EY-CIOs-Born-to-be-digital
EY-CIOs-Born-to-be-digital EY-CIOs-Born-to-be-digital
“Now we’re in a world where things areinstant — whether it’s data consumption,acquisition or analytics, people expectanswers immediately. To deal with this,IT and marketing must get closer.”Michael Golz, CIO Americas, SAP3Digital-readyCIOs focus closely ondriving growth — and therelationships they need to supportthis.One of the standout points about the digital-ready CIO is that theyare looking toward the front of the business, seeing how technologycan help to drive growth by changing the way the company marketsand sells its wares. The CIO of a major Chinese insurance companyexplains how her firm is working closely with the front office to givethem the mobile tools they need to boost sales. Building on this,she’s working to improve the analysis and mining of data captured,to gain greater customer insights and design more effective salescampaigns. “We’ve seen a clear increase in sales efficiency already,”she says. As a result, the executive management team has nowtasked her with applying data analytics to generate new customerinsights — and then to work with the business to apply thoseinsights to sales and marketing, and even product design. “All ourtechnology will be leaning toward increasing sales productivity, andgiving our agents more tools to use when they are in the field,”she says.Clearly this implies a much closer emphasis on fosteringrelationships with the front of the business, rather than focusingpredominantly on the back office. “We need to understand thecompany’s business operations deeply and both its front- andback-end processes,” says the CIO of a major Chinesetelecommunications operator. Most obviously, while CIOs often failto realize the value of their company’s external clients to theircareers, digital-ready CIOs are far more engaged here. Nearly twiceas many (59% versus 33% of IT-intensive industry CIOs) cite endclients as being strongly important to their career. Many others alsorealize the importance of roles such as the CMO or head of sales totheir career.But this is not just about recognition. Digital CIOs also act on this:59% say they have a very strong relationship with their CMO,compared with just 37% of IT-intensive industry CIOs. Modern CIOsneed to be true partners with marketing and sales, forming analliance whereby the CSO and CMO deliver insights on customerexpectations and interests, and the CIO can deliver on thesethrough new systems and processes that make the most of theseinsights.Herman de Prins, the CIO at Belgian pharmaceuticals companyUCB, explains how he spends a lot of time helping to facilitatemultichannel marketing — and making sure the front officeunderstands what’s possible. “They also need to think differently interms of integrating digital activities into their analog activities. Youneed to get them to look at their business in a completely new way,not just automating a particular process,” he says.The same need for stronger relationships applies outside thebusiness too. CIOs must get closer to the firm’s end customers,their needs and preferences. Half (52%) of digital-ready CIOs placea strong emphasis here, well ahead of their IT-intensive industrypeers (37%). “Whenever we’ve asked CIOs, we find that those whoregularly meet with customers are still very much the exception,”notes InformationWeek’s Preston.24 | Born to be digital
Chart 8Business relationship of CIOs with internal and externalstakeholdersExternalDirect reports and subordinatesInternalChief financial officer (CFO)Department headsChief executive officer (CEO)Chief operating officer (COO)Chief marketing officer (CMO)Chief sales officer (CSO)ClientsRegulatorsAnalystsMedia21%37%44%39%37%44%31%43%33%33%Digital-ready CIO63%75%59%58%63%54%59%52%75%73%94%90%IT-intensive industry CIO(Percentage of respondents who have chosen 8, 9 or 10 on a scale from 1 = needs substantial improvementto 10 = absolutely excellent)“Storytelling is a key skill.”Diego Calegari, Spanish South American CIOExecutive, IBM4Digital-readyCIOs ensure theirvision is understood.The next trait that stands out is the ability to craft a compellingstory about how technology can transform the business. This isvital: digital changes the way many businesses work, opening upwholly new possibilities, but people have to buy into this vision, andunderstand how it might benefit them — in short, CIOs need to bemaster storytellers. Not with the aim of selling a fairytale, butrather in creating an exciting narrative that the rest of the businesscan buy into.Communication is a vital part of any CIO’s role, and one wheremany acknowledge the need for improvement. But the ability tocraft a tale of how the business might look and work after a digitaltransformation further intensifies this need. “Storytelling is a keyskill,” says Diego Calegari, Spanish South American CIO Executiveat IBM, who explains that true storytelling requires a deep grasp ofthe core of the business and how it works, in order to explain how itcan change in future.SAP Americas CIO Michael Golz cites examples of CIOs he meets inhis peer-to-peer customer conversations, like the aerospace CIOwho explains convincingly the impact of harnessing in-flight sensordata to transform their business model, or the medical device CIOwho articulates the impact of information technology on theirproducts to improve the well being of patients, while creating deepcustomer relationships. “These CIOs clearly know their industrybusiness processes, the value of collecting data from theirproducts, the business around monetizing that data, and creatingvalue-added services. They know how to explain these newbusiness models, which may be more profitable than actuallybuilding the physical products,” says Golz. “So it’s a true businessconversation. It’s not about upgrading system XYZ to improveefficiency by 0.5%.”In particular, a CIO should be able to explain the strategy of thecompany, the strength of its products, and its go-to-marketstrategy, using the relevant business terms and KPIs. Digital-readyCIOs more often recognize this need: 9 out of 10 citecommunication and influencing skills as strongly important to theirroles. “Now that technology-driven innovation has become criticalto organizational success, there is more pressure on the CIO tocommunicate that importance,” says Nedbank’s CIO FredSwanepoel. “It’s about your ability to go head-to-head withbusiness executives in discussions about IT’s role in changing thecore of the business. It’s here that I often see the traditional techiesstruggle.”Born to be digital |25
