, who recognised that cloud would play a crucial role. “We came up with an output that, to a greater or lesser extent, was implemented. But rather than simply implementing that plan, we did something different – we stopped.”

Hewertson says the technology strategy that was originally created felt too focused on the core of the business and too traditional.

“If we wanted to transform our revenue-generating businesses, we realised we’d have to give the hotels the power to decide which systems they would use. Rather than focusing on the core, we started to go from the outside in,” he says.

“The business has chosen its own technology. We handed over what was the historic responsibility of the CIO. But this is what every IT leader should want the business to do”

Chris Hewertson, GLH
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Hewertson ran a project called Ship Alongside, which recognised the existing capability of the hotels was so broken that the IT team would need to bring along a new ship, kit it out, move everyone over to the new platform and sink the old way of operating.

Looking back on the project, Hewertson says the approach of the project has been transformative. “There’s hardly a service in the hotels that hasn’t changed,” he says.

“We got three competing teams of individuals from across the IT department and business and paired them off with technology partners. They were tasked to find systems for different areas of the business and they evaluated hundreds of services.

“The teams were very passionate and their competitiveness drove them to find innovative solutions to our business challenges.”

Hewertson says these competing teams had many dialogue sessions across a three-month evaluation period. After each team sent back their findings, the senior team at GLH merged the output from the groups. He and his peers then evaluated the shortlisted systems and implemented the technology.

“The benefit of this approach is that the business has chosen its own technology,” says Hewertson. “We handed over what was the historic responsibility of the CIO. But this is what every IT leader should want the business to do – to step up, to engage and to be clear on what it wants.”

Work in an agile way to deliver to high customer expectations

Andrew Agerbak, associate director at Boston Consulting Group, says the business opportunities that can come from digital transformation are enormous. He says change is allowing some of his firm’s clients to take as much as 30% out of costs – and agile development plays a key role.

“It’s hard – transformation can’t be done in a siloed way, like traditional IT development,” he says. “You have to work across sales, marketing and operations – you have to create alignment and a consistent way of talking about the customer. There’s a lot to do to deliver true digital transformation.”

Agerbak recognises that modern customers have changed expectations. IT is no longer about internal technology requirements. “If your online banking app is being evaluated in the App Store, then the stakes are considerably different. People want everything to be simple and intuitive. And outages are completely unacceptable,” he says.

To create a strategy that delivers high quality services, CIOs must help the business to become more agile and to feel more comfortable with experimentation. “You have to show the product regularly to customers before it is scaled-up,” says Agerbak.

“You have to prioritise your actions in response to feedback. Have a strict definition of what ‘done’ means. If you’re looking at changes on a two-week basis, you get better at tracking changes and analysing accuracy over time. You start to move to a much higher level of accuracy.”