Many I’s Of The CIO: Information, Innovation, Inspiration, Imagination
Recently, I sat down with several CIOs to discuss what they consider to be some of the most pervasive day-to-day challenges of their role, especially as it relates to driving new digital initiatives and business processes in their organizations. In short, the challenges of a CIO include managing the internal process of getting the support from the relevant people in the organization, ensuring that the right technology and processes are adopted, and controlling for costs while optimizing for the goals of the organization. Managing these challenges well can help in making a CIO successful.
In the following, I discuss challenges faced by CIOs and potential solutions addressed in the roundtable:
New digital technologies are considered a cost center. Some decision-making members of an organization may be reluctant to pursue some initiatives pushed forward by the CIO because of the associated costs. In response, some CIOs attempt to re-define the paradigm that R&D is a cost center by asking first what are the capabilities needed in the organization. CIOs identify what is needed by employees at the organization and then get buy-in from the employees. When it becomes a collective internal effort with a clear understanding of the benefits of the new technology, adoption becomes more palatable from the corporate finance lens because everyone involved in the process understands the potential usefulness of the new technology.
Organizational culture is an obstacle to adopting new technologies. CIOs must drive new technology initiatives while adapting to internal cultural idiosyncrasies. A few solutions to overcoming an obstinate workforce include:
- Find a champion, or a key business unit leader that believes in the vision of change at the organization and who has the credibility to convince other employees to shift to new digital technologies. Don’t underestimate the power of an internal champion who believes in the technology and can act as the organizational representative that facilitates the adoption of new software and processes.
- Institute a “benefit share” with internal business leaders so that costs and rewards are shared in the process of adopting new technologies. If the incentives are economically aligned with the CIO and other members across the organization, adoption may encounter less resistance, partly because participating members can share in the upside.
- Have key business leaders fall in love with the future. One way a CIO can accomplish this is by taking a trip to “shop” for new technologies with key people or decision-makers to inspire new ways of thinking about how technology provides real business solutions.
Relevant technologies are difficult to identify and stay on top of in a fast-changing technology landscape. One way to solve staying up-to-date as an organization is to employ individuals, or “hunters”, whose sole responsibility is identifying new potential technologies that can make the business more effective. These people at the organization can be responsible for interfacing directly with early-stage startups and other organizations to understand what is coming next.
New technologies require new skillsets for all members of the organization, including senior level management. Having human resources with the skillsets required to adopt new technologies is critical. If the organization has a human capital shortfall, then the CIO must take responsibility and drive towards investing in the right training and talent. Moreover, if the CIO has an understanding of internal leadership succession plans, then ensuring that every future leader gets experience in IT can make the process of adopting new technologies easier because future leaders may better understand the implications of technology adoption, thereby making it easier for the CIO to get support for future technology initiatives.
Executing on the day-to-day sometimes makes it difficult to imagine additional revenue streams. As an organization becomes more technologically advanced, it is important to stay aware of other opportunities that may lead to new lines of business, such as leveraging proprietary data via APIs, for example. Monetizing these opportunities can be another way for the organization to expand margins and remain competitive.
Disclosures: The information set forth herein is not intended to constitute investment advice and under no circumstances should any information provided herein be used or considered as an offer to sell or a solicitation of an offer to buy an interest in any investment fund managed by Sapphire Ventures. Information provided reflects Sapphire Ventures’ views as of a particular time. Such views are subject to change at any point and Sapphire Ventures shall not be obligated to provide notice of any change. Sapphire Ventures does not solicit or make its services available to the public and none of the funds are currently open to new investors.