CIOs are facing a world that is constantly changing, and to succeed in this environment, IT leaders must find ways to navigate this uncertainty by winning in the turns, according to Gartner.
Three forces are the “turns” – geopolitics, economics and the emergence of digital giants – and they are creating uncertainty and pressure for CIOs. These forces are a shift from the normal course of momentum.
To successfully navigate through these turns and excel in a digital society, Gartner analysts said organizations must find their TechQuilibrium – a technology equilibrium point that defines how digital an enterprise needs to be to compete or lead in a digital society.
Valentin Sribar, senior research vice president at Gartner, explained today to an audience of more than 9,000 CIOs and IT executives at Gartner IT Symposium/Xpo that a turn changes the dynamics of the status quo and forces a reaction. These turns often come in combinations, thereby increasing the need to react on different business vectors, and they require a high-performing executive team.
“TechQuilibrium can help create balance between the complex disruptions and many extremes that organizations are facing today,” said Sribar. “CIOs should partner with their executive teams to design a value proposition that drives the right mix of traditional and digital business. When you reach this balance point, you have reached your TechQuilibrium. Individual enterprises and whole industries will have different points of TechQuilibrium. Not every industry needs to be digital in the same way or to the same extent.”
Gartner analysts said the ultimate digital business strategy is about how quickly and how far organizations can digitalize their internal operations and their external value proposition. The 2020 Gartner CIO Agenda survey showed that, on average 20% of organization’s products, services and revenue value proposition are digital. And 39% of their workplace, processes and supply chains have been made more effective with digital technology. However top performing CIOs said over half their operations are digitalized and a third of their value propositions are digital.
“Currently most organizations need to accelerate their digital initiatives to reach their TechQuilibrium. Because the further you are from your industry’s point of TechQuilibrium, the more likely you will be disrupted,” said Sribar.
CIOs should focus on four areas to help reach Techquilibrium in their organizations:
Good decisions are essential to the success of every part of every organization and to society. As enterprises incorporate more technology, and more decisions are automated in a digital society, it can be difficult for human leadership to keep up.
“Organizations must find the TechQuilibrium between humans making decisions and artificial intelligence (AI) systems making decisions,” said Mr. Sribar. “Your decision TechQuilibrium will likely be a mix of both, focused on collaboration between people and machines. Gartner predicts that by 2022, 40% of employees will consult an AI agent for decision support. Most environments, particularly complex, data rich ones, will require a partnership between humans and machines, with machines doing the heavy data processing work and people interpreting and reinforcing decisions.”
According to the Gartner 2020 Board of Director survey, two-thirds of directors see digital and technology disruption as their number one business challenge, more important than talent acquisition, regulation and growth. Additionally, over half of directors said that digital initiatives are their top priority for the next two years. This is an opportunity for CIOs and IT executives to step up to help lead their organizations to TechQuilibrium.
“However, a Gartner leadership self-assessment of over 15,000 CIOs and IT executives showed that the majority of CIOs view themselves as more likely to be reactive or defensive, than assertive or on the offensive,” said Tina Nunno, distinguished research vice president at Gartner. “To reach the TechQuilibrium to win in the turns, CIOs must embrace going on the offensive. This means being able to pivot, generate power and score.”
Ms. Nunno suggested CIOs do three things:
Pivot to an offensive leadership position – decide the ideal terms of engagement in working with the rest of the business; decide the ideal preconditions for colleagues to access IT resources; then collaboratively negotiate final terms as partners and agree upon a final set of working principles.
Strengthen the offensive team – create fusion teams of both IT and functional experts that can grow the business and defend it at the same time.
Score points with board communications – drive traditional and digital discussions through the lens of revenue, cost and risk.
Technology has created a new type of customer demand or “turn” – the Everything Customer. Gartner defines the Everything Customer as a customer that wants conflicting things at the same time, often driven by pervasive technology. For example, customers want all the necessary features in a mobile application, but they also want it to be effortless.
However, using technology to meet customer demands has, sometimes, left customers feeling disconnected, creating a gap between technology and people. To bridge that gap, the winning CIO commits to designing experiences that create value from the intersection of customers and technology, ensuring the Everything Customer is engaged continuously.
“To do that, organizations need a technology platform that will bring these well-designed experiences to life. Gartner calls this the multi-experience platform,” said Don Scheibenreif, distinguished research vice president at Gartner. “Using building blocks from the digital business platform, the multi-experience platform delivers consistent experiences across multimodal touchpoints. Your phone, internet, clothes, watch, virtual assistant, and refrigerator will all be able to interact with you, the Everything Customer anytime, anywhere.”
“Winning in the turns takes more than just making more technology available to customers. Customer TechQuilibrium is achieved when we gain the most value from every moment when people and technology intersect,” said Scheibenreif.
The digital society is the sum of all interactions between people, organizations and things, and society is digitalizing quickly. Best practices and old rules don’t work anymore. New practices and new rules are needed, including how to manage the abundance of data and intelligence that AI and the Internet of Things (IoT) have provided. Finding the data is not a challenge anymore. The “turn” is how the data is used.
“Three things are needed to balance value and responsible use of data – solid information governance, providing real value based on data so that people can see how sharing data can benefit them, and providing more transparency and control to gain trust,” said Mbula Schoen, senior principal research analyst at Gartner. “Organizations can also implement a societal value proposition which focuses on building a business out of improving our digital society.”
Seventy percent of stakeholders expect companies to take a public position on social issues relevant to their business. Organizations should consider building a societal value proposition. It is not about donating or volunteering for a good cause. It is about building a business out of improving the digital society.
“The digital society is the ultimate opportunity to win in the turns. CIOs and IT executives should focus on shifting security and risk management to protect their businesses and society. They should design personalized customer experiences and solid information governance to be a trustworthy custodian of data and find a social topic relevant to their industry and build a societal value proposition,” said Ms. Schoen.