The playing field of the CIO
by: Atos Consulting
Atos Consulting book examines dilemmas of the CIO (Chief Information Officer).
|Today’s CIO faces a huge number of dilemmas which must be addressed within different spheres of influence. These dilemmas relate to Demand Management, IT Compliancy, IT Shared Services Centres, application portfolio rationalisation and innovation. In the book ‘The playing field of the CIO’, Atos Consulting elaborates on these dilemmas and proposes practical solutions. It also includes supporting interviews with CIO’s and a number of business cases in the Netherlands.
Demand Management deals with setting up the demand function for IT in relation to the supply side of IT. At executive level, the CIO is the one officer who can bridge the gap between business and IT, and so plays a central role in this process. The increasing complexity of organisations, such as the complex control process and sometimes vague areas of responsibility, makes organising this no simple matter. In addition, there is a lack of knowledge of the increasingly complex IT sector, making it tougher for business and IT to work together. It’s the CIO’s job to ensure that the business gets what it wants without neglecting transparency, reducing complexity, standardisation and cost reduction. Atos Consulting has developed a model that incorporates conventional models (including IS-Lite, ASL and BiSL). Atos Consulting emphasises that organisations can exhibit different levels of maturity in different areas, and so in its growth model provides a blueprint for effective Demand Management.
Leverage for improvement
The CIO is responsible for making sure that IT meets compliancy legislation, such as Sarbanes-Oxley (in the US), the Tabaksblat Code (in the Netherlands) and other European legislation. However, legislation leaves room for interpretation, and the CIO must make choices between measures (costs) and effects (benefits). To make these choices, the CIO must simultaneously keep tabs on rapid developments in legislation on the one hand and the latest possibilities IT offers on the other. In this respect, being ‘au fait’ with the details is vital for knowing how to set up authorisations in relation to the limits of specific positions. Atos Consulting’s book treats IT compliancy as leverage for improvement of the IT operations. To do this, it outlines an approach that allows external requirements to be translated into internal control that covers all conventional requirements and avoids redundant work.
Research by Atos Consulting shows that the results of an IT Shared Services Centre (SSC) can turn out to be disappointing. And as responsible executive for providing IT, the CIO answers for the shortcomings. In practice, one factor is the increased distance between the SSC and the business. Centralisation reduces cost but does nothing for providing service to the business. The existing complexity is concentrated, but not alleviated. This means that it remains difficult to launch new products and tap into new markets. The CIO needs to ensure that the IT resources are transparent and flexible, so that the business can focus on sales and market share. In consideration of cultural aspects, the CIO needs to devote special attention when off-shoring. After setting up the SSC, IT needs to be standardised next, followed by the requisite sourcing to match the business goals, core competencies and desired flexibility.
Resolving IT complexity
CIOs are accountable for solving issues in IT complexity. Over the years, IT has developed into architectures consisting of many (sometimes hundreds) of applications operating on a variety of platforms and operating systems. In practice, it seems that the IT department is often there for its own sake, and loses sight of the organisation’s actual business need. In addition, the IT department must also stay on top of new requirements and developments, such as Service Oriented Architecture, Enterprise Service Bus and all manner of market-specific developments. This means that in the real world, a complex application portfolio becomes a major problem: making it harder to follow market developments, compliance with legislation is a never-ending struggle and the costs of IT go through the roof. Reduction of application complexity is then unavoidable; it is both an IT and a business issue. The book addresses in detail the seven steps for rationalising the application portfolio in order to enable performance improvement of up to 40%.
IT driving force for innovation
Historically, innovative organisations are shown to be twice as profitable as other organisations. Despite this, internally it is often a struggle to keep innovation on the management agenda. IT plays an increasingly important role in business operations, and it is the CIO’s responsibility to get the best possible return from IT. This often makes the potential of IT the driving force behind innovation. Along with a structural approach to innovation, the CIO must also ensure that the capabilities IT offers are being used optimally and that the results are guaranteed. Major innovations (such as the introduction of new sales channels) have to go through an entirely separate setup process at the organisational (including IT) level. After successful introduction, the sourcing has to be re-evaluated: sell, organise separately, or integrate. The CIO must ensure that IT keeps running without a hitch and that any required integration of front, mid and back office happens in a controlled way.
The book ‘The playing field of the CIO’ outlines how innovation can be approached in a structured way and the IT’s role at the various phases. It specifically addresses the strategic fit, the organisation of innovation and integration in the front, mid and back office.