Posts

The 4 Zones Model: A Playbook for the Performance Zone

/0 Comments/in , /by

The CIO is not a “Device Santa Claus”

santa image

My good friend and technology futurist, Thornton May, clearly defined the CIO’s role when he said “…the role of the CIO is not to be a ‘Device Santa Claus’ but, rather, to craft an environment which empowers executives to create competitive advantage vis-à-vis the innovative and informed use of information technology.”

A recent McKinsey & Company survey of business and IT leaders validated that when CIOs play an active role in shaping their company’s business strategy both IT’s and the company’s overall performance greatly improve. However, when business executives were asked how well IT supported key business activities like entering new markets and driving new revenues, only 35% agreed IT played that role in their company down from 57% in the same survey two years ago.

If actively engaging the CIO in helping to shape a company’s business strategy works so well, then why are so many companies not doing it? My answer is that they don’t have a “good decision-making governance process” that aligns future IT investment priorities with critical business outcomes.

The Performance Zone: Demonstrating the Business Value of IT

The 4 Zone Model I’ve developed ( link to earlier blog http://eepurl.com/blFb3T ) is designed to enable CIOs and their senior leadership teams to maximize the business value of IT across their organizations. IT’s charter for the Performance Zone in particular is to provide new user-centric tools, services and solutions e.g., social, mobile, cloud and data analytics that improve the competitive performance of each of the company’s lines of business.

To effectively demonstrate IT’s ability to directly contribute to generating new revenues and profits, CIOs and their leadership teams must actively engage their internal business partners and users. To activate this new process, I propose that they utilize the Collaborative IT Governance Model below.

The Collaborative IT Governance Model

infographic

From my early work in this area, I have seen first-hand how effective this model is in breaking down hierarchical, silo-based decision-making processes and converting them into horizontal cross-enterprise decision-making processes. It enables all the key stakeholders to be aligned with and committed to a common course of action to deliver the desired business outcomes. It has also dramatically increased the speed to market and throughput of major IT developmental projects.

It’s An Outside-in Approach Not An Inside-out Approach

To effectively deploy the collaborative IT model, you need to start with a common understanding of what you want the ultimate user experience to deliver to customers, employees, supply chain partners and other key constituents.

Historically IT has started with the technology it has and added to it. This inside-out approach is fine if your goal is to modernize your Systems of Record and optimize the cost of maintaining them. However, if your goal is to provide “friction-free” customer engagements then you must take a very different approach.

This outside-in approach begins by getting all the key stakeholders to address three fundamental questions:

  1. What are the key moments of customer engagement that define the success of our business or company?
  2. Who or what system represents our company at this moment of engagement?
  3. How could we strategically intervene with a new system of engagement in order to make that moment of engagement more compelling and enduring?

Some companies I’ve worked with have used a “customer touch point” mapping exercise to identify all the different touch points and eliminated those that they felt added no value to the customer. They then looked for opportunities to enhance the value of critical touch points and finally they identified gaps where they could add new touch points.

In all cases, it has been gratifying to see that when these models and tools have been utilized they have successfully demonstrated the business value of IT in multiple business growth venues.

In my next blog, I will take a deeper dive into the Incubation Zone and talk about how you can deploy our Three Innovation Playbooks model to significantly increase the ROI on your portfolio of IT investments.

As always, I am interested in your comments, feedback and perspectives on the ideas put forth in this blog. Please e-mail them to me at pdmoore@woellc.com.

A New Playbook for Enterprise IT: A Get Out of Jail Free Card

/0 Comments/in , /by

You cannot successfully transform your company into a true digital enterprise if you keep your IT Group under house arrest.

Image showing hands on bars in jail

The pace and magnitude of digital transformation disruption mandates that your company must figure out how to deploy technology-enabled innovation as a critical driver of new revenues and profits. This doesn’t mean you need to be the disruptive innovator in your industry, but it does mean that you need to figure out how to neutralize the disruptive innovation’s impact on your business/operating model quickly.

If you just look at your IT Group as a source of cost optimization whose primary role is to keep the lights on, then you miss the opportunity to leverage technology as a change-the-business tool in the new world of digitally mediated customer engagements. Simply put, you have to let IT play offense not just defense.

McKinsey & Company Survey Results:

That said, I found the dichotomy presented by the results of McKinsey & Company’s latest survey of business and IT executives both validating and troubling. Their findings strongly validated that when CIOs play an active role in shaping a company’s business strategy IT’s overall performance significantly improves. However, when business executives were asked how well IT supported key business activities such as entering new markets and driving new revenues, only 35% agreed IT played that role in their company down from 57% in the same survey two years ago.

If actively engaging the CIO in helping to shape a company’s business strategy works, then why are so many companies not doing it? My answer is that they haven’t found a way to free IT from the legacy mindset of its past. To do that successfully, I want to propose a prototype for a new playbook for enterprise IT which is highlighted below:

faq
Over the past 3 years, I’ve had the opportunity to talk to well over 200 CIOs and senior IT leaders about the different operating and cultural challenges they face in gaining a seat at the business strategy table. Their input and ideas have contributed to helping me develop a Collaborative IT Governance model, a series of IT thought leadership forums and communication programs, a process to identify and redeploy trapped IT value, as well as other tools to help them evolve IT from a cost center support function to a strategic business partner role.

These multiple conversations along with some early use case studies have gone into the design of the prototype playbook model above. It is by no means exhaustive or complete but rather suggestive of the variety of capabilities, services and deliverables that represent the new business value IT can deliver across any enterprise. It is designed to enable IT to carry out its core “run the business” functions while still being freed up to deploy “change the business” functions.

Each component of this new playbook will contribute to allowing your company’s enterprise IT function to evolve from a cost center/support function to a service provider to a business enabler to eventually a full partner in shaping and guiding your business growth strategy.

What I have learned over the past 3 years is that to successfully create and deploy this playbook is a leadership challenge not a management challenge. This is not about just doing what IT has always done better, faster and most cost effectively. This is about changing the role of IT from follower to leader. This is about changing outcomes by changing legacy attitudes, behaviors and actions. Simply put, this about choosing results over rhetoric.

These discussions and dialogues will continue in the months and years ahead and I invite you to participate in them and contribute your ideas and potential solutions. These challenges are bigger than any one company or any one CIO can solve. But I strongly believe that as a community of open minded, forward thinking IT professionals we can collectively find a way to get out of jail.

get out of jail

As always, I am interested in your comments, feedback and perspective on the ideas put forth in this blog. Please e-mail them to me at pdmoore@woellc.com.