- Page 1 and 2: Born to be digitalHow leading CIOs
- Page 3: In this reportForeword2Executive su
- Page 6 and 7: IT-intensive industries51% 53% 67%
- Page 14 and 15: Typically more engaged on strategic
- Page 16 and 17: Case studyIBM’s global-localIT tr
- Page 18 and 19: Chart 5How IT-intensive industry CI
- Page 20 and 21: Section 3A mindset forchange:six tr
- Page 22 and 23: Six distinctivetraits ofdigital-rea
- Page 24 and 25: “I spend at least 30% of my time
- Page 28 and 29: “I spend little time on back offi
- Page 31 and 32: Could emergingmarkets leapfrogon di
- Page 34 and 35: Career lessons from digital-ready C
- Page 36 and 37: Chart 14Career paths of leading CIO
- Page 38 and 39: ConclusionPreparing for adigital bu
- Page 40 and 41: DemographicsBoard membership47%NoJo
- Page 42 and 43: Endnotes1. “Embracing digital tec
- Page 44: EY | Assurance | Tax | Transactions
Chart 8Business relationship of <strong>CIOs</strong> with internal and externalstakeholdersExternalDirect reports and subordinatesInternalChief financial officer (CFO)Department headsChief executive officer (CEO)Chief operating officer (COO)Chief marketing officer (CMO)Chief sales officer (CSO)ClientsRegula<strong>to</strong>rsAnalystsMedia21%37%44%39%37%44%31%43%33%33%Digital-ready CIO63%75%59%58%63%54%59%52%75%73%94%90%IT-intensive industry CIO(Percentage of respondents who have chosen 8, 9 or 10 on a scale from 1 = needs substantial improvement<strong>to</strong> 10 = absolutely excellent)“S<strong>to</strong>rytelling is a key skill.”Diego Calegari, Spanish South American CIOExecutive, IBM4Digital-ready<strong>CIOs</strong> ensure theirvision is unders<strong>to</strong>od.The next trait that stands out is the ability <strong>to</strong> craft a compellings<strong>to</strong>ry about how technology can transform the business. This isvital: <strong>digital</strong> changes the way many businesses work, opening upwholly new possibilities, but people have <strong>to</strong> buy in<strong>to</strong> this vision, andunderstand how it might <strong>be</strong>nefit them — in short, <strong>CIOs</strong> need <strong>to</strong> <strong>be</strong>master s<strong>to</strong>rytellers. Not with the aim of selling a fairytale, butrather in creating an exciting narrative that the rest of the businesscan buy in<strong>to</strong>.Communication is a vital part of any CIO’s role, and one wheremany acknowledge the need for improvement. But the ability <strong>to</strong>craft a tale of how the business might look and work after a <strong>digital</strong>transformation further intensifies this need. “S<strong>to</strong>rytelling is a keyskill,” says Diego Calegari, Spanish South American CIO Executiveat IBM, who explains that true s<strong>to</strong>rytelling requires a deep grasp ofthe core of the business and how it works, in order <strong>to</strong> explain how itcan change in future.SAP Americas CIO Michael Golz cites examples of <strong>CIOs</strong> he meets inhis peer-<strong>to</strong>-peer cus<strong>to</strong>mer conversations, like the aerospace CIOwho explains convincingly the impact of harnessing in-flight sensordata <strong>to</strong> transform their business model, or the medical device CIOwho articulates the impact of information technology on theirproducts <strong>to</strong> improve the well <strong>be</strong>ing of patients, while creating deepcus<strong>to</strong>mer relationships. “These <strong>CIOs</strong> clearly know their industrybusiness processes, the value of collecting data from theirproducts, the business around monetizing that data, and creatingvalue-added services. They know how <strong>to</strong> explain these newbusiness models, which may <strong>be</strong> more profitable than actuallybuilding the physical products,” says Golz. “So it’s a true businessconversation. It’s not about upgrading system XYZ <strong>to</strong> improveefficiency by 0.5%.”In particular, a CIO should <strong>be</strong> able <strong>to</strong> explain the strategy of thecompany, the strength of its products, and its go-<strong>to</strong>-marketstrategy, using the relevant business terms and KPIs. Digital-ready<strong>CIOs</strong> more often recognize this need: 9 out of 10 citecommunication and influencing skills as strongly important <strong>to</strong> theirroles. “Now that technology-driven innovation has <strong>be</strong>come critical<strong>to</strong> organizational success, there is more pressure on the CIO <strong>to</strong>communicate that importance,” says Nedbank’s CIO FredSwanepoel. “It’s about your ability <strong>to</strong> go head-<strong>to</strong>-head withbusiness executives in discussions about IT’s role in changing thecore of the business. It’s here that I often see the traditional techiesstruggle.”<strong>Born</strong> <strong>to</strong> <strong>be</strong> <strong>digital</strong> |25
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