Succeeding in today’s marketplace is all about speed, agility, and innovation. Every C-suite executive, as well as board member, is trying to figure out how to help his or her company be more competitive in a marketplace defined by volatility, uncertainty, complexity, and ambiguity (VUCA).
The common denominator for companies that succeed in this environment is how they leverage information and technology to change the dynamics of the business enterprise and achieve competitive advantage. Strategic CIOs are leading the charge as they work collaboratively with their business peers to develop new and enhanced products and services that create customer value, increase margins, and enhance shareholder wealth.
Strategic CIOs leverage information and technology in innovative ways. They develop new products marketed to external customers, generating revenue for their companies; they strategically use information and technology to create new enterprise business models; and they leverage their business, technical, and entrepreneurial skills by leading new business units. Here are three examples.
Strategic CIOs like CAI’s Steve Heilenman recognize market opportunities. Heilenman was leading an Automated Project Office (APO) product review and observed that testing was taking too long. It was inefficient and costly. He challenged the testing team to reduce that time by at least 50 percent, resulting in a new automated testing process that reduced the standard 800 hours of testing over six weeks to 70 hours over just a two-week period, a 90 percent reduction. Heilenman realized that the automated testing would be valuable for other companies and developed a program to market the tool, called TestInSeconds. It is now sold to IT organizations around the globe.
“TestInSeconds is now a revenue generator for CAI, and we expect this product to generate millions of dollars in revenue over the next few years,” Heilenman says.
Strategic CIOs who run IT as a business are recognized for their business skills and leadership ability. This is what happened at Verisk Analytics, a $1.5 billion provider of risk information serving professionals in the insurance, healthcare, mortgage, government, and risk management sectors.
Perry Rotella, group executive, supply chain risk, and senior vice president and CIO, was selected to lead a new business unit based upon his risk experience, insurance industry knowledge, data analytics expertise, and leadership and business skills. When asked why the board chose him to lead the new business unit, Rotella said, “I think I’ve demonstrated that I run IT as a business, and through my leadership and business skills, the board and CEO had confidence in having me take on a business P&L responsibility.”
Strategic CIOs also leverage their skills to create new business models. Western Governors University (WGU) transformed its standardized student education model into one that provides a personalized education experience for each student.
In 2013, when Niel Nickolaisen was CIO at WGU, he realized that students should be treated as individuals, not as a group. He led a cross-functional team to change that model. “The goal was to create a personalized experience for every student and help him or her improve their learning,” Nickolaisen says. “We accomplish this by proactively identifying students who exhibited learning difficulties using data analytics to track learning, test scores, and professor assessments and create a personalized learning program for each of these students. This helps the students improve their learning, achieve their educational goals, and improve overall graduation rates. It’s a win-win-win for WGU.”
How do you become a strategic CIO that changes the dynamics of the business?
- Develop a trust-based value relationship with C-suite executives and business unit leaders by delivering services exceptionally well, and up-skill IT personnel with business knowledge.
- Gain a deep understanding about the business, competitive market, and customer value.
- Understand the key business processes, enabling technologies, and customer value across the entire chain.
- Work with C-suite executives and business teams to co-develop solutions that achieve significant business outcomes.
- Investigate opportunities to leverage information and technology strategically, to bring value to the business by transforming the enterprise business model that generates revenue, reduces cost, and utilizes business, leadership, and technical skills to lead business units.
Follow these five steps if you’re ready to leverage information and technology to achieve competitive advantage, and reap the rewards as your customers receive new value, your company improves margins, and your shareholders improve their wealth.
This article was originally published at CIO.com.