Before the advent of the Industrial revolution, civilization was at the mercy of hand tools and simple machines. The first and second industrial revolutions brought mechanization into the picture. The Third industrial revolution gave it a digital push and the world started moving from analog to digital. The Industrial revolution brought computers to everyone’s desk, it focused on data that ultimately led to process reengineering, automation etc. As all these evolved in the corporate scenario, so did the role of CIOs. The Third industrial revolution was the era when the term CIO first came into existence. As the industry moved ahead and embraced the next industrial revolution, so the role of the CIO got broader and wider.
Evolution of CIO role –
Like the industrial revolution, the CIO’s role transformation can be divided into different phases.
IT Head 1.0 – CDO (Chief Data officer) or CDCO (Chief Data Center Officer)
Prior to this era, IT was primarily focused on small scale support projects, a strategic touch to the IT function was missing. The CIO role was created to fill that void. However, during the initial phase of technology, the CIO’s role was merely titular with the CIOs performing the role of an MIS manager or EDP manager. Their responsibility was limited largely to maintaining computers – hardware, software, network etc.
IT Head 2.0 – CTM (Chief Technology Manager)
Soon, businesses started realizing the significance of technology and started using it as a competitive asset. CIOs took a predominant role in harnessing the power of automation for organizational benefit. From managing hardware and software, they gradually moved to managing processes. However, the role was limited to primarily automating backroom processes.
IT Head 3.0 – CBDO (Chief Business Driver Officer)
This phase marked the shift of the CIO role towards a strategic direction when the businesses started treating technology as a strategic asset. CIOs got woven into the fabric of corporate strategy planning and decision making. They were no more the mere executers of the strategy made by others, but started taking a more proactive stance and created an IT strategy in line with the business strategy.
IT Head 4.0 – CDIO (Chief Digital Innovation Officer) or Digital Innovator
Progressively, IT has transformed from dump terminals to smart machines, technology has shifted from mainframe to machine learning. In the disruptive world, customer needs are fluctuating, processes are becoming complex, and the business environment is changing. Going digital is no longer a matter of choice as the world is shifting “from Being Digital to Born Digital.” Consequently, the CIOs’ role continued to evolve in parallel with the evolution of digital technology. It is no longer limited to IT strategy creation but to create digitally enabled organizations. They are working with business leaders creating new business moments, and transforming business models by harnessing technologies like blockchain, artificial intelligence, analytics and creating products and solutions which are not only for today but serve future needs.
The journey of the CIO in Mahindra & Mahindra –
IT in Mahindra and Mahindra (M&M) has a journey similar to this. Our first encounter with the digital world come with the introduction of an ERP system; over the years the role of technology and thereby the role of the IT team has transformed from being a supporter for business to a value creator. For me it is a journey of 3Es – Enable, Enhance and Engender. CIOs, initially, played the role of an enabler of business, gradually they transitioned towards the Enhancer role and gave us some big bang initiatives such as Project Harmony (50 Mahindra companies went live on a single cohesive global instance of SAP in a short span of 8 months – a world record not surpassed till date), the MeConnect app (a first of its kind, and a bouquet of 60+ apps wrapped with a unique UI that integrates data from the Internet, the Intranet and the employee portal).
Today we have SAP HANA to suit the needs of high speed computing and O365 to make the best use of unlimited scalability and most of the cloud. Now the CIOs are playing the Engender role where they are co-creating new business models. In M&M, we have businesses like M2ALL, Smart Shift and Trringo whose business model is completely based on a digital platform. All these businesses, and sites like With You Hamesha, SYouV, Tractor Mitra and others, mark our transition from being a traditional manufacturing company to a digitally enabled automotive player.
On the strategic front, we have created a three-tier structure for the IT team. At the top, the Strategic Leadership Council (SLC) approves IT strategy, drives business to adopt technologies and provides strategic direction on major IT initiatives. The second tier is called the Technology Leadership Council (TLC), comprised of CIOs that formulate IT strategy and ensure synergy among Mahindra Group companies. The Third level is the cross-functional teams (CFT) that execute these strategies at various group companies.
The Mahindra Group believes in 3 precepts – “Simplicity, Synergy and Digitization”. Our IT team is working closely with businesses to achieve this mantra. In accordance we have created a call to action for our IT community – “One Vision, One team, Digital First, One team.”
What the future holds for the CIO role?
The question that comes to our mind is – what is next for CIOs? Is the CIO role at the last phase of its evolution? The simple answer is: this evolution is not fully complete as they have a long way to go before attaining full maturity. However, as no one can confidently answer when the next industrial revolution will happen, similarly no one can possibly predict what shape the future CIO role will take. While some says, CIOs will become CEOs (Chief Enabling Officer) and drive innovation into business, others predict the role itself will cease to exist and alternate profiles like Chief Digital Officer, Chief Technology Officer and others will be on the rise. No matter which way the CIO role evolves, the consensus is that the role is changing in the direction of technology driven business innovation.
Challenges for CIOs and their Play-to-Win strategy
The CIO’s job is never a smooth ride, it is like driving on a bumpy mountain road where you don’t know what is lying ahead of the curve. At present, the major challenge that an IT team faces is lack of acceptance and confidence. Too often, IT is viewed by the business as an expensive internal function or an obstacle to progress due to the security concerns that all the digital technologies bring into the picture. Also, most of our effort (nearly 70%) goes into the ‘Enable’ activity, whereas ideally the case should be reversed. This situation may become grave in the future unless CIOs gear up to change the way they function today.
In order to turn the table, the CIOs need to focus on a few paramount functions.
- Enable activity:
- Run IT like a business – In future IT has to run like a business with its own metrics and success criteria. The CIOs need to target operational excellence (in terms of IT cost), set up performance metrics, create a best-in-class digital workplace, and maintain the cost-profit balance.
- Enhance Activity:
- Enhance operational efficiency and productivity – Learn and challenge current business processes and offer digital solutions not only to improve existing processes but to create new ones. Use technologies like automation, 3D printing, and predictive analytics to achieve the margin of safety target, reduce overall cost and thereby enhance efficiency.
- Work on strategic alliances – More often an ecosystem works better than an individual institution. Blockchain experimentation and implementation is just one example of this. A CIO can plan to create 360 degree collaborations with other players in the industry to bring good practices and lessons learnt from failure to their organization.
- Engender Activity:
- Inculcate a digital culture within the organization– Educate business and employees about the importance of technology and enlighten them about new advances on the digital front.
- Create new revenue streams for business – Now products are transforming into services, customers’ needs are changing rapidly. The CIO should ensure the business is agile and digitally enabled to create an immersive customer experience to suit the need of the hour. Also, by utilizing the power of digital, CIOs will help create new digital business models.
- Create a circle of excellence – At present, most of the technology implementation happens in silos. A forward-looking CIO will establish a ‘digital circle of excellence,’ spanning the whole digital strategy, including social, apps, websites, devices, sensors, and data analytics — and enlisting a leader who has both a customer perspective, and some experience with systems implementation.
I want CIOs to feel that they understand the digital world and processes like no one else in their organization does. It will be a pity if in spite of having skills and knowledge, the CIOs cannot bring them to bear and play to win. Wishing the CIO community all the luck to become the nodal agency in their organizations.