What does a CIO actually do all day?

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In this blog post, I want to elaborate on the article ‘The future of the CIO in a Digital Economy’.  (Weill & Woerner, 2013)

The two research scientists from MIT conducted a study that is based on several years and several methods of research. They looked into how CIO’s spend their time, and not any less important, how their managers actually wanted them to spend their time. From this study, they found four main CIO types.

The first one is the IT services CIO, the focus of this CIO is to provide the firm with all the IT services that the firm needs to operate in a digital economy. The external customers CIO, the second type of CIO,  works with external customers or partners to sell and provide them with IT enabled products and services. The third type is the embedded CIO, this CIO is more focussed on the management of the company and is thinking about the strategy of the company together with other managers. The fourth type is the enterprise process CIO, this CIO manages and oversees key operational processes, including IT processes.

It depends on the company’s goals what is a more effective type of CIO. For example, when you focus on return on capital you should be an embedded CIO. However, focussing on innovation requires an external customer CIO, and profitability measures an enterprise process CIO. Firms with a mixed performance focus likely have IT services CIO’s.

The other managers want their CIO’s to be an IT service focussed CIO at first and then become an embedded CIO, working with non-IT colleagues as well. Once this is the case, they want the CIO to focus more on external customers.

The CIO’s themselves consider themselves mostly as an IT service CIO that wants to develop into one of the other types. In order to do so, CIO’s can do three things to save time that they can spend on other activities; mentoring, governance and partnering. The goal is to allocate time wisely, develop leadership strategies to save time and look at the future and anticipate on what type of CIO is needed.

I can conclude that CIO’s are much more than only managers of IT services. The want to do a lot more and other managers require them to add a broader business value to be able to keep up with the digital economy.

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The difference between a CIO, a CTO and a CDO

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In light of the importance of leadership capabilities for the digital transformation of an organization, chances are high that you stumble upon abbreviations like CTO, CIO or CDO. I didn’t really know what the exact difference is, so I started to do conduct a little research and I would like to share the results with you.

The term CIO, Chief Information Officer, was first defined by Synnott and Gruber in 1981 as a senior executive of the organization responsible for information policy, management, control, and standards. They further added that the five primary functions of a CIO include participation in corporate strategic planning, responsibility for information systems planning, leading the development of corporate or institutional information policy, management of the organization’s information resources, and development of new information systems capabilities. I believe this definition is still quite accurate to describe the role of a CIO today. Just today the focus of a CIO is much more on actually increasing profits with the use of IT. From the definition, you can also tell that a CIO is rather internally faced and is mostly responsible for processes that happen within the organization.

The role of a CTO, a Chief Technology Officer, shares some common attributes with the role of a CIO. Both positions need to have a strong business understanding in order to bring added value to the organization and to align their respective responsibilities with organizational goals. They also need to have a technical background, so that they can understand and evaluate the underlying technologies in a business. In comparison to a CIO however, the CTO has a more customer facing role and is mostly responsible for enhancing the company’s product offerings. Connected to that, another difference of both roles is that the CTO is usually responsible for the development of new technologies in a company, whereas the CIO has its focus more on organizational problems and tries to solve these with existing IT solution.

Next to both roles, which have been around for a while now, the role of a CDO, a chief digital officer, has emerged recently. His major responsibility lies in digitally transforming traditional businesses to digital ones. In order to do so, the CDO needs to determine the parts of the business where influencers are able to support the change and to empower these influencers. That’s why, it is especially important that the person that fills in this role is not only a digital expert but also familiar with all parts of the organization.

I hope this short summary helped you to get a better understanding of these particular roles in an organization. Please keep in mind that these are not fixed roles and every company can interpret a role differently and the roles have been changing throughout the past. If you want to read further on this topic, I recommend you to check out my sources. Also, if you are curious how people actually became CTOs, CIOs or CDOs and what jobs they did prior to that, I recommend you to just use the LinkedIn advanced search and search for these positions in the country of your choice. This works fine even if you are not a Premium user.

I wonder what your opinion is on these roles. Does every company need to have all three roles on their board? Or do you think the CDO is just an evolution from the CIO and will make this role redundant?

 

Sources:

Penrod, James I. “The Chief Information Officer in Higher Education. Professional Paper Series,# 4.” (1990).

Synnott, William R., and William H. Gruber. Information resource management: opportunities and strategies for the 1980s. John Wiley & Sons, Inc., 1981.

http://www.computerwoche.de/a/der-cio-totgesagt-und-alle-haende-voll-zu-tun,2528153

http://www.forbes.com/sites/peterhigh/2014/03/03/why-your-company-should-consider-adding-a-cio-to-the-board/#4791a363e2f6

http://www.uniforum.org/publications/ufm/nov96/cio.html

http://www.huffingtonpost.com/don-tapscott/do-companies-still-need-a-cio_b_6214482.html

https://en.wikipedia.org/wiki/Chief_digital_officer#cite_note-8

https://en.wikipedia.org/wiki/Chief_technology_officer

https://en.wikipedia.org/wiki/Chief_information_officer

http://www.techrepublic.com/blog/tech-sanity-check/sanity-check-whats-the-difference-between-cio-and-cto/

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IKEA eat your heart out, Lowe’s is transforming the way we redesign our homes

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Have you ever remodeled a room, or even only tried to imagine how a new colour on your wall would look like? Those of you who did know that this is not an easy process and that it mostly is accompanied with a lot of arguing, deliberation and high costs when it turned out not to be as you imagined. Lowe’s, a fortune 500 home store chain has the answer to all your remodel problems and will transform the whole way we will remodel our houses in the future. IKEA eat your heart out.

Lowe’s teamed up with Pinterest and Microsoft to improve the process of remodelling and here is how they did. The process of remodeling does not start in a home store but way up front on your pinterest walls. By giving Lowe’s access to your pinterest wall in the in store app, the cortana intelligence system of Microsoft can identify for example which kitchen of Lowe’s inventory matches best your pinned pictures on pinterest. The system provides you recommendations based on this match. If you would like to know how this kitchen look like in real life size, you can go to a Lowe’s store where the hololens of Microsoft provides you this experience. Moreover, you can change almost all features of the kitchen and see how they look like combined. When you are satisfied you can order all elements of your own designed perfect kitchen. The Hololens enables Lowe’s to capture the opinion on specific features of their customers by combining the eye-tracker with the Cortana voice recognition. This technology enables Lowe’s to continuously improving their services and products.

It is clear that Lowe’s has some strong new digital capabilities. First, the new technology improves the customer experience by helping tacit ideas in customers minds make explicit and by recommending products based on their true preferences. Second, the new technology shifts the core operations of Lowe’s from inventory management to recommendation and designing services. Less inventory and show models are needed since the products now can be visualized through the Hololens and the products can be made to order. The focus of employees now lies on recommending matching products and designing new features that best matches customer preferences. Third, the new technology changes the whole business model in a way that it becomes a pull rather than a push market. The Hololens and the partnership with Pinterest help customers determine what they want and give Lowe’s insight in what the customers want rather than they push a specific kitchen into the market.

Lowe’s has the potential to become a Digital Master but only time can teach us how Lowe’s will combine these strong digital capabilities with their leadership capabilities to make it an industry changing success. The pilot version was a hit and by the end of 2016 they plan to launch the experience in three more stores in America. When they can successfully roll out the concept in al their stores globally, Lowe’s will be a true Digital Master. IKEA eat your heart out.

What is your opinion on the way Lowe’s remodels the remodeling business? Do you see any complications in this approach? Do you think other firms can learn from Lowe’s or do you think Lowe’s needs to learn from other firms?

Sources:
http://www.lowesinnovationlabs.com/hololens

Westerman, G., Bonnet, D., & McAffee, A. 2014. Leading Digital: Turning Technology into Business Transformation, Harvard Business Review Press, 2014.

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