How is the CIO role changing?

In today’s world, many CEOs forget they the must be CEOs (Chief Enabling Officers!) and act like CEOs (Chief Execution Officers!).  But that is not part of our topic now. We will save it for a rainy day.

We also see two important developments happening in the realm of CIO:

1. Technology and business boundaries are getting blurred. Either of them cannot be stand alone!
2. Business strategy is not decided independent of technology rather the latter is a critical component in formulating a plan.

In other words, the era of business-led / technology-enabled CIOs has ended; a new one technology-led / business enabled has begun!

What kind of battle is waged by the CIO? A three-pronged battle:

1. Drive / Enable business strategy harnessing the power of technology in a secure way
2. Battle with monolithic systems of records and data and inflexible, technical-debt ridden architecture
3. Maximize value

Where does that leave the CIO? Here is how I see the role changing:

There will be a huge metamorphosis of the role possibly eliminating a dedicated CIO. Parts of the role may manifest in other areas. For example, the resources (including technology, required infrastructure, cloud, network, end user computing, devices) might be controlled by the COO. The enabling aspects of this would be owned by the line function leaders who are responsible to customers or business stakeholders.

The first view point is that the CIO role would disappear. Whilst this may take a while, things will become difficult for the CIO in the coming few years. Certain steep changes will be the order of the day.

#1. CIOs who are experts in technology – legacy or digital can expect to be pigeon-holed. Those who use to to bamboozle the rest of the organization with fancy architecture and buzz words will recede into the background. They need to invest in soft skills. They need to seamlessly align with the organization business strategy and business line function. Every project that originates from the CIO office will be relentlessly subject to CBA (Cost Benefit Analysis). Can the CIO stand up and articulate what, when and how he plans to stay relevant and important to business? Even this won’t do; they should be skilled at spotting new business opportunities and be able to influence their ideas. They have to become more human and partner with others in order to maximize their value to business. This partnership can be internal or external. Nurturing and harnessing a good eco-system will help.

#2. Continuous realignment of the organization, teams, skills and outlook will be required even to stay afloat. What do I mean by this? IT world is ransacked by new trends and terms like agile, DevOps, DevSecOps, Continuous integration/deployment. More trends and methodologies will start coming in. We are already talking about a low or no code IT that can be bought, scaled up or down and customized / enriched. The CIOs should reflect on how and what this means for the team? We used to have specialists in IT like SQLServer expert, Oracle DBAs and Network engineers. Whilst some roles will continue, they need recalibration as the IT world changes. Does it pay for a separate testing category to be developed? Perhaps an automation tester is required. A developer should also be a capable tester. To what extent soft skills and business skills are to be embedded within IT? 

A recalibration of the IT team that is not compartmentalized but can be assembled to deliver digital transformation of the business is the need of the hour. And the IT team members should be prepared to don different roles in different teams! Towards this, the CIOs should be prepared to and implement redefinition and rebaselining of skills, recalibration, training and enablement etc. And the team identification, deployment and delivery should, subsequently, follow these new ways.

#3. A CIO should transform into being a change agent of the organization. They will have to become value creators and for that they should transform into change instigators. Status quo is no longer an option. Even if a CIO continuously maintains the estate well and runs a tight-knit disciplined shop, that won’t be enough. Most of the normal health parameters have been pushed into the very bottom so much so that they don’t require special oversight nor reporting. Today’s tools / products come with self-healing and self-reporting properties. In order to transform a business operations and drive value, they have to remain restless (in a positive way!). I would go to the extent of saying a controlled panic will do a world of good now and then!

To conclude:

• Tomorrow's CIOs will have to drive, innovate and execute with the first two as the dominating functions

• They need to enable a high-performing environment, business-oriented and flexible teams with multiple skills.

• The operational responsibilities will not go away but take up less and less time allowing them to act more as leaders, communicators and innovators.

• Quite a few organizations are taken aback by the lack of clear definition of “Digital.” A few CIOs and their direct reports, I met, are constantly worried by the lack of uniform definition of "Digital." Why worry? Instead, the CIO (whether it is a digitally-born or digitally-aspiring organization) can take this to his/her advantage. This is because any digital transformation is less about a digital technology or strategy but more about a successful business in the digital world.

Do you have a copy of your CHRO’s KPIs?

If you look at the balance sheets of top 1000 companies worldwide, the tangible assets have dropped in S&P market value from 68% in 1985 to an average of 13% today. What does this tell us? The tangible assets no longer represent the thing to focus and do not necessarily translate to competitive advantage.

HR started evolving from a time sheet and salary disbursement activity to a move evolved comprehensive learning based function. Like any other function, HR too has transformed to applying analytics. In the process, most of the traditional areas have either gone to the fringe of the HR circle or moved away to other parts of the organizations. Here is a quick summary of all those, considered once the core of HR, being moved out:

• Recruitment, especially the fresher / campus hiring
• Induction of employees
• Training, Learning and Development
• Regular hygiene activities – Time sheet, salary, leave etc.
• Benefits management

Does it make you wonder what the HR function is responsible for? Try speaking to any senior HR person and ask them about it. If they start to unleash a large mouthful with long-winded sentences, read on:

A very fascinating finding of Gallup’s research on the employee experience reveals that organizations rarely meet people's basic needs at any stage of the employee life cycle. < 15% of the employees feel fully engaged with the organization! This may appear counter-intuitive with the high number of HR executives and CHRO walking around, holding various meetings, birthday parties, festivals and town halls. In fact, this clearly demonstrates the quantum of people in HR function may not translate to looking after the “competitive advantage” of the enterprises!

The converse could also be true. It is possible that the CEO or other functional leaders remember HR when people are not productive or the attrition % has shot up or an important person quits. A pity indeed! Instead of holding HR accountable for attrition, try doing the reverse. Ask HR to analyse why people stay in the organization for whatever duration they stay! If you have a few minutes, try reading Sandy Gordon - an eminent sports psychologist who transformed many sporting units, especially Australian cricket, into a fighting machine. He advocates replication of those factors or winning conditions that are essential for victory. Instead of whipping up the people for losses by doing endless root cause analyses, find out under what conditions people have flourished and tranformed their capabilities into a competitive advantage! In short, analyse the wins and the success factor more than the failures!

As leaders, what need to change?

Start with the belief that HR has the same set of metrics as the overall organization whether it is profit or growth or a combination of them. Shed the mentality of HR that it is possible for HR to succeed when the rest of the organization bleeds. It is true that there are unique metrics / KPIs that describe the outcome of HR. But they are eventually linked to the organization’s goal.

Like other ingredients that go into delivering the final product or service, treat HR as another important one. The “HR” cannot be applied on top of other functions or can be called last minute to do some cosmetic arrangement. That’s a sure-fire way to fail fast! HR is as integral as marketing or production.

The one thing that matters is the employee engagement / experience. All other metrics that tom-tom the success of HR are mostly irrelevant from a medium to long term perspective. Consider this. In a given month, ramping up 500 people with specific skill sets could be a KPI. Meeting this number is a must so long as this is in line with part of the annual plan. But meeting this is only a part of the HR journey. For example, if the employees are not engaged that manifest in multiple ways, HR should be worried! If, out of the 500 who joined the organization, only 40% are engaged and productive, HR must stand shoulder-to-shoulder with business to ask WHY. HR should be enabled to invest in suitable data collection mechanisms across the organization / industry and arrive at meaningful insights for employee engagement and experience. Sometimes, HR has more data than what is required or unable to make use of it.

In today’s world, HR is not confined to one person or a group of persons sitting in a particular corner. To the employee, his or her touchpoint with the manager acts as the HR interface. The employee sees the reporting manager as part of company’s HR. To that extent, these people can be the best friends of HR. If an employee is happy or otherwise, it is most likely that the managers would be the ones to notice it first. Make the HR accountable for employee experience not for setting up a medical facility within the premises.  Congratulate HR if year after year your employees keep adding more and more value to your customers and thereby to your shareholders. Reward HR if your employees regularly update skills, learn proactively and contribute more deeply to customers making their tenure an enriched one. 

Maslow's pyramid has to be redrawn now!

References:

https://www.gallup.com/workplace/259520/needs-succeed-don-yet.aspx?utm_source=workplace-newsletter&utm_medium=email&utm_campaign=WorkplaceNewsletter_October_100819&utm_content=findoutwhathrneeds-CTA-1&elqTrackId=2e2cfb7cb15a4130b9bee7275ff8b865&elq=b7a9ddae639e43d9b933f7b6de8fdec6&elqaid=2428&elqat=1&elqCampaignId=552

https://research-repository.uwa.edu.au/en/persons/sandy-gordon