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New leadership and organizational requirements in a customer-centric world: Part 5

May 11, 2017
Part 5 of a 5-part series on the changing C-level foundation in manufacturing

Despite pressure to adopt disruptive technology at the speed of change, manufacturers should pause, evaluate, and modernize their organizational structure to ensure alignment with customer needs.

  1. New leadership requirements
  2. Enter the chief customer experience officer
  3. Rocket ship to Planet Customer, a whole new world
  4. The two faces of the CIO: Dr. Functional and Mr. Strategic
  5. How CIOs can secure their place at the table

Defining the strategic role of the CIO

Any discussion on the changing role of the CIO inevitably seems to come to the magnitude of digital disruption and the overwhelming amount of sensor-generated data, data and more data. Who could possibly understand and manage it all? The role brings responsibility for hardware, software, and security, not to mention the imaginative vision required.

The authority over data is a critical consideration in the role of the CIO, one that often brings debate. Today, data is considered one of the organization’s most valued assets, representing historical trends, customer insight, and potential revenue opportunities. It is logical, therefore, that whoever controls the data controls a great deal of authority and power in an organization. In traditional business hierarchies, the CIO essentially held the keys. This is evolving. With the expanded importance of data in modern business, new titles, like chief data officer and chief digital officer (CDO), are emerging.

The article “CIOs must become hybrid IT and digital leaders to avoid becoming unfashionable” explains the role confusion that can arise when companies add a CDO. In the article, Ian Cohen, a former CIO and now digital advisor at the Leading Edge Forum, says, “The urge to ‘go digital’ amid this identity crisis has caused a problem when it comes to hiring decisions, as businesses don’t know what they actually require. Some organizations are running around hiring a CDO without even knowing what digital means to them. Frankly, if an organization has a CIO and is now looking to add a CDO, they didn’t have the right CIO to begin with.”

What should CIOs do to retain or expand their role?
While some high-pressure stress can come with a key strategy-setting position, CIOs who welcome this type of role or want to expand their core of influence can take some precautions to ensure their skills remain relevant to new demands.

“At present, experienced CIOs do not generally have a digital and data mindset, which is a problem for companies looking to transition to a digital operating model. Companies looking for significant change are generally looking outside for a CIO/CDO hybrid, but in reality few of these individuals exist,” says Simon Gratton, former CDO at Zurich Insurance and Deloitte in Computer Weekly.

Tech leaders seeking opportunities in this new context need to increase their digital and data thinking to be successful, but this varies, according to Gratton. He says that in small and medium-sized companies a single individual can handle the task, while larger businesses require a “golden triangle” between CIO, CDO and chief operating officer.

Gratton adds that recruitment of manufacturing leaders in the future, whether a CIO or CDO, will be more about mindset and less about skillset. If corporate cultures and operating models can focus on the customer, rather than internal squabbles about budget, power, and data ownership, success will be more likely.

5 steps for the CIO to take

The CEO and other C-officers are looking for advice from experts who understand the overall company vision, market—and the disruptive technologies sweeping manufacturing. The CIO can fill that role by demonstrating a broad knowledge base of IT, and digital topics, plus an understanding of the customer and potential gains from deploying a customer-centric model. This needs to be practical as well as visionary, and more than just talk. Here are five ways CIOs can earn their place at the strategy table.

  1. Show your innovative side and ability to think big
    IT is no longer about managing an ERP solution and financial database. It has become much bigger, something that can be difficult to explain using the old school terms. Not only does the CIO need to remain current on quickly evolving terminology, the CIO must also must also make sure the extended IT team and corporate leadership understands the evolving jargon, too. Only with a shared vocabulary and understanding can meaningful dialogue take place. As you share your grasp of complex technology, be sure to convey that you can look beyond the ordinary and beyond tomorrow. Think big. Be bold.
  2. Demonstrate expertise in digital strategies, IoT, and data science
    There is no one technology that will be the magic answer for the future of manufacturing. Make sure you have a wide knowledge of digital technologies as well as Internet of things (IoT) and data science. 3D printing, virtual reality, machine learning, and robotics are other hot topics. Keep in mind you don’t need to be the expert on each, but demonstrate that you know those experts, can enlist their support, and understand the issues enough to engage in thoughtful conversation with consultants and advisors. Knowing the right people—and the right questions to ask—can be extremely valuable.
  3. Lead, delegate, and inspire
    No one can do it all. The successful CIO tends to be a leader, able to inspire and delegate. For some CIOs, letting go of legacy systems can be difficult. Delegating tasks, like monitoring security, to outside sources, can be very difficult. But, a balancing act of turning to outside sources and new tools tends to be the tactics high-achieving CIOs adopt.
  4. Reveal depth of product and customer knowledge
    The existing CIO, often someone who has worked up through the ranks, often will have many advantages over outside candidates who may be considered for CDO positions. The CIO tends to know the product lines, the customer expectations, and the company's historical journey. That background is important when building an organization closely aligned with the customer.
  5. Understand the language of the CFO
    Speak fluently about return on investment, cash flow, and tactics such as subscription models, to alleviate stresses on capital funds. The CIO should be able to translate the value of customer-centric manufacturing in dollars from repeat sales. Instead of discussing the time savings of having the warehouse team maintain their own “virtual warehouse” for customers, the CIO can turn the features into dollar savings and expected boosts to sales.

Wrapping up the series
In this 5-part series, we looked at the complex challenges of changing the C-level foundation in manufacturing, the role of the chief customer experience officer, chief data officer, and how CIOs are adapting. Disruptive technologies will play a role in shaping the future job descriptions of IT professionals, from the C-level to shop floor users. Change is fast and dramatic. Understanding today’s landscape is just the beginning. The IT team, now more than ever, must be continuing learners, absorbing new releases with a hungry desire to stay on top of the progress and embrace the new manufacturing. Mindset is critical. Willingness to evolve is essential. Then, the ability to imagine innovative possibilities is the next key element. When you can do that, the rest is easy.
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