Earlier this year my colleague Susan Hall published a great interview with Krishnan Chatterjee, chief marketing officer for offshore IT and software development company HCL, in which Chatterjee discussed "the reincarnate CIO," the technology leader comfortable with driving business growth. The three defining qualities of these leaders, Chatterjee told Susan, are:
... a strong understanding of the currency of business and the end customer, ... the ability to leverage IT for business costs as opposed to treating it from an IT cost perspective, and ... the ability to harness new technologies to create competitive advantage for the business.
This marks a distinct shift from the internal focus common among CIOs in the 1990s, when the primary responsibility was implementing ERP systems and other back-office technologies. A tough economy has created new imperatives for IT, said Chatterjee:
... There is enormous pressure today to look at some form of rejiggering or reinventing their business model, so a lot of businesses are turning to IT, saying, "Look, you have to produce some kind of innovation with which we can reach new customers to trigger faster growth."
Chatterjee described an HCL client, a retailer of home furnishings, that is deploying an iPad application for in-home sales. Sales personnel can visit customers, pull up their inventory via the iPad app, take a photo of a room and show customers how different furnishings would look placed in different positions in the room. Said Chatterjee:
By using mobility and working on the user experience, IT has created a new sales channel that is the most profitable channel these guys have ever found. That kind of stuff, to me, would be absolutely business-leading. And it's not something I would expect the business to come up with, because it already has its retail outlet and other channels, maybe through architects and interior designers or whatever, that they've been working with for umpteen years. But with a new channel, IT comes roaring in with a disruption to the business model.
Similarly, a recent InformationWeek piece relates the experience of Vail Resorts CIO Robert Urwiler, who worked closely with his company's CEO on brainstorming ideas for a Web and smartphone application called EpicMix that lets resort guests see how many vertical feet they ski in a day, share details of slope time with friends on Facebook and disclose their location in real time on the mountain, among other things.
The article notes CIOs will probably make some mistakes as they explore new and relatively unknown technologies like mobile applications. But, author Chris Murphy writes, echoing Chatterjee, "CIOs and their IT teams have a chance to make a huge and lasting impact on how their companies do business." The article quotes Urwiler:
We really do have to change our position from thinking of ourselves being pure internal service providers and order takers to people who are on the outside looking in like a customer and asking, "What would you want?"
I wrote about the need for CIOs to focus more on external customers back in June, citing a Diamond Management & Technology Consultants survey that found three-quarters of business leaders and CIOs said the CIO's primary innovation role was improving IT processes or internal business processes rather than improving customer service, reaching new customers or creating new products/services. Given the rapidly changing nature of business, CIOs need to turn these opinions around.
When Chatterjee spoke to Susan, he told her CIOs are reacting to new market imperatives in two ways. He said:
... Some of our customers are converting all of this into massive opportunity and some, I think, are really struggling.