Technology, from digitalization in every vertical to artificial intelligence, promises to reshape the competitive landscape and disrupt business models and is at the heart of trends that have reshaped the competitive landscape and disrupted business models. Hence in today’s world, companies need to be technology-driven. Now, every company’s CIO is like the captain of the ship that drives technology. In recent years, executives have emphasized the need for CIOs to go beyond just managing IT to leveraging technology to create value for the organization.
The role of a CIO has continuously evolved over the years. The first chief technology officers were appointed in the 1980s. Over the next few decades, the executive position became commonplace as technology boomed. Since then, CIOs have gained importance as data and technological processes have become increasingly important in almost all organizations. Modern CIOs must be able to manage and use data to drive growth, so they must make the right technological choices to facilitate that.
Further, the role of CIOs has evolved tremendously since the COVID-19 crisis. An executive survey conducted by McKinsey to understand the effects of COVID-19 on companies found that their companies are digitizing their customer relationship management, supply chain, and internal operations three to four years earlier than they would otherwise be. The share of digitally enabled products in their portfolios was accelerated by an astounding seven years. There is no turning back after COVID-19. As a result of the crisis, the CIO role has evolved from a technology leader to a cross-functional business leader. Organizations’ investments and expenditures have increased rapidly with the proliferation of IoT, AI/ML, AR/VR, Digital Twin, Agile, and DevOps. Today, CIOs play a critical role with and as business decision-makers in developing an organization’s roadmap that identifies and executes initiatives that will have a significant impact while staying abreast of the latest trends and utilizing technologies that can maintain agility and flexibility no matter what.
David Reilly, who has more than 25 years of experience working with some of the world’s largest financial institutions, including Bank of America, says what applies to the CIO also applies to the CTO. With more than 25 years of experience driving digital adoption and transformation for some of the world’s most reputable financial institutions, he has an extensive background in driving organization-wide changes across the globe.
To ensure a company’s success, he mentions five components every CIO should consider when making decisions and strive to balance every decision across all five. Here they are:
- Cost of the product: David Reilly believes your products need to be priced competitively within the markets where you operate. If they are too expensive or you cannot control the costs, the product won’t survive very long in the market. Success in any industry depends on intelligent pricing strategies. Prices impact design decisions and should be reviewed over the long term.
- Quality and reliability of service: He further mentioned that the second aspect is the quality of your product and reliability. Regardless of price, if the product does not deliver quality and reliability, it will soon hurt your business. As a result, it is imperative to balance these two aspects, that is, between the product’s price and quality/reliability.
- The capability of the product: If the price is appropriate and the service level is where it should be, the capability of the products must allow a business to stand out and win in the market. He additionally states that the enterprise won’t succeed if the product is not capable enough to compete with the market, no matter how cheap or reliable they are. The symbiotic relationship between your product capabilities and market requirements is what makes your product stand out to your target audience.
- Risk management: A company needs to manage the risks even if the price is right, the product is reliable, and the capability is up to date. It doesn’t matter how competitive, how reliable, or how cheap your product is if it is secure or if it cannot ensure risks are understood and mitigated from an audit or regulatory standpoint. CIOs of high-performing companies commonly see cybersecurity and risk mitigation as an enabler of growth because it fosters customer trust and displays a commitment to protecting customer information. Additionally, it allows CIOs to provide their organizations with reliable technology, allowing them to become valuable business partners.
- Talent: Finally, Mr. Reilly emphasizes the importance of maintaining and developing talent because if you can’t keep the best employees and if you can’t attract the best people, none of the above mentioned aspects will succeed on a sustainable basis. For CIOs at high-performing companies, talent is a top priority and strength. A high-performance culture is built by articulating a vision, empowering employees, setting clear expectations, and grooming, motivating, and engaging talent.
A CIO’s ability to transform IT is enabled by these components and, in particular, balancing decisions across all five all of the time.