Technology, Cloud

Ready, Set, Go: CIO’s Top Ten Challenges

Will the CIO and IT departments be left out or more strategic focused and mission critical?

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Today’s CIOs and IT departments are at the cross-road: on the one hand, digitization and globalization make the technology more critical than ever, IT capability becomes the competitive differentiator, information/data just penetrate into every corner of their organization and our human society; on the other hand, the latest technology such as cloud/social computing unleash the potential to decentralize the enterprise, and democratize our working environment, will IT be left out or more strategic focused and mission critical? Here we list the top ten challenges facing in today’s CIO to provoke the further discussion.


1.     Cloud Strategy & Solution
Cloud becomes omnipresence these days, the power of cloud computing  is to provide the convenience for enterprise to proactively deliver the customer-tailored solution with speed, to calculate the IT performance/cost more transparently, to transfer the IT investment from CapEx to OpEx, to transform IT department from cost center into integration & innovation center.  In one sentence: Cloud helps build up the value-driven, capability-enabled agile enterprise.
So the top challenges facing CIO is not: when to step into cloud, more about: HOW: SAAS, PAAS, IAAS, BPAAS (Business Process As a Service), AAAS (Analytics As a Service), also: public, private, hybrid, community cloud, etc, CIO need leverage many key factors such as security, privacy, cost, availability, vendor reliability, SLA., etc, to make the cloud transformation as both strategic imperative and operational effective. 


 2. IT Maturity
Every CIO may need evaluate IT’s maturity level base on criteria Gartner defined: Five level maturity (functional, enabling, contributing, differentiating, and transformational). The reality is majority of enterprise is struggling at level one: functional –IT as commodity to keep the light on, or the level two: enabling, IT intend to become the enabler for business, reliably and predictably delivers technology services and solutions on demand.
However, it’s far away from satisfying both internal business customers and end customers in this “Only Change is Constant” digital era, the goal for IT is to pursue:
Level 3:  IT is engaged in addressing explicit business problems or opportunities. Its contributions to business performance are well-understood
Level 4: IT is a source of agility and product/service innovation. IT collaborates with other disciplines, such as R&D, BPM, and OT, to deliver new products, services and differentiating operations.
Level 5: IT is a primary driver of business model innovation. IT reliably and predictably delivers technology services and solutions on demand.
 
With IT capability upgraded to the higher level, the role of CIO will also become more strategic with business accountability.
  
3. Big Data Analytics
The Cloud/Social/Mobile computing not only bring up unprecedented opportunities for business via advanced analytics, the business is no longer satisfied with the hindsight or operational insight the traditional BI delivers, they are more interested in knowing what’s in customers’ mind: both positive and negative feedback;  what’s the products & service trends in the future. what will the business act for the next step to embrace the change., etc, , invest the trend, not just your core business, it’s the mantra in today’ business environment.  Predictive/prescriptive/Big Data Analytics will help the organization ride the wave, build the instant-on intelligent enterprise.
Big data also means big risks and big challenges: data management solutions such as data storage, data quality/optimization, MDM, data integration, data security/governance., are one of the top priorities for CIO and IT department to focus on, to breakdown the department silo, let the data flow cross the border, and keep organizational data asset both safe and clean with holistic view.

4. Application Modernization
Being agile and dynamic is the ultimate goal for today’s enterprise, application portfolio have become the integral components in an enterprise’s flexibility and capability, outdated legacy applications no longer meet business needs and  manifest poor performance, they also limit the organization’s growth potential. Many complaints about the sun never set for the legacy app due to the variety of reasons (life cycle, inertia to change, etc), CIO need a to-do list to manage the application modernization with both short-term budget planning and long-term TCO perspective.
 Cloud computing also provides the great opportunities for the organizations to integrate and optimize the application portfolio more strategically.
5. Security and GRC Management
GRC-Governance, Risk-Control and Compliance is increasingly critical in this interconnected, digitized world, since it helps organizations manage across areas including standards and regulatory compliance, auditing, policies, procedures, authentication and authorization, simply put, company make money by taking intelligence risk, and lose money by failing to manage the risk intelligently.
The effective Governance architectural framework and the latest GRC technology will help organization focus on risk mitigation and risk avoidance, manage the risk efficiently and effectively to both existing asset and future growth.
6.     IT Strategic ROI
 
 Today’s CIO is just such a paradoxical role: many personas, both hands full, very full...    
In this globalized, digitized and post-recession era, they are at the pressure  to demonstrate the value of IT, to create the synergy and differentiate capability for the business growth,  CIO need craft the IT investment portfolio with CEO and board’s business agenda, to deliver the strategic value for both today’ execution and  tomorrow’s growth. Cloud transforms CapEx to OpEx, to make IT investment more transparent and measurable.
The next logic scenario would be: How does CIO define the right sets of KPIs to demonstrate the IT Value? The traditional KPIs are the sets of  “Keep the light On” parameters, the next generation of IT KPI need be more strategic and “forward-look”,  IT metrics need discover the organization’s key competency such as:
·Customer Satisfaction
·Organizational Capability
· Agile/Speed
·Profitability
·Risk Mitigation
·Cost Optimization
·Fiscal Health
·Performance Benchmark
7.    Business Process Optimization/Innovation
CIO is just at such a unique position who can oversight the organization with holistic point of view, since information is penetrating all over the company. How to cognize the knowing from flowing, and optimize the business process, it’s the focal point to framework the customer-centric enterprise with outside-in perspective. BPM is actually one of  the top priority at most effective CIO’s agenda.
Today’s BPM is more about process automation, the next generation of BPM should more focus on process optimization, innovation, and  business transformation oriented-since digitization, globalization, and decentralization is organization’s new DNA in 21stcentury 
8.  Green IT/Sustainability
 
Technology and digitization are moving our society into the lower carbon, sustainable economic era, now PEST –Politics, Economy, Society and Technology are more interwoven than ever, green IT/Sustainability is beyond just social responsibility, it’s also organization’s new growth engine, the new gold mine deserve to dig deeper.
And IT plays the pivotal roles to orchestrate the energy-efficiency. sustainable-savvy, and resource-optimized modern organization, the high-performance enterprise should recognize the integrated connection between its supply chain and sustainability, and deliver the next generation of technologic solution to fill out the gap and optimize the process.
9  IT Talent Management
 The pressures of globalization, the update technology, the changes in workforce demographics and even the nature of IT work itself have made talent into an  organization's most important competitive asset, how to leverage the talent into the business strategy and long-term capabilities, and establish the talent power house, it's another great challenge facing in today's CIOs. 
 However, too many organizations just have very silo HR systems, processes and  practices, still treat talent as human resources with old-fashion way to recruit, retain, training and rewards, and have not focused on building those capabilities sufficiently. The latest technology such as social/enterprise 2.0 tools provide the huge potential to revitalize the talent solution by shaking up the current talent pool, exploring the multiple channels with open mindset, and decentralizing the workforce with self-management capability.
10. IT Culture Asset
As old saying, culture eat your strategy for breakfast, and your process for lunch, overall, about 50% projects have not achieved the satisfied goals due to the culture and change management failures.
Learning, analytics, dissent, cognizant difference, and diversity., etc are the strategic culture asset need be reinvented and inspired in the new digital era. IT is no longer just a invisible back-office function to keep the light on—and not feel appreciated with victim mentality.
IT should even become the secret sauce to polish corporate brand through all sorts of digital channel, with entitlement mentality, effective tools and empowered talents.. 

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Discussion
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pcalento
Paul Calento 256 Points | Mon, 08/29/2011 - 15:25

I think a CIO's biggest challenge today is relevance ... the same as its been since the position started becoming commonplace in the late 80's. You've broken down the CIO's responsibilities exceptionally well in the cloud era. But the challenges that the business has are more pragmatic  ... which subseqently connect with your items in the excellent Top 10. An IT-centric view of a businesses problems, rather than a business-centric first view could lead to problems. The IT agility everybody is talking about these days really is a focus on business goal alignment.

--Paul Calento

(note: I work on projects sponsored by EnterpriseCIOForum.com and HP)

pearl
Pearl Zhu 90 Points | Wed, 09/07/2011 - 16:04

Hi, Paul, I agree, just read another interesting article this morning, IT has to be at the same page with CEO, and well aligned with corporate vision & mission, actually the companies' IT capabilitiy (such as IT project's success rate) may decide business's competitive edge. http://www.informationweek.com/news/global-cio/interviews/231600888

pearl
Pearl Zhu 90 Points | Wed, 08/10/2011 - 16:42

Hi, Judy and Jim, thanks for great comments, absolutely, the business & IT allignment is critical at today's fast-changing environment, just read another article today regarding IT/CIO's influence on business, which is the key for IT not only to allign with the business, but also become the influential engine to drive the potential changes. thanks

ocdqblog
Jim Harris 1 Point | Tue, 08/09/2011 - 21:18

Excellent blog post, Pearl.


Great overview of the top ten challenges facing CIOs today.


Elevating the IT Maturity level, and the organization’s related perception of IT, is perhaps the greatest challenge on the list. Even some of the best IT departments I have encountered in my career only excel (and perhaps only strive for) at Level 1 (Functional) or Level 2 (Enabling). As you said, those competencies are far away from satisfying both internal business customers and external end customers.

CIOs need to change not only the way the organization views IT, but also the way that IT views and evaluates itself.

Best Regards,

Jim

Judy Redman
Judy Redman 55 Points | Mon, 08/08/2011 - 02:52

Pearl, good post.  Becoming better at business and IT alignment are the reasons for each of the 10 challenges.  Do you agree?