A thought-provoking report commissioned by Sungard Availability Services, ‘Digital dynamics in the C-Suite: Accelerating digitisation with the right conversations’, indicates the time is right for collaborative working models between IT and the business, but also warns if CIOs want to keep their seat at the boardroom table they must take the initiative and claim a true leadership role rather than be side-lined into a technology silo.

Report author Professor Joe Peppard of the European School of Management & Technology explains that in the past a CIO’s key focus would be on aligning IT with business needs. Typically, this meant taking the business strategy – which they had little influence on – and then determining the investment portfolio for IT. He argues that when the ICT strategy is subservient to the business strategy in this way it effectively turns the CIO’s role into being little more than an order taker. With ICT needing to be integrated into the very fabric of the organisation IT should be part of the strategic management and thought processes of the organisation whereas, in far too many cases, it is an afterthought.

Digitisation – opportunity or threat?
Today, the concept of ‘digital strategy’ is emerging to supplant what was previously ‘the IT strategy’. Most businesses today are – or, at least, are becoming – digital businesses. No industry it seems is immune to the realities where business processes, value proposition, customer experiences, products, services and management practices have been or are being transformed by the internet and other digital technologies. Yet most CEOs and their boards are unclear on how best to respond and where investment will deliver the best returns and clearest customer benefits.

Professor Peppard believes this presents “a unique opportunity for CIOs to elevate their influence in the organisation and drive the digital agenda.” However, they cannot do it alone, but require the active involvement of both the CEO and C-Suite colleagues. Success with ICT is a shared responsibility. The problem is, of course, that many others in the C-Suite don’t quite see it this way and if they are determined to see digitisation as solely a technology issue, then the real benefits of digital technologies are unlikely be realised.

In his report Professor Peppard cites the emergence of digital cameras as an example of both the opportunities and threats presented by the age of digitisation. With the ability to take photos built into smartphones, we can record the time a photo was taken, its precise location and also share it instantly. This has spawned new businesses such as Instagram, Picasa, and Snapchat and new entrants such as Sony and Samsung – but also the demise of one-time industry powerhouse Kodak. A cautionary tale illustrating the consequences of failing to adapt to the modern world and a convincing demonstration of the need for business agility.

Ironically, this renewed interest in ICT and digitisation comes at a time when the CIO role is facing a number of challenges. Firstly, some CIOs have found themselves being dropped from their seat at the top table, and instead reporting into the CFO. Secondly, with the growth of cloud and ‘shadow’ IT, more and more IT spend is occurring outside the remit of the IT function.

The report wryly notes one analyst predicts by 2017 the Chief Marketing Officer will spend more on IT than the CIO! And, there is even evidence of the newly-created role of Chief Digital Officer displacing the influence of the CIO.

A juggling act
CIOs face conflicting demands. On the one hand, they must provide cost-efficient, predictable IT services while, on the other, they are expected to ensure the company’s IT estate will be responsive and agile. Trying to balance “keeping the lights on” with innovation is a constant challenge for CIOs.

Perhaps the most difficult challenge CIOs face is the low level of digital literacy in the C-Suite. Even executives who class themselves as ‘tech savvy’ often base that assessment on their experiences with consumer IT. Many use smartphones, tablets and office productivity tools, download apps and even set up their own home routers for broadband, but this does not necessarily qualify them to understand how to manage IT at an enterprise level.

Exploring why other C-Suite executives tend to side-line IT, the report suggests they often feel very exposed when having any conversations to do with IT as they consider themselves to be technically illiterate. Perhaps understandably, the easiest response is simply to delegate – or more often, abdicate – responsibility for anything IT-related to the CIO including governance.

CXOs must recognise that there is a seismic shift in the role of technology in organisations as it becomes more and more embedded in everything we do. Decisions about IT today really have little to do with technology. Rather, they are about competitive advantage, business growth, cost reductions, flexibility and responsiveness, margin increase, and productivity improvement.

Collaborative working relationships between the CIO and business colleagues are essential to harness digital opportunities and optimise the value from ICT investments. But it would not be an exaggeration to say that the relationship between IT and the rest of the business has been a troubled one and many CXOs do not see the CIO as an equal. The 2014 State of the CIO survey confirmed that half the CIOs surveyed view IT as a service provider. There may also be entrenched views to break down. Years of resentment and negative perceptions, often based on project failures attributed, rightly or wrongly, to IT, may have built up.

In an effort to address these thorny issues the report ends with some pragmatic guidance for CIOs to help them achieve the transformation from a mere service provider to a respected C-Suite colleague who has a valuable role to play in shaping business strategy.

Visit All-time.co.uk to review Joe Peppard’s top 10 tips for the C-Suite in our ’Digital Dynamics in the C-Suite’ e-Book.

If you would like an exploratory discussion with a member of our Consultancy team about increasing your business agility, please call +353 (0)1 467 3650 or email infoavail@sungardas.com