CTOs and CIOs: How to reduce the tech butterfly effect
In August 2022, we performed a series of qualitative interviews with 30 leaders from selected parts of the internal value chain to understand the challenges that effect the customer experience (CX).
The value chain is the collection of an organisation’s strategic and supportive activities that generate customer value (margin). A value chain study allows us to assess where true value is created and where improvements should be made. A company can gain competitive advantage by performing these activities more effectively than its competitors.
For the CTO/CIO interviews, we spoke to those from small to large sized companies of 5 to 1000+ employees. Industries included Technology, Energy, Financial Services, Recruitment, Education, Biotechnology, Transportation, Healthcare, Legal, Professional Services and FMCG
What does a CTO/CIO do?
The Technology leader (CTO/CIO/Head of IT) oversees IT operations, set data policies, and meet business technology governance including risk and cybersecurity. They seek out new technological options and ensure that they are integrated into the existing technology stack, oversee the maintenance of these systems and services on an ongoing basis, and make sure that their internal IT operation is well-resourced and well-staffed. They will have a very strong technical background.
How has the Technical leaders role changed?
Gone are the days, when IT were the team that fixed technical issues and set up your laptop … Nowadays the whole organisation is wired and connected, and EVERYTHING is reliant on digital processes and systems. This role holds, in its hand, the very essence of long-term success for an organisation through the development and dissemination of technology for external customers, vendors, and other clients to help improve and increase business outcomes. Process and Systems are forefront of customer’s minds, and a system must be easy to use, quick to process and this is the same for the internal teams who need to work ‘at pace’. Digital Transformation has now become a key organisational objective with everything connected via digital systems and it all rests on the shoulders of senior digital leaders to make the right changes at the right time. Nowadays this role needs to be both technical and strategic.
Striking the balance between transformation and good governance
A few leaders stated that “People hate IT” and resentment builds when stakeholders feel IT is limiting their CRM and other systems by creating “silly software rules”. IT must deliver digital systems in a cost-effective way to glue the system together so that it works efficiently and effectively. They attempt to join up business process in a non-controlled way, yet they operate under the butterfly effect where one small change upstream can have catastrophic issues downstream. Digital solutions can create an efficient future business and one that could be a source of differentiation, but many found that the term “Digital Transformation” is used out of context and needs a clear definition to what that truly means to that specific organisation.
Digital requirements driven by cultural and lack of stakeholder engagement, process and strategy
Organisational culture plays a big part in the IT approach and IT leaders must continually tread carefully across a complex group of different personality types with different needs. Culture also drives the behaviours around data that can reduce choices, increase ambiguity, and be affected by new business processes. The lack of digital process in other departments increases challenges for IT particularly the lack of data management by departments. “Inputting poor or incomplete data reduces the data quality” and often requires optimisation or enrichment which could have been avoided at the input level. IT have a continual flow of stakeholders with different requirements and piecemeal requests with “no link to the bigger ‘WHY’ this change should happen”. A greater stakeholder alignment and engagement would allow IT to create a data strategy that supports the organisational strategy and aligns internal departments.
Legacy system integrations create elongated projects with limited resources
Companies that scale up through acquisitions require IT to continually integrate new systems/products into the organisation’s system but can only be taken so far – many agreed that starting new would be easier, but they lack the budget. Updating legacy systems often resort to a manual entry approach due to system limitations and the challenge is how to make this an automated update process across multiple platforms… without breaking anything! Other departments are impatient, and IT often need to gather the right staff capability to enable work which is compounded with staff changes and a processes/skill is lost with a leaver. IT projects could be more effective with internal supporters and alignment that avoid a project becoming elongated.
Differences in business and technical language
IT leaders recognised there is a gap between digital and business teams and there is a need to educate and align stakeholders and teams about objectives. They both speak English, but they speak a different business language with different objectives. Referring back to key stakeholder alignment, there is a need for a group or forum to collaborate for digital requirements to form a common language and objectives. Digital people know tech, but many teams have little understanding of the commercial aspect and they need an interface between teams to understand, articulate and align visions.
Summary
Today’s technology leaders bear a significant responsibility to maintain good digital operations across the entire value chain. They need to strike a balance between current system operations and an efficient future business that could be a source of differentiation, but it will be important to define their version of “Digital Transformation”. Stakeholderalignment and engagement would allow IT to create a data strategy that supports the organisational strategy, aligns internal departments, and alleviate some of the ad-hoc system change requests. Lastly, leaders would benefit by educating their tech teams on the business impact of digital changes as well as creating and sharing a long-term strategic data vision.
Alternate Opportunities
But Tech leaders recognised they don’t have the strategic capability and capacity to address this work which would be easier to overcome with an external research expert that would ….
- Formulate a common business understanding of the digital CX requirements by reviewing customer paint points and digital touchpoints and system capabilities to deliver an excellent CX.
- Review what competitors and the market are doing digitally and identify digital mandatories and areas of value to increase competitiveness.
- Identifying what data is valuable and how the IT tech stack can support ABM in a pragmatic way that is cost efficient, user effective and delivers a new process to increase long term revenue.
- Assess and align any project requirements, short and long term, prior to kick off to ensure that any digital suggestions are feasible within the current and future architecture.
- Create training and processes that facilitate good data quality and practices that deliver long term quality data and systems that simplify IT’s data management workload.
If you need some help overcoming some of these challenges, drop us a line or read more about our services here.
