SBA

The Year Ahead

In my role as leader of ELITE I was recently invited to represent the UK at the annual two-day conference of the European CIO Association, EuroCIO, which was held in Berlin earlier in December. 

We all know what these associations and conferences can be like, they generally fall into two categories - those attended by a lot of bit-players, or the real deal. Having watched presentations by the CIO’s of Allianz, Thyssen Krupps, Belgian National Lottery and Solvay, and had discussions with the CIOs of The Dutch Post Office, Total, Agfa Gevaert and Lagardere amongst others, I think one has to conclude that this was the real deal. Well over a hundred top CIOs from across Europe attended what was a very serious conference with real horsepower. There are 10 National CIO bodies affiliated to EuroCIO and a number of very large corporate members; between them they represent over 900 major corporates, 600,000 IT employees, and a consolidated IT budget of c. €150 Billion - this was a conference for the big hitters. That’s all without a contribution from the UK - my invitation was to discuss the possibility of the UK’s national group for IT leaders joining EuroCIO.

Interleaved with the CIO presentations we had a set of six workshops running in parallel, each collecting the wisdom and experience of the attending CIOs on a specific topic, and it’s these topics which point the way to the primary concerns of corporate IT leaders for 2016.

Trust & Security

Right up there at the top of the CIO’s agenda is trust / security. Recent major hacks and data leaks have brought Cyber Security up to the top of the agenda not only for IT leaders but also for company boards. There probably isn’t a single major IT leader worldwide who doesn’t have security as a top item on the agenda, so 2016 is looking like boom time for cyber security vendors and experts. If IT can’t deliver security and stem the recent rash of data breaches then people will lose trust in e-Business and digital channels with major consequences for first world economies that are increasingly dependent on digital to deliver more growth at lower cost.

Digital Transformation

Coming up close behind security is the digital transformation of organisations as we move towards a society where interacting with customers online in their own time is an economic necessity. Digital has become the new face of business, but it brings with it a host of problems for IT leaders. New IT is needed to deliver the online experience that consumers and citizens are increasingly expecting, with companies like Amazon setting the global benchmark. Amazon has been online for 20 years, was designed as a digital business from the outset, and has a huge head start over the majority of established organisations which, frankly, have been slow to adapt to the new world order. Digital means new operating models, new business models, and massive change to established corporate structures, all of which has to be enabled through new IT.

Architecture for Innovation

Most corporate IT departments are conservative, slow moving beasts for reasons I’ve explained in earlier articles. The need to move quickly in response to Digital has come to a rude shock to many, and as they try to accelerate their change and development cycles many IT departments are cracking up. New methods and techniques such as Agile Development and DevOps require entirely new and revolutionary ways of working within IT, and as with most other aspects of business change is hard. IT leaders across the world are struggling to find ways for their IT teams to deliver the change and new systems needed by the business whilst maintaining their core legacy systems which support the old business model and all the logic needed for the enterprise to do what it does. IT leaders across the world are currently either trying to convert IT departments which were built for business marathons into sprinters, or implementing what I have previously called Two-Speed IT and which now goes under the more fashionable moniker of “Bi-modal IT” - i.e. they’re trying to do the slow stuff and the fast stuff at the same time. The architecture of the corporate IT function is under scrutiny like never before as leaders seek ways to innovate before their companies get left behind by the stampede of new businesses which have started from scratch in the digital era.

Internet of Things

As if Digital wasn’t bad enough for the IT leader, the Internet of Things (IoT) has also been rapidly gaining momentum, and is fundamentally changing business models. Whilst Digital is largely about doing the same old transactions differently, and at the beck and call of the consumer, the Internet of Things provides the ability for intelligent businesses to turn transactions into relationships. We no longer just sell something to a consumer, the IoT means that we can maintain a continuous relationship with whatever we sell, and through that a continuous relationship with the consumer. From televisions to insurance policies the Internet of Things is enabling a fundamental change in business model which enables the savvy supplier to sell, sell, and sell again - a combination of interlocking products and services which bring a whole new dimension to the tired cliche of “a customer for life”. As with Digital, the IoT means the IT leader has to find new technologies, new skills, and new ways of working in order to keep the business at the forefront in the digital age.

Skills Development & Frameworks

The demand for new skills in the IT department, to enable Cyber Security, Digital and the Internet of Things, is placing huge stresses on IT and HR departments. Giving the IT function a whole new operating system was never going to be easy, and large corporates are increasingly focusing on the development of new skills development and career progression frameworks to bring structure to the chaos of so many conflicting needs. In the UK the Skills Framework for the Information Age (SFIA) is well established and has just been updated to version 6, within mainland Europe the European e-Competence Framework is now on version 3 and European CIOs are considering what is needed next in its evolution. For larger companies with hundreds or thousands of IT staff the need for structured frameworks has never been more pressing in order to manage IT skills development through the current period of extreme change.

And lastly, Cloud Benchmarking

Cloud, one of the most fashionable IT buzzwords of recent years, is going big. The Digital revolution means that companies must move their IT out of corporate data centres and closer to their customers. They must achieve massive scalability to meet the demands of millions of online users instead of merely serving the direct IT needs of employees. The Internet of Things brings similar pressures with the prospect of hundreds of millions of IoT-connected devices also wanting to talk to the corporate systems. With the need to go big in Cloud IT leaders need new methods to evaluate Cloud providers and their systems, to compare offerings and costs and make the best choices for their companies. The ability to deliver good cloud-based services will be as important for the IT leader of tomorrow as the need to deliver good internal networks and systems for the company’s employees is today.

So that’s it, these are the big issues on the minds of leading corporate CIOs. They point the way to a major focus for corporate strategy over the next few years. Obviously the leaders in European business are addressing these topics now and 2016 will see these as the major themes for corporate IT, but the long tail effect means that they will be current for at least the next five years as the slower adopters catch on. If you want your company to remain in the vanguard of your industry the chances are that you need to have these topics on the board agenda, and focus your IT leadership on pursuing them - none of them are easy to get to grips with.

A final note for the Isle of Man, one of the presentations on Digital Engagement was by the CIO of the Belgian national lottery, who talked about the massive growth Loterie Nationale has achieved through digital channels over the past few years, and in particular the lottery’s move into sports betting. For me at least it was a revelation that state-sponsored lotteries are moving into sports betting, and also looking seriously at the possibilities of e-Sports - they may be bit players at the moment but the prospect of competing with the massive resources of state-owned operators should send a little shiver up the spines of our sports betting company CEOs.