Analyst Michael Krigsman: CIOs Are Facing ‘Existential Issue’
CIOs must think of themselves as business leaders first if they’re toremain relevant in the modern enterprise.
“I personally think that relevance is the most important topic for CIOs today, and you gain relevance by being a business leader, by understanding the business that you’re in,” said longtime industry analyst Michael Krigsman.
Krigsman is also host of CxOTalk, for which he has interviewed more than 600 business leaders from major brands about such topics as digital transformation, artificial intelligence, data science, and evolving business models.
With all that insight, Krigsman was a natural to turn to about the expanded role CIOs now play in their organizations. Among the biggies he detailed: enabling customer experience, leading the AI charge, and becoming a “respected voice” about innovation.
What is the role of the CIO and IT in managing the customer journey?
There is a distinction between the traditional infrastructure-focused CIO and what we might call the transformational or customer-focused CIO. Historically, the CIO was responsible for infrastructure and systems, and therefore you had IT metrics like system uptime, latency, responsiveness to trouble tickets, and things like that. Essentially, IT operations.
However, today there is an existential issue for CIOs, which is maintaining relevance to the business. For a CIO to remain relevant, operational excellence is essential, but it is not sufficient because a modern CIO must be first and foremost a businessperson. She must be closely tied to the business, to the underlying business objectives and goals and strategies. She must be connected to other business leaders, she must understand what the company does, and she must understand what the customers of the company expect. It’s a different focus than the historical role of the traditional CIO.
What trends are forcing CX to the top of the IT agenda?
Customer experience tends to be a marketing term, but if we take that concept and broaden it slightly, we can talk about the customer perspective and being customer-centric.
Customer experience is a crucial part of that, but digital transformation is about customer focus. It means realigning the business model based on what is essential to the customer. The CIO has to fall in line with that or else lose relevance over time. And the worst thing that can happen to a CIO today is that he or she is relegated to infrastructure, to what we call feeds and speeds.
In what areas specifically would you say IT can make the biggest impact from this customer-centric, business-transformation standpoint?
The best thing IT can do is work with business leaders and be an innovation partner. The CIO needs to be the person who can say, “OK, so, you’re trying to achieve this particular goal with a customer.”
So, for example, marketing is going to have a variety of different marketing tools. In the past, it was really IT’s responsibility to help find the right tools. Today folks working in the lines of business and in corporate functions understand technology in a way that they didn’t before, which has an impact on IT.
So the CIO can help select those tools and definitely must be involved with integrating those tools into other parts of the IT infrastructure. Security is another crucial piece of this, and also the management of data is another crucial part.
The CIO can provide advice to business folks to help them select, acquire, and integrate the best tools available.
OK, so they are enabling customer experience.
Enabling is an excellent term for this. First is understanding how technology can support the business objectives. If a marketing person is trying to get campaigns out more rapidly, for example, technology is involved, and you have to find that technology.
Second is the implementation of that technology, ensuring that it’s secure and integrated with other corporate data and systems. And then third, there is the maintenance of that system over time.
What about artificial intelligence? What impact has the proliferation of AI had on the role of IT?
We’re very high on the hype curve right now for AI. Most companies are going to be using AI in the service of some business process. That means efficiency or innovation, making a business process more efficient—faster or cheaper than before—and making possible things that couldn’t be done before, which is innovation. That’s the ultimate promise of AI.
For example, earlier this year MIT announced that some of their researchers are using AI techniques to discover molecules that will create better antibiotics to treat antibiotic-resistant bacteria and diseases. That’s an example of using AI for meaningful innovation.
From an IT standpoint, the CIO must understand how to select, acquire, and test AI or AI-backed tools. What kinds of proofs of concepts make sense? What’s the most strategic approach to using AI to move beyond efficiency into innovation? It’s easier to think about improving a process to become more efficient. It’s much harder to think, “How can this change our business?”
The CIO needs to keep his or her ear to the ground about what kinds of technologies are coming up that can support business strategy and goals. But there’s another important piece to this: The CIO should have a respected voice when it comes to innovation beyond efficiency. Improving efficiency, reducing costs, things like that are table stakes. But the real value of innovation happens when we use technology to change our business model, to improve processes and products, to do things that we couldn’t do before.
For the CIO to gain the confidence of senior management requires developing a high level of trust and credibility. I used the term “relevance” earlier. Part of the reason that the CIO needs to focus on having this strategic viewpoint is to develop that credibility. When the CIO sees technologies that can make a strategic difference or an innovation difference like AI, and they bring those ideas to the management team, the management team will listen.
Research shows that CIOs often lead their companies’ digital transformations. Why do many organizations think IT is best-positioned to lead these efforts?
There are two reasons. First, technology is foundational to these changes. Earlier, you used the term “enabling.” Well, technology is the big enabler for transformation. Obviously, the CIO is positioned better than anyone else to be centrally involved with technology as an enabler of transformation.
Second, the CIO is in a unique position because the CIO sees across the entire organization. For example, marketing sees the world through a marketing lens. The CFO sees the world through a finance lens. But the CIO is the only person who has responsibility going across every single function in the company. That breadth is a double-edged sword because the CIO is exposed across the company and is very visible. And with great opportunity comes great responsibility.
That visibility is one reason why the CIO job is under so much pressure. If the CIO is not focused on the business and overly focused on infrastructure, then the CIO will fail. CIO success happens when the CIO understands the business and is part of the business.
This is not theoretical. It is real. This is what’s happening. … Know your business operations and understand your customers—those are the keys to relevance for CIOs today